Financial Data and Key Metrics Changes - The normalized Funds From Operations (FFO) attributable to common shareholders was $0.02 per share, with adjusted EBITDA at $73.2 million for Q1 2021 [28] - Same property cash basis NOI in the shop segment decreased by $8.3 million from Q4 2020, while same property revenues in the shop segment declined by 4.5% due to lower occupancy [29] - Same property average monthly fees increased by approximately 2.3% compared to Q4 2020 [30] Business Line Data and Key Metrics Changes - In the shop segment, occupancy declined to 69.5% in Q1 2021, down 320 basis points from Q4 2020, but showed signs of recovery with March occupancy increasing to 70.5% and April to 70.8% [14][30] - The office portfolio's same property occupancy was 93.6%, a 10 basis point decrease from both sequential and year-over-year quarters, but consolidated occupancy increased by 90 basis points sequentially [21][22] - The company executed 26 new and renewal leases totaling approximately 213,000 square feet with a weighted average lease term of 10.6 years and roll-up rents of 18.7% [22] Market Data and Key Metrics Changes - The company reported a 24% increase in move-ins in the shop segment relative to Q4 2020, with a significant increase in leads and referrals [12] - The leasing pipeline across the portfolio was healthy at 1.6 million square feet, slightly higher than the previous quarter and above the 2019 average [24] Company Strategy and Development Direction - The company plans to transition management of 108 communities to a diverse group of best-in-class operators, aiming to complete these transitions by year-end [15][16] - The RMR group will take control of major renovations and repositioning activities at all Five Star managed senior living communities [18] - The company is focused on stabilizing its senior living portfolio and maximizing shareholder value through strategic investments and management transitions [61] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about the recovery of the shop segment, supported by vaccination efforts and a decrease in COVID-19 cases [9][10] - The company noted that senior living construction activity has slowed, which is expected to reduce new supply and stabilize occupancy rates [13] - Management highlighted strong leasing activity and a notable increase in move-ins, indicating a positive trend in the operating environment [47][48] Other Important Information - The company spent $51.9 million on capital improvements in Q1 2021, with expectations for capital expenditures in 2021 to be between $250 million and $290 million [32][33] - The company has approximately $310 million in cash set aside for the redemption of senior notes and an additional $843 million on hand for liquidity needs [34] Q&A Session Summary Question: Transitioning of the 108 senior living facilities - Management has not identified any properties for sale at this point and is optimistic about the operators being considered for the transition [38] Question: New contracts for transitioned properties - New management contracts are expected to be similar to existing contracts with Five Star, as negotiations are still in early stages [39] Question: Property acquisition in Maryland - The property acquisition is being evaluated for potential redevelopment options, including conversion to a hotel or life sciences facility [42] Question: Confidence in new operators improving results - Management believes the selected properties are not weak but rather suited for operators who excel in managing smaller communities with higher care needs [50] Question: Potential delays in transitions - Transitioning managers is expected to be smoother than previous transitions from leased to managed relationships, as licenses do not need to be changed [54] Question: Changes to the management agreement - Management discussed the importance of incentive fees to motivate operators and the rationale behind the changes made to the management agreement [56] Question: Accountability for performance - Management acknowledged past challenges but emphasized ongoing efforts to stabilize the portfolio and maximize shareholder value [62]

Table of Contents Title Of Each Class Trading Symbol(s) Name Of Each Exchange On Which Registered Common Shares of Beneficial Interest DHC The Nasdaq Stock Market LLC 5.625% Senior Notes due 2042 DHCNI The Nasdaq Stock Market LLC 6.25% Senior Notes due 2046 DHCNL The Nasdaq Stock Market LLC Large Accelerated Filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPO ...

Financial Data and Key Metrics Changes - The company reported normalized FFO attributable to common shareholders of $0.09 per share, which was $0.03 per share higher than the third quarter [29] - Interest expense was $57.8 million for the fourth quarter, consistent with the third quarter but increased approximately $14.5 million year-over-year [32] - The company had $74 million of cash at December 31, 2020, and following recent transactions, had $800 million available on its revolving credit facility, which remains undrawn [28] Business Line Data and Key Metrics Changes - Same property SHOP average occupancy declined to 72.7% in the fourth quarter, down 320 basis points sequentially [14] - Same property revenues in the SHOP segment were down 2.1% from the third quarter, driven by lower occupancy, while same property average monthly rates were up 70 basis points compared to the third quarter [30] - The office portfolio's same property occupancy was 93.7%, a 70 basis point increase over the third quarter [20] Market Data and Key Metrics Changes - The company executed 413,000 square feet of new and renewal leases during the fourth quarter, more than doubling the previous quarter's results [21] - Rent collections in the office portfolio were approximately 99% during the fourth quarter and in January and February [34] - The triple net senior living portfolio represented 10% of fourth quarter NOI, with rent coverage of 1.61x in aggregate as of the third quarter of 2020 [24] Company Strategy and Development Direction - The company shifted its strategy in 2020 due to COVID-19, focusing on supporting tenants and safeguarding health in senior living communities [9] - The company plans to reposition its portfolio and invest capital to recover from COVID-19 impacts, with no current plans for dispositions beyond a few properties [38] - The company is optimistic about post-COVID demographic tailwinds supporting growth and improved profitability [12] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding vaccination progress in senior living communities and the potential for a return to normalcy [35] - The company noted a favorable supply-demand dynamic in the senior living industry as construction starts slowed and inventory growth is expected to moderate in 2021 [19] - Management highlighted the critical need for socialization and quality care in senior living communities, especially in light of studies linking social isolation to health risks [18] Other Important Information - The company amended its credit facilities to provide waivers of most financial covenants through June 2022 and extended the maturity of the revolving credit facility into January 2024 [27] - The company spent $64.7 million on capital expenditures in the fourth quarter, with a significant portion allocated to recurring building improvements [33] Q&A Session Summary Question: What might be a reasonable expectation for dispositions in 2021? - Management indicated that cap rate expectations remain around 8% and mentioned one property under agreement for sale, with a focus on repositioning the portfolio rather than extensive dispositions [37][38] Question: How do discussions go between DHC and Five Star regarding property sales? - Management confirmed regular discussions with Five Star's senior management to identify underperforming properties for potential sale, ensuring no competition with other communities [39] Question: Is there any situation in which the company would have to return any of the CARES Act funds? - Management expressed confidence that there is little risk of having to return the CARES Act funds, with some money still on the balance sheet awaiting recognition [40]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-15319 DIVERSIFIED HEALTHCARE TRUST (Exact Name of Registrant as Specified in Its Charter) Maryland 04-3445278 (State of Organization) (IRS Employer Identification N ...

Diversified Healthcare Trust (NASDAQ:DHC) Q3 2020 Earnings Conference Call November 5, 2020 10:00 AM ET Company Participants Michael Kodesch - Director, IR Jennifer Francis - President & COO Richard Siedel - CFO & Treasurer Conference Call Participants Vikram Malhotra - Morgan Stanley Bryan Maher - B. Riley Securities, Inc. Michael Carroll - RBC Capital Markets Kyle Bauser - Colliers Securities Joshua Dennerlein - Bank of America Merrill Lynch Operator Good day, and welcome to the Diversified Healthcare Tru ...

Table of Contents Title Of Each Class Trading Symbol(s) Name Of Each Exchange On Which Registered Common Shares of Beneficial Interest DHC The Nasdaq Stock Market LLC 5.625% Senior Notes due 2042 DHCNI The Nasdaq Stock Market LLC 6.25% Senior Notes due 2046 DHCNL The Nasdaq Stock Market LLC Large Accelerated Filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPO ...

Table of Contents Title Of Each Class Trading Symbol(s) Name Of Each Exchange On Which Registered Common Shares of Beneficial Interest DHC The Nasdaq Stock Market LLC 5.625% Senior Notes due 2042 DHCNI The Nasdaq Stock Market LLC 6.25% Senior Notes due 2046 DHCNL The Nasdaq Stock Market LLC UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2020 OR ☐ ...

Diversified Healthcare Trust (NASDAQ:DHC) Q2 2020 Earnings Conference Call August 6, 2020 10:00 AM ET Company Participants Michael Kodesch - Director, IR Jennifer Francis - President and COO Richard Siedel - CFO Conference Call Participants Jason Idoine - RBC Capital Markets Bryan Maher - B. Riley FBR Aaron Hecht - JMP Securities Operator Good morning and welcome to the Diversified Healthcare Trust Second Quarter 2020 Financial Results Conference Call. All participants will be in a listen-only mode. [Operat ...

[PART I. Financial Information](index=3&type=section&id=PART%20I.%20Financial%20Information) This section provides the unaudited condensed consolidated financial statements and management's discussion and analysis for the three months ended March 31, 2020 [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements.) This section presents the unaudited condensed consolidated financial statements for Diversified Healthcare Trust for the three months ended March 31, 2020 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2020, total assets increased slightly to **$6.70 billion**, while total liabilities rose to **$3.92 billion**, leading to a decrease in total equity to **$2.79 billion** Condensed Consolidated Balance Sheets (in thousands) | Account | March 31, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total Assets** | **$6,703,723** | **$6,653,826** | | Total real estate properties, net | $5,822,344 | $5,890,785 | | Assets of properties held for sale | $244,881 | $209,570 | | Cash and cash equivalents | $69,545 | $37,357 | | **Total Liabilities** | **$3,916,554** | **$3,776,776** | | Unsecured revolving credit facility | $585,000 | $537,500 | | Senior unsecured notes, net | $1,821,560 | $1,820,681 | | **Total Equity** | **$2,787,169** | **$2,877,050** | [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Total revenues significantly increased to **$442.5 million** for Q1 2020, primarily due to the Five Star restructuring, though net income attributable to common shareholders decreased to **$9.7 million** Q1 2020 vs Q1 2019 Performance (in thousands, except per share data) | Metric | Three Months Ended March 31, 2020 | Three Months Ended March 31, 2019 | | :--- | :--- | :--- | | Total revenues | $442,467 | $266,286 | | - Rental income | $110,498 | $158,241 | | - Residents fees and services | $331,969 | $108,045 | | Total expenses | $405,744 | $213,288 | | Net income | $11,143 | $31,504 | | **Net income attributable to common shareholders** | **$9,735** | **$30,082** | | **EPS (basic and diluted)** | **$0.04** | **$0.13** | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities increased to **$56.3 million** in Q1 2020, while net cash used in investing activities decreased, and financing activities shifted to a net cash inflow Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2020 | Three Months Ended March 31, 2019 | | :--- | :--- | :--- | | Net cash provided by operating activities | $56,312 | $41,515 | | Net cash used in investing activities | ($26,641) | ($43,308) | | Net cash provided by (used in) financing activities | $3,341 | ($13,526) | | **Increase (decrease) in cash** | **$33,012** | **($15,319)** | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail real estate activities including **$11.2 million** in impairment charges, **$3.5 billion** in total debt, the Five Star restructuring resulting in a **$22.9 million** gain, and **$4.8 million** in COVID-19 related rent deferrals - In Q1 2020, the company recorded net impairment charges of **$11.2 million**, primarily to adjust the carrying values of senior living communities and medical office properties classified as held for sale[37](index=37&type=chunk)[38](index=38&type=chunk) - During Q1 2020, eight medical office properties were sold for an aggregate price of **$17.6 million**, resulting in a net gain of **$2.8 million**[40](index=40&type=chunk)[41](index=41&type=chunk) - Effective January 1, 2020, all existing master leases with Five Star were terminated and replaced with new management agreements, resulting in a gain on lease termination of **$22.9 million**[84](index=84&type=chunk)[86](index=86&type=chunk) - Due to the COVID-19 pandemic, the company granted rent deferrals totaling **$4.8 million** to certain tenants as of May 4, 2020, generally scheduled for repayment in 12 monthly installments starting September 2020[49](index=49&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Management discusses the significant impact of the COVID-19 pandemic, leading to increased operating expenses, occupancy challenges, and capital conservation measures, alongside segment-specific financial results and liquidity analysis [Impact of COVID-19](index=25&type=section&id=Impact%20of%20COVID-19) The COVID-19 pandemic has severely impacted the business, particularly the SHOP segment, leading to increased costs, occupancy challenges, and the implementation of capital conservation measures including dividend reduction and capex deferrals - As of April 30, 2020, **46 properties**, primarily in the SHOP segment, had confirmed resident COVID-19 cases[122](index=122&type=chunk) - Capital conservation measures implemented in response to the pandemic include reducing the quarterly cash dividend to **$0.01 per share**, saving approximately **$33.3 million** per quarter, and deferring up to **$150.0 million** in non-essential capital investments for 2020[124](index=124&type=chunk) - As of May 4, 2020, the company granted rent deferrals totaling **$4.8 million** to tenants, representing approximately **8.5%** of annualized rental income, with repayment generally scheduled in 12 monthly installments starting September 2020[126](index=126&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) For Q1 2020, total Net Operating Income (NOI) decreased by **15.6%** to **$125.9 million**, with the SHOP segment experiencing a **22.8%** decline due to the Five Star restructuring and higher operating expenses NOI by Segment (in thousands) | Segment | Q1 2020 | Q1 2019 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Office Portfolio | $66,064 | $71,044 | ($4,980) | (7.0)% | | SHOP | $48,090 | $62,313 | ($14,223) | (22.8)% | | Non-Segment | $11,728 | $15,707 | ($3,979) | (25.3)% | | **Total NOI** | **$125,882** | **$149,064** | **($23,182)** | **(15.6)%** | - The significant increase in SHOP segment revenues (from **$147.4 million** to **$332.0 million**) and property operating expenses (from **$85.0 million** to **$283.9 million**) was primarily due to the Five Star restructuring, converting previously leased properties to managed properties and bringing their operations onto DHC's income statement[167](index=167&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) [Non-GAAP Financial Measures](index=36&type=section&id=Non-GAAP%20Financial%20Measures) While FFO attributable to common shareholders increased to **$91.3 million** (**$0.38 per share**), Normalized FFO decreased to **$69.3 million** (**$0.29 per share**), reflecting weaker core operating performance after adjustments FFO and Normalized FFO per Share | Metric per Share | Three Months Ended March 31, 2020 | Three Months Ended March 31, 2019 | | :--- | :--- | :--- | | Net income attributable to common shareholders | $0.04 | $0.13 | | FFO attributable to common shareholders | $0.38 | $0.34 | | Normalized FFO attributable to common shareholders | $0.29 | $0.37 | | Distributions declared | $0.15 | $0.39 | [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is supported by operating cash flows and its revolving credit facility, with **$69.5 million** cash and **$415.0 million** available on its revolver as of March 31, 2020, alongside recent debt redemptions and rating downgrades - As of May 6, 2020, the company had **$775.0 million** outstanding and **$225.0 million** available under its **$1.0 billion** revolving credit facility[55](index=55&type=chunk)[124](index=124&type=chunk) - In March 2020, S&P downgraded the company's issuer credit rating from BB+ to BB and its unsecured debt rating from BBB- to BB+, increasing interest rate premiums on its revolving credit facility and term loans effective April 1, 2020[231](index=231&type=chunk)[54](index=54&type=chunk) - In April 2020, the company redeemed all of its **$200.0 million** 6.75% senior notes due 2020 using cash on hand and borrowings from its revolving credit facility[234](index=234&type=chunk)[59](index=59&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) The company's primary market risk is interest rate changes on its **$1.035 billion** floating-rate debt, where a **1%** increase would raise annual interest expense by approximately **$10.4 million**, while also managing **$2.54 billion** in fixed-rate debt Debt Profile as of March 31, 2020 (in millions) | Debt Type | Principal Balance | Description | | :--- | :--- | :--- | | Fixed Rate Debt | $2,537.2 | Includes senior unsecured notes and mortgage notes | | Floating Rate Debt | $1,035.0 | Includes $585M on revolver, $250M term loan, and $200M term loan | - A hypothetical one percentage point increase in interest rates would increase the company's annual interest expense on its outstanding floating-rate debt by approximately **$10.4 million**, impacting annual earnings per share by about **$0.04**[261](index=261&type=chunk)[262](index=262&type=chunk) - The company notes that LIBOR, the benchmark for its floating-rate debt, is expected to be phased out in 2021, requiring revisions or amendments to its credit agreements for an alternative interest rate[266](index=266&type=chunk) [Item 4. Controls and Procedures](index=47&type=section&id=Item%204.%20Controls%20and%20Procedures.) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2020, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of the end of the period, the company's management concluded that its disclosure controls and procedures are effective[267](index=267&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended March 31, 2020, that have materially affected, or are reasonably likely to materially affect, internal controls[268](index=268&type=chunk) [PART II. Other Information](index=54&type=section&id=PART%20II.%20Other%20Information) This section outlines significant risk factors, including the substantial impact of the COVID-19 pandemic, and details on unregistered sales of equity securities [Item 1A. Risk Factors](index=54&type=section&id=Item%201A.%20Risk%20Factors.) The COVID-19 pandemic is highlighted as a primary risk, causing increased operating costs, decreased occupancy, potential tenant defaults, and challenges in debt covenant compliance, alongside delays in asset sales and potential long-term demand shifts - The COVID-19 pandemic is expected to have a substantial and lasting adverse impact on business, operations, and liquidity, with senior living communities facing increased costs and downward pressure on occupancy[291](index=291&type=chunk)[293](index=293&type=chunk) - The company has reduced its quarterly dividend to **$0.01 per share** and warns that future distributions may remain at this level, be eliminated, or be paid in a form other than cash to preserve liquidity[302](index=302&type=chunk)[303](index=303&type=chunk) - Planned asset sales intended to reduce leverage are expected to be delayed until 2021 or may not occur, potentially at prices lower than anticipated, due to market conditions[307](index=307&type=chunk) - The company may need waivers or amendments from lenders to avoid defaulting on financial covenants in its credit facility due to the pandemic's economic impact[312](index=312&type=chunk)[313](index=313&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) During Q1 2020, the company purchased **3,438** of its common shares at a weighted average price of **$6.22** per share to satisfy tax withholding obligations for former officers and employees Issuer Purchases of Equity Securities (Q1 2020) | Month | Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | January 2020 | 1,938 | $8.10 | | March 2020 | 1,500 | $3.79 | | **Total** | **3,438** | **$6.22** | [Item 6. Exhibits](index=59&type=section&id=Item%206.%20Exhibits.) This section lists all exhibits filed with the Form 10-Q, including corporate governance documents, debt indentures, officer certifications, and interactive data files

Financial Data and Key Metrics Changes - In Q1 2020, the normalized FFO attributable to common shareholders was $0.29 per share, a decrease of $0.01 from the previous quarter and down $0.08 from the same quarter last year, primarily due to the restructuring transaction with Five Star and the effects of COVID-19 [12] - As of March 31, the debt to adjusted EBITDA ratio was 7.4x, consistent with the previous quarter [33] Business Line Data and Key Metrics Changes - The Office portfolio segment, which includes medical office and life science properties, represented approximately 53% of DHC's NOI for Q1 2020, with strong leasing results reported despite COVID-19 [13] - Over 302,000 square feet of new and renewal leases were executed in Q1 2020, with a 16% roll-up in rents and a weighted average lease term of 7.7 years [14] - The same-property shop segment revenues were down 140 basis points, with EBITDA for the same-property shop portfolio down 14.4% from the prior year quarter [27] Market Data and Key Metrics Changes - Approximately 86% of the office portfolio's May rents due were collected by the first three business days of May, consistent with April's collection rate of approximately 99% [17] - The average occupancy for the same-property shop segment was reported at 83.3%, with a decrease in in-person tours due to COVID-19 restrictions [28] Company Strategy and Development Direction - The company is committed to its asset disposition program, targeting $900 million in property sales, with $64.6 million already completed in 2020 [30] - DHC is deferring $150 million of previously budgeted capital expenditures while still planning to invest approximately $160 million in properties for the remainder of the year [35] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the COVID-19 pandemic, emphasizing the importance of health and safety protocols in their communities [10][11] - The company expects occupancy to drop by 40 to 50 basis points per week, depending on the duration of the pandemic [41] Other Important Information - As of April 30, there were 350 confirmed resident cases of COVID-19 across 46 communities, representing less than 1.5% of the total resident population [26] - Rent deferrals granted in the office portfolio segment amounted to $1.7 million, representing 1.4% of the recurring monthly cash revenue expected to be collected [22] Q&A Session Summary Question: Future of senior housing and regulatory changes - Management indicated that social distancing measures will likely remain in place for senior living, with increased regulations anticipated [40] Question: Occupancy trends and projections - Management projected occupancy could drop by 40 to 50 basis points per week, depending on the pandemic's progression [41][42] Question: Need for additional capital - Management expressed confidence in current liquidity but acknowledged uncertainty due to the pandemic, indicating readiness to access additional capital if necessary [44]