Financial Data and Key Metrics Changes - The company reported normalized FFO of $0.14 per share for the second quarter of 2025, which reflects the impact of incremental quarterly interest related to $2,500,000,000 refinance debt completed earlier this year [17] - Cash revenue from new properties increased from approximately $3,400,000 in the first quarter to $11,000,000 in the second quarter, with expectations to reach approximately $17,000,000 by the third quarter [9][20] - The company recorded approximately $111,000,000 in net impairments and fair market value adjustments, primarily related to its investment in PHP [18] Business Line Data and Key Metrics Changes - The portfolio of new tenants continues to report encouraging performance trends, with increasing EBITDARM coverage ratios across asset types year over year [11] - Circle, a UK operator, reported an increase in EBITDARM coverage, while Priory maintained steady performance with EBITDARM coverage of around 2.3 times [12] - LifePoint Health reported strong top-line revenue growth driven by increased admissions, with trailing twelve-month admissions increasing by 18% year over year [14] Market Data and Key Metrics Changes - The joint venture in Germany successfully completed a refinancing transaction at a 5.1% fixed rate, demonstrating investor appetite for high-quality healthcare infrastructure in Europe [10] - In the South Florida market, HSA reported a volume improvement with discharges for the first six months of 2025 being almost 7% higher than the same period in 2024 [15] Company Strategy and Development Direction - The company aims to offer hospitals permanent capital solutions to enhance financial flexibility and operational agility, especially in light of recent Medicaid funding changes [8] - The company is focused on increasing financial flexibility through asset sales, retenanting valuable hospital real estate, and refinancing debt [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to reach total annualized cash rent of more than $1,000,000,000 by year-end 2026, supported by steady contributions from the stabilized portfolio and new operators [10] - Management noted that operators are not overly concerned about the changes in Medicaid and ACA, with expectations of potential revenue improvements [50] Other Important Information - The company has retained optionality in its strategies, including monetization of valuable hospital real estate and further debt refinancing opportunities [25] - The company is currently monitoring the performance of certain assets, particularly those with coverage issues, but remains optimistic about future resolutions [66] Q&A Session Summary Question: Can you provide some color on HSA's performance? - Management confirmed that HSA has been paying rent and is current on their obligations, expressing confidence in their ability to ramp up as expected [27][28] Question: Can you elaborate on the prospect recovery process? - Management explained that a global settlement was reached, and they expect further announcements regarding the auction of properties soon [33][34] Question: What is the status of the asset sales mentioned? - Management confirmed that the expected sales of approximately $100,000,000 are anticipated to close before year-end, primarily involving leftover properties [38] Question: How is the company addressing the changes to the inpatient-only list? - Management indicated that operators have not expressed concerns regarding the transition from inpatient to outpatient services [58] Question: What is the current status of the Columbia assets? - Management noted that while the facilities are performing well, reimbursement issues are affecting cash collection, but they expect resolution in the near future [66]