National Healthcare Properties, Inc., a public non-listed real estate investment trust focused on outpatient medical facilities and senior housing operating properties, reported strong first quarter 2025 financial results, including a 483 percent increase in adjusted funds from operations, while continuing preparations for a potential public market debut. The company was formerly known as Healthcare Trust Inc. and externally managed by AR Global.
For the quarter ended March 31, the REIT posted funds from operations of $4.12 million, up from $0.91 million in the same quarter a year earlier, a 353 percent increase. AFFO surged to $8.79 million, compared with $1.51 million in Q1 2024. On a per-share basis, AFFO rose to $0.31 from $0.05, reflecting a 493 percent gain.
The increase in FFO and AFFO was driven by the elimination of related-party operating fees following the company’s internalization, lower interest expense, and a $25 million gain on asset sales.
Total same-store cash net operating income rose 3.9 percent year over year to $29.3 million. While SHOP segment NOI grew 18 percent, OMF NOI declined due to asset dispositions. Same-store occupancy in the SHOP portfolio improved 4.9 percent, with SHOP properties 78.8 percent leased overall.
National Healthcare Properties ended the quarter with a portfolio of 181 properties totaling 7.6 million rentable square feet and a gross asset value of approximately $2.3 billion. The portfolio included 136 OMFs across 27 states, with 90.5 percent leased, 91.6 percent same-store occupancy, and average annual base rent escalations of 2.3 percent. The weighted average lease term was 5.8 years.
During Q1, the company completed the sale of 12 assets for $168.4 million, contributing to year-to-date dispositions totaling $295.65 million as of May 8, 2025. The REIT cited a 6.8 percent cash cap rate and a 6.8-year WALT for the assets sold.
Net loss attributable to common stockholders narrowed to $5.02 million, down from $19.0 million in the prior-year period.
The company also reported a net leverage ratio of 9.7x, a 5 percent improvement from Q4 2024, and stated that 100 percent of its debt is fixed or hedged at an economic interest rate of 5.1 percent. Net debt to gross asset value decreased to 44.6 percent from 45.7 percent in the prior quarter.
Following the internalization of management completed in late 2024, the REIT estimates annualized cost savings exceeding $25 million. The internalization fee totaled $98.2 million and was fully paid in early 2025.
While two series of the REIT’s preferred stock remain publicly traded on Nasdaq (tickers: NHPAP, NHPBP), the company said it is actively preparing for a public listing of its common stock and has outlined plans for a corporate credit facility and future equity offerings.
As of Dec. 31, 2024, the REIT’s estimated net asset value per share was $32.15.
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