Hello, everyone. Thank you for joining us, and welcome to the American Healthcare REIT Q1 2026 Earnings Conference Call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Alan Peterson, Vice President of Investor Relations and Finance. Alan, please go ahead. Good morning. Thank you for joining us for American Healthcare REIT's first quarter 2026 earnings conference call. With me today are Jeffrey Hanson, Chairman and Interim CEO and President; Gabe Willhite, Chief Operating Officer; Stefan Oh, Chief Investment Officer; and Brian Peay, Chief Financial Officer. On today's call, Jeff, Gabe, Stefan, and Brian will provide high-level commentary discussing our operational results, financial position, our increased 2026 guidance, and other recent news relating to American Healthcare REIT. Following these remarks, we will conduct a question-and-answer session. Please be advised that this call will include forward-looking statements. All statements made during this call, other than statements of historical fact, are forward-looking statements that are subject to numerous risks and uncertainties that could cause actual results to differ materially from those projected in these statements. Therefore, you should exercise caution in interpreting and relying on them. I refer you to our SEC filings for a more detailed discussion of the risks that could impact our future operating results, financial position, and prospects. All forward-looking statements speak only as of today, May 8th, 2026, or such other dates as may otherwise be specified. We assume no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. During the call, we will discuss certain non-GAAP financial measures which we believe can be useful in evaluating the company's operating performance. These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. Reconciliations of non-GAAP financial measures discussed on this call to the most directly comparable measures calculated in accordance with GAAP are included in our earnings release, supplemental information package, and our filings with the SEC. You can find these documents as well as an audio webcast replay of this conference call on the Investor Relations section of our website at www.americanhealthcarereit.com. With that, I'll turn the call over to our Chairman, Interim CEO, and President, Jeffrey Hanson. Thanks, Alan, and good morning, everyone. Before the team gets into the quarter, I want to provide a brief update on Danny Prosky, our CEO and President. As you know, he experienced a health event in February, and he continues to recover at home. We're very pleased, by the way, to share that he underwent the only important medical procedure that was actually part of his treatment and recovery plan. That happened a couple of weeks ago. It went exceedingly well, and he's in good spirits and making strong progress at home. I'd also note that during the entirety of this interim period, he's remained fully engaged in each of our board meetings virtually, and he and I speak regularly each week on the business front. Although we don't have a definitive timeline for his re-entry, given the recent procedure, we do expect to have that clarity soon and look forward to sharing the details with you in the near term. In the meantime, AHR is advancing with full momentum, and I want to be clear about what that looks like from where I sit. As most of you already know, I served as chairman and CEO of our predecessor companies, stepping into this seat was not a transition into unfamiliar territory. To the contrary, it was a return to a business, a strategy, and a team that I know intimately and have significant track record with. Gabe, Stefan, Brian, and the broader leadership team are executing at a high level, and my role has been to lead alongside them day-to-day and full-time since Danny's event, making sure that we continue to operate with the discipline and ambition that you expect of AHR. The results you'll hear this morning reflect that fact. Q1 was another exceptionally strong quarter across core metrics, double-digit same-store NOI growth for the ninth consecutive quarter, efficient capital formation and accretive deployment, and even further strengthened balance sheet and raised full-year guidance. Rather than isolated data points, these represent the output of a strategy that we've forged together over time and a team that's executing consistently. What gives me the greatest confidence, though, is what lies beneath these numbers. AHR exists to deliver higher quality care and superior resident and patient outcomes while also striving to be the most sought-after and trusted capital partner for some of the best operators in the space. This mission, by the way, isn't a slogan. It's the operating logic that AHR fully embraces and that our people live each and every day through our strategic operating partnerships. When we get our operator relationships right, underwrite with discipline, and structure capital to support long-term performance rather than short-term optics, financial results naturally follow. Q1 is another quarter of evidence that this approach is not only effective, but that it's effective at scale. With that, I'll turn it over to Gabe and the rest of the team to walk through our operating performance. Gabe? Thanks, Jeff. Q1 2026 was another strong quarter for AHR's operating portfolio. We delivered total portfolio same-store NOI growth at 12.1%, our 9th consecutive quarter of double-digit total portfolio same-store NOI growth. That kind of sustained consistency reflects the confluence of three key things: the enduring strength of the fundamentals underpinning long-term care, the quality of our regional operating partners, and the durability of our platform. Let me say a word about the strength of those fundamentals, because I think it's important context for everything you're going to hear today. Long-term care demand is being driven by a demographic wave that is still in the early stages. The 80+ population, the core consumer of long-term care, ranging from independent living to skilled nursing, is growing at an accelerating rate as baby boomers age. Meanwhile, new supply growth across senior housing remains near historic lows. The economics of new construction don't pencil for most developers today, and that dynamic hasn't changed recently. What you get from that combination, surging demand meeting constrained supply, is a compelling operating environment our operators are experiencing right now. Occupancies surpassing prior high water marks with potential for stabilized occupancies to settle well beyond 90%, sustained rate growth, and expanding margins. We believe this trend will continue well into the next decade. Now into the quarter. Our ISHC segment, also known as Trilogy, delivered same-store NOI growth of 14.5%, with same-store occupancy averaging 91.2%, up roughly 220 basis points year-over-year. Same-store revenue growth of 6.9% was driven by both rate and occupancy improvements. A big driver of rate growth has been the continued improvement of quality mix, which now stands at 75.5% of resident days on a same-store basis, up roughly 60 basis points from a year ago and up 200 basis points on a total portfolio basis. This shift directly reflects Trilogy's continuing focus on alignment with payor sources, especially Medicare Advantage plans, who value quality outcomes and are committed to paying a rate necessary to deliver high-quality care, which, of course, is the hallmark of Trilogy's business. Trilogy's clinical reputation is what earns its strong census, and we continue to invest in maintaining and expanding it. I'm proud to report that as a result of Trilogy's consistent use of the various levers at its disposal, Trilogy same-store NOI margins have now eclipsed 20% for the first time since COVID. Congratulations to the Trilogy team for surpassing another important milestone. Turning to SHOP. Same-store NOI increased 19.7% for the first quarter. Same-store occupancy averaged 88.6%, up roughly 255 basis points year-over-year. Same-store NOI margin expanded approximately 215 basis points to 20.6%. Performance in the SHOP same-store pool reflects our approach to bottom line optimization. More specifically, the utilization of various levers available, which enable us to continuously calibrate financial performance through dynamic revenue and expense management in our operating portfolio. Early in the year, that meant building a strong occupancy foundation to combat what I view as regular seasonality pressures in our high acuity portfolio and positioning the portfolio to capture incremental demand as the selling season really gains momentum. As movement activity accelerates in the spring and into the summer, we're highly focused on managing street rates while taking a more measured, resident-focused approach to in-place pricing. This ability to adjust in real time, market by market, asset by asset, by acuity level, and even unit by unit, is absolutely central to how we seek to sustain NOI growth above historic averages over the next several years and without compromising high-quality care and outcome standards that take precedence. The operating leverage in this portfolio continues to build. As occupancy continues to push higher, each incremental dollar of revenue flows through at a disproportionately higher margin. Combined with the structural demand tailwinds I described earlier, we remain highly confident in our ability to deliver sustained double-digit NOI growth through 2026. I want to close by thanking each of our operating partners, as well as our AHR asset management teams for their unwavering commitment to the residents and the communities they serve. Trilogy Management Services, Senior Solutions Management Group, Great Lakes Management, Compass Senior Living, Heritage Senior Living, Cogir Senior Living, Priority Life Care, Heritage Communities, and WellQuest Living. Your work is the foundation of everything we're able to report today, and we thank you. With that, I'll turn it over to Stefan. Thanks, Gabe. Q1 2026 was a productive quarter for our investments team. I'm pleased to say the volume and quality of what we are seeing in the market has only increased as we move through the year. Year to date, we have closed $249.2 million of new acquisitions, all within our SHOP segment. Approximately $162.8 million of those acquisitions closed during the first quarter. This includes the five previously announced communities in California and Missouri for approximately $117.5 million, and two additional properties in Kansas that closed after our last earnings call, totaling approximately $45.3 million. Subsequent to quarter end, we closed on six more SHOP assets in Georgia and South Carolina for approximately $86.4 million, deepening our Southeast presence with one of our trusted regional operators. Every deal we do starts the same way, with a relationship. Before we spend time underwriting any asset, we've underwritten the operator first. Their commitment to resident care, how they run their buildings, how their teams have performed under varying circumstances over time. In parallel, we build a deep understanding of the market before we invest capital. That operator-first approach means that a lot of our activity comes through off-market or limited process channels, where we have a genuine informational advantage. Our trust in the operator drives our confidence to pursue opportunities alongside them, informed by real insight into execution, consistency, and alignment. This depth of conviction is simply not available to everyone underwriting the same asset in a broadly marketed process, and it is a meaningful competitive advantage in how we price risk and project returns. Our underwriting process is equally deliberate. We look at market demographics, operator expertise, acuity mix, asset age, the holistic long-term cash flow profile, and the competitive set, not simply initial yield. The goal is not near-term accretion for its own sake. It is building a portfolio of assets that will generate durable compounding NOI growth for years to come. We are highly selective, and that selectivity has served us well. What gives us added confidence heading into the back half of this year is what we are seeing from the 2025 investments we closed. Across a number of our acquisitions we completed last year, performance is already tracking ahead of our initial underwriting. That is a direct reflection of how we approach every deal from day one. The asset management plan is developed with our operating partners since they are touring and underwriting the deal alongside us. By the time we take ownership, that plan is already in motion, and our partners are executing against it. Seeing those early results come in above expectations reinforces our conviction in both the process and the operators we are deploying capital with, and it informs how we underwrite and structure new investments today. In addition to the approximately $250 million we've closed to date, we have a pipeline of over $650 million of awarded deals that have yet to close. We expect to close these well before the end of 2026 and feel very good about the quality and composition of what's in front of us. On development, our in-process pipeline totals approximately $173.9 million in expected cost, of which approximately $52.4 million has been funded to date. These are predominantly Trilogy campus expansions and independent living villa projects. They are capital-efficient growth opportunities layered onto existing operational platforms that should extend our earnings runway at attractive yields with a limited market risk. In summary, we remain well-positioned with capital available to execute quickly and efficiently, a growing network of trusted operators, and a pipeline that gives us real confidence in continued accretive deployment through the balance of this year at the very least. With that, I'll turn it over to Brian. Thanks, Stefan. Q1 2026 was another quarter of strong financial performance. I'm happy to report that these results support an increase to our full-year 2026 guidance. For the first quarter, we reported normalized funds from operation, or NFFO, of $0.50 per diluted share, representing a 31.6% growth compared to $0.38 per diluted share in Q1 2025. These results were driven primarily by the continued double-digit total portfolio same-store NOI growth, supplemented by accretion from the $950 million of acquisitions completed in 2025 that are now contributing to earnings. Our proactive, hands-on asset management approach has continued to deliver solid financial performance at the start of 2026. The strength of Q1 gives us confidence in raising our same-store NOI growth guidance for the full-year to a range of 9%-12%. At the midpoint, our updated guidance implies another year of double-digit total portfolio same-store NOI growth for the third year in a row. At the segment level, our current full-year 2026 same-store NOI growth guidance is as follows. 11%-15% growth at Trilogy, 15%-19% growth in SHOP, 0%-2% growth in outpatient medical, and a range of 2%-3% growth in our triple net lease property segment. Turning to the balance sheet, our net debt to annualized EBITDA improved to 3.0x as of March 31st, 2026, down from 3.4x at the end of 2025, as strong EBITDA growth continues to improve our already attractive leverage profile. On the capital markets front, during the first quarter and the first few days of the second quarter, we entered into forward sale agreements under our ATM program to sell approximately 8.1 million shares for $412.7 million in gross proceeds. As of today, we maintain unsettled forward agreements under our ATM program representing approximately $527.4 million in gross proceeds, assuming full physical settlement. With well over $1 billion available on our existing program, we will continue to utilize this tool opportunistically depending on how the stock is trading. I also want to highlight the credit facility amendment completed subsequent to quarter end. We increased our unsecured revolving credit facility capacity from $600 million- $800 million. We extended the maturity to April 2030, and we have two six-month extension options. As of today, there are 0 amounts outstanding on the revolver. Between our forward sale agreements and the increased and available capacity on our line of credit, we have meaningfully de-risked the execution of our external growth plans, which include the over $650 million Stefan described. This should provide us with the ability to deploy capital at scale throughout 2026. Combined, the strong organic and external growth is prompting us to increase our full-year 2026 NFFO per share guidance to a range of $2.03- $2.09 per share, up $0.04 at the midpoint, and would now reflect 20% growth in NFFO per share over 2025. As always, our guidance includes only those transactions and capital markets activity that have been completed as of today. We are entering the rest of the year from a position of strength, growing earnings, continuing to improve our already attractive leverage, creating ample liquidity, and fostering relationships with operators that continue to deliver strong performance. We remain focused on executing our mission of facilitating high-quality care and health outcomes for residents while creating long-term value for our shareholders. With that, operator, we'd like to open the line for questions. We will now begin the question-and-answer session. Please limit yourself to one question and a follow-up, two total. You'll be allowed to re-queue if you wish. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Farrell Granath from Bank of America. Farrell, please go ahead. Question. My first one is in regards to the same-store NOI growth guidance within your segments. We know that the Trilogy or Integrated Health Campus guidance was increased, but SHOP remained unchanged, and especially that all segments outperformed the midpoints of your guidance this quarter. Can you just give a little bit more color of how you're thinking about that pacing through the rest of the year, or generally if there's any baked-in conservatism? Sure. Good morning or afternoon as it is. You know, Trilogy had such a strong quarter that ultimately we felt a lot of conviction that they were going to continue to exceed. If we didn't raise guidance, then the rest of the year would've looked flat relative to or relatively flat compared to the first quarter. That was a no-brainer. On the SHOP side, you know, we still have tremendous conviction on the space. We love our operator base. We believe greatly that they can continue to deliver. If you look at the supplemental and go into the SHOP portfolio, what you'll notice is that sequentially from Q1 of 2025 to Q2 of 2025 is a pretty significant uptick. I think the NOI increased on the same store pool by a little over 9.3%. I think that's part of the reason why it gave us pause. It is only the first quarter, but as I say, we have tremendous conviction about their ability to continue to perform. Thank you. Then also my follow-up question is in regards to your sources of capital. I know you just ran through a little bit on the lowering of your leverage as well as the ATM that you have outstanding. Can you just walk me through how you think about sourcing of capital and use when you're thinking about your acquisition pipeline going forward? Yeah. Listen, you know, REITs are an interesting vehicle. Required to pay out 90% of your taxable income, the truth is it's really difficult to maintain a lot of retained earnings. Having said that, our board has decided on the dividend policy that is allowing us to retain a not inconsequential amount of retained earnings. That's the cheapest form of equity that we can source. Cheapest form of capital. That's first and foremost. Secondarily, you know, we have dedicated ourselves to a disposition program. Over time, we've been selling smaller, less strategic, lower growth assets. That's certainly a nice source of funds for us to be able to utilize for external growth, for debt paydowns, for whatever else might come up. Beyond that, on the equity side, we have been a user of the ATM in the past based on the stock price, and I think we will, again based on stock price, utilize the ATM in the future. It's an incredibly efficient vehicle for raising capital, and when you can do it on a forward basis, you can do it in a non-dilutive way. Stefan will probably, I'm certain this question will come up later, but obviously, our use of those funds, we're doing it in an immediately accretive, but more importantly in a long-term accretive fashion. Those are all the sources of equity that we're or capital. Oh, sorry. I did leave out the line of credit. We're happy at 3x debt to EBITDA. There's nothing bad that happens to us to the extent that that number continues to go lower. It really just creates dry powder. As long as we can continue to hit the earnings growth that we have projected, we do have $800 million of capacity. You know, in thinking about those as alternatives, you know, I don't think you're gonna see us run the debt up very much at all. We're committed to running the company with essentially investment credit-rated ratios because we know that it's gonna help the equity trade at its best possible multiple. Thank you so much. Your next question. Thanks, Farrell. comes from the line of Austin Wurschmidt from KeyBanc Capital Markets. Austin, please go ahead. Great. Thanks. Gabe, the Trilogy portfolio this quarter saw, you know, very strong sequential NOI pickup, you know, from all the levers that you've spoken about in the past, you know, past quarters. I think it was, you know, even better sequential growth versus what you saw last year, which was really strong. Recognizing there's a lot of moving pieces and some seasonality in this business, I guess, what does that sequential strength carry momentum into the spring and summer? Is that not necessarily the right way to think about the business? I think that's a great way to think about the business, Austin. One thing I'll point out, in 2025, there were a few things that a lot of things went right for Trilogy, many of which are repeatable. A few were one-time things. For example, we talked about the Medicare Advantage strategy and trying to find different ways to optimize our partners on that front. Last year in March, we signed a new contract with a partner that was substantially higher, opened up more residents to Trilogy facilities. It had a really strong impact on 2025 earnings. That would be a bit of a headwind for 2026. I think counterbalancing that is exactly what you're talking about, which is we're coming into the year with higher occupancy than we had last year at Trilogy, and that higher occupancy unlocks the ability to not only push rate on very full buildings within the Trilogy ecosystem that have occupancies, in some cases, at near 100% on the private pay side. It also helps us to continue the work on the Medicare Advantage strategy on prioritizing the partners that actually are willing to pay for the quality of care that Trilogy delivers. That means that at Trilogy, there are a lot of different Medicare Advantage plans you could have a contract with. Some of those are looking for the low-cost provider, some of those Medicare Advantage plans are. Some are realizing that the best way for the Medicare Advantage plan to make money is to spend, is to provide the highest quality of care to the resident to get them healthy faster, and that's exactly what Trilogy brings to the table. I'm still a big believer in Trilogy. They're still one of the best operators I've ever seen. If there are ways to pull different levers to continue to push on NOI, they'll figure out a way to do it. We have the right kind of unique alignment with our management contract with them that will reward them for their outperformance with AHR stock like we've talked about in the past as well. That's helpful. Kind of leads a little bit into my follow-up question, which is you highlighted NOI margins are now back above 20%, first time since COVID. You know, given the higher occupancy today and that ability to push rate on the private pay side of the business, I mean, what sort of the longer-term or medium-term opportunities set to drive margins across the Trilogy portfolio? Yeah, I think we did 134 basis points of margin expansion last year. That was a pretty good mark for them. I think in some ways, you could see it getting easier in 2026 as you push further ahead because the occupancy and the rate management that we're talking about. It gets a little trickier because the Medicare growth rate is decelerating a little bit. That number is triggered off of inflation. As inflation comes down, that number comes down as well. One other thing I haven't talked about yet is the development pipeline at Trilogy. Currently, if you look at what we've disclosed in our supplemental, you'll see that it skews towards IL and senior housing. Those businesses have higher margins, and as we lean into those product types and try to expand on the AL and IL side of their business, I think you'll see margin expansion as a result of asset mix shifting to more private pay as well. Helpful. Thanks for the time. Your next question comes from the line of Michael Carroll from RBC Capital Markets. Michael, please go ahead. Thanks. Gabe, I wanted to continue on that line of questioning, specifically talking about Trilogy's expansion plans in Wisconsin. I noticed that the development that was recently broke ground was in Wisconsin. I mean, should we think about the growth that Trilogy is gonna pursue in that new state largely gonna happen via development? I think that's probably the base case, Mike. What we would like to do is get to a spot where, you know the best operators have a regional presence. Why the regional presence matters is because they can get a regional director to oversee multiple different facilities and their synergies from sharing of employees and having an upward path for employees that are within your campuses. We'd love to see a concentration of Trilogy campuses in Wisconsin where we can utilize the benefits of that kind of regional strategy that have worked so well for Trilogy in the past. It's hard for Trilogy to find acquisition opportunities that allow them to run their integrated model, and we don't wanna move away from the integrated model. Maybe 75% of Trilogy's assets are purpose-built for their business. It's one of the reasons why they outperform. There's operational synergies and care synergies that come from having AL and SNF under one roof. If you have a Trilogy prototype that's been value engineered over several iterations, it's just easier to do that. I think that's the base case. We're always looking for creative solutions. The Portage campus that's in our supplemental is one of those interesting opportunities. It was actually a defunct assisted living building that went dark, and we bought that. It was a 50-unit building, which is really hard to operate. We bought that, and instead of building ground up, we added on the necessary skilled nursing component. It was a really smart way to actually lower the cost of the total development cost, and it's gonna be a good deal for us because of it. I think those opportunities we'll continue to look for, but the base case is the Trilogy prototypes. Mike, keep in mind also, the state that Trilogy has the most concentration is Indiana. They may have 7,000-8,000 beds in Indiana. Think about the total addressable market in Indiana. There are far more customers than 7,000-8,000, potential customers than 7,000-8,000 in Indiana. They can continue to grow in Indiana and all of the other states that they're in addition to Wisconsin. Yeah, no, that's helpful. I mean, just kind of sticking Wisconsin a little bit is like, how many assets do you really need to get that regional scale? Then how many developments in Wisconsin are you willing to pursue at a time? Should we think about that as one a year? Can Trilogy pursue more if they really like the success that they've been having in trying to build that necessary scale right away? We're evaluating all those things right now currently. I think, to your first question about how many do you want for a regional concentration, I think you wanna be in the 5- 6+ range in order to get there. We're committed to what we've said in the past, you know, 3- 4 new campuses a year with Trilogy. That's currently a mix of Wisconsin and its other existing assets, and partially because of the CON requirements. That's one of the other things that widens the moat for Trilogy, and it's, you know, creates the competitive advantage is that these are CON states. You need the licenses in Wisconsin. That's something that we need to manage through to make sure that we get the license in the counties that we wanna be in as well. I think it'll be incremental within the Wisconsin market as we augment it with markets that Trilogy's already identified in the markets they're currently in. Great. Thanks. Appreciate it. Your next question comes from the line of Seth Bergey with Citi. Seth, go ahead. Hey, thanks for taking my question. I guess I just wanted to dive into the $650 million kind of pipeline a little bit more. You know, just kind of geographically where those assets are located and, you know, are those primarily with existing operators? Then I guess the third point would be just, you know, have your yields that you're kind of underwriting changed at all, just given it seems to be that there are more kind of players entering the senior living space? Hey, good morning, Seth. I would say deal activity right now is very high. I mean, I think our pipeline is in great shape. Obviously, we've closed $250 million so far this year. We have another $650 million that's been awarded. It's almost exclusively in SHOP. You know, we're not surprised that we're seeing other people showing a lot of interest in this space. It's attractive. It's still in the early stages of extended demand growth. I think, you know, we're definitely in an advantageous position. Half of our deals are coming in on an off-market basis. You know, we've been able to raise capital that allows us to compete on the targeted assets that we really wanna buy. We have a good reputation as a buyer. If you look at the composition of our deals, again, higher quality, newer, primarily with existing operators that we have in our portfolio today. 100% of what we've closed so far has been with existing operators. Our pipeline is probably a mix of about 80% existing, 20% that is new. We continue to look in all the major regions that our operators are already located on. I mean, that is gonna be the primary focus is growing in the areas where they have their expertise. So, you know, it has been, the team has done a great job of identifying, sourcing, underwriting, working with our partners on these acquisitions. I think, you know, we're gonna be very pleased as we close these throughout the year. Thanks. I guess just, you know, thinking about the supply and demand picture, you know, where are you kind of acquiring at a discount to kind of replacement costs? How high do rates kinda need to move before you start to see new supply come in on the SHOP side? I mean, we're still buying at below replacement cost. You know, construction, although it's not, there's not a whole lot of it, what we're seeing is coming in at higher amounts than, you know, they continue to grow. The cost to build continues to grow. We've been very fortunate. We continue to find deals that are below replacement cost, even in primary markets where, you know, we see high barriers to entry. Pricing continues to be, you know, within our bandwidth. We're still seeing stabilized yields in the sevens, that's through continued disciplined underwriting. I think that's been paying off. Obviously, we've seen that our previous underwriting is proving out. That gives us more confidence in our underwriting going forward. One thing I'd add to that, Seth, is, you know, we've been in the SHOP business for a long time. We've been in it through cycles. On the supply side, the things that Stefan's targeting are areas where we think there's more runway before supply really picks up. That's why you don't see us really focused on Florida, which is, of course, a great state for senior housing, but one where we've seen become overbuilt right away. The pipeline that he's building is taking into account the things that you're asking about, which is when does supply really start ramping, and it's built to have a longer runway. Great. Thank you so much. Our next question comes from the line of Ronald Kamdem with Morgan Stanley. Ronald, please go ahead. Hey, great. Hey, just wanna go back to Trilogy. Obviously always optimizing for revenue, when you're thinking about sort of the occupancy trajectory and the incremental margins that are coming through, maybe can you talk about how much more upside you think you have at this point and how that's playing out? Yeah. I think on a few different fronts, Trilogy still has a lot of meat on the bone. From the occupancy perspective, even at really I think what are considered to be market leading occupancies, we're still seeing occupancy grow, especially strong in the senior housing space when this is kind of a typically downtime of the year and you can experience some seasonality. It's nice to see that Trilogy has been able to hold steady and had a really great year of occupancy growth on that front last year. I think that's gonna continue to be the case at Trilogy, where people understand that there is a market reputation for being the place that takes care of their family the best, you're gonna be a preferred provider. I think the other thing that they've really figured out is that quality will carry the day from a rate perspective as well. If you appreciate quality and the quality of care above all other things, I think you're willing to pay for that quality and the experience because you know that it costs a little bit more sometimes to deliver that. Trilogy is really leaning into the revenue management side through a proprietary software program that they developed over years in their business that prices units dynamically and can do it on a daily basis. That's based on market demand, market prices, and also leasing velocity as well as different unit attributes. The way that they're doing that I think is so far in front of where all the other senior housing operators are, by and large in the country. I think that will be a significant tailwind for them on the revenue front as well. The real question that we would be speculating on is just the velocity of those things, Ron. That's hard to predict. How quickly will occupancy continue to build when you're at higher levels? How much will rate growth continue to grow over the next year? I have extreme confidence that those two things are gonna be higher by the end of the year than they are now. At what rate, it's really hard to speculate and I think not helpful because of how speculative it is. Great. My follow-up, I mean, obviously during the quarter there was a lot of talks about the CMS proposed rate. Preliminary rate came out at 2.4%. I guess I'd just love to hear that, just how did sort of you and Trilogy react to that? Does that change anything to the business plan, not only near term, but even longer term if that rate continues to trail inflation? Does Trilogy need to do anything differently? Yeah. I think this is where people probably are the most uninformed on Trilogy's business, so I'm glad that you asked that question, Ron. I think most people assume that skilled nursing is just going to grow at an inflationary rate and that you're going to have to be stuck with it. If you've followed Trilogy for the last several years, you've seen that's not true. Their skilled nursing rate, if you look at our supplemental, is growing at 5% a year. That's ahead of where inflation is, and significantly ahead for a couple of reasons. One, a big component of their skilled nursing is private pay. The rates on private pay move much like private pay senior housing, and Trilogy has control over those rates. I would expect to outpace inflation. Even though Medicare Advantage contracts typically price off of the Medicare rate increases, what Trilogy's been able to do is select the Medicare Advantage plans and manage those relationships in a way where they are able to generate rate growth of 6.6% last quarter, well above inflation and well above what the Medicare rate was. That's because they're being more selective on who they partner with. As occupancy grows, it makes, it creates the opportunity for Trilogy to be even more selective. They've got really sophisticated systems for managing that entire process. That's one of the things that comes with scale in this industry and experience and great leadership. I think they'll You know, the 2.4% was not a surprise. That's right in line with what we expected. I think I view that more like a floor than I do a ceiling. I fully expect Trilogy to manage all of their opportunities for maximizing revenue growth within the skilled nursing side to push it beyond 2.4%. Helpful. Thank you. Your next question comes from the line of Juan Sanabria from BMO. Juan, go ahead. Just wanted to ask about the SHOP RevPOR growth, a little bit below where you were trending last year. I'm not sure if there was an impact from the typical seasonality with some discounts in the first quarter that had maybe impacted growth and how we should think about RevPOR kind of trending for the balance of the year. Yeah. First, I would say the biggest reason for the deceleration in RevPOR growth is that we changed the same-store universe, which happens once a year for us. If you looked at our 2025 same-store, the RevPOR growth there would be high fours. More in line with what we're expecting and what we're managing towards. The reason why it's lower in the same-store now is that we've shifted some non-stabilized assets into the same-store. Those assets have incredible NOI growth, but the strategy has always been build occupancy first and grow rate second. As they're building occupancy, they're a meaningful component of the NOI growth on the same-store basis, and we think it's a great way for us to add value is to grow NOI that way. The second thing I would say is it would be an oversimplification of a complex operating business to look at one number like RevPOR without the context of the expense side of the equation. What we're managing towards every quarter and every year is NOI growth. We're not managing towards just hitting an occupancy target or a RevPOR target or expense target. It's taking many different things into account and figuring out how to deliver the most NOI growth within our portfolio. For example, if we were focused on NOI, we may go out and ask our operators to focus on reducing the referral fees that we're paying for move-ins into the buildings. That would help on the expense side of the equation, but if you pass a little bit of those savings on to your residents, then it may be a headwind for RevPOR. Well, it's still gonna grow NOI and expand margin 'cause you're managing the expenses, but if you're just focused on one number, you would lose all that. By the way, that's exactly what we did. We reduced referral fees by over 20% in our portfolio year-over-year. I think that's the right thing to do. As you start to push occupancies higher, you need to look at a variety of different things to optimize for NOI. That's what we're asking our operators to do. Great. Thank you. Then, earlier in the call, you noted kind of the sources and uses to fund acquisitions, including dispositions. Just curious, there seems to be a very strong bid across the spectrum for different asset types within healthcare, including medical office. Just curious if you've thought about potentially selling assets more quickly or at a larger scale, assuming you have the ability to redeploy those proceeds to take advantage of the bid or maybe explore joint venture opportunities. Yeah. Listen, Juan, my guess is you're talking about our outpatient medical portfolio. Everything else is such a tiny little piece. You know, I think our triple net is less than 6% and shrinking every day. We're well aware of the value that is embedded in our outpatient medical segment. You know, our thinking is that all of the things, all the fundamentals that make the long-term care business really positive are equally true for outpatient medical, right? Older, aging America, you need more doctor visits. More things are happening in a outpatient medical setting than they are in hospitals. And a total lack of new supply. Having said that, you know, we haven't even underwritten an outpatient medical building in years. It continues to shrink as a piece of our portfolio. We have sold over a third of the assets in the outpatient medical segment. They were smaller, slower growth assets. We've got another handful of buildings that we're continuing to expose to the market. We have every expectation that we're gonna be able to sell those. Beyond that, we're pretty happy with our portfolio. It's nice ballast. I gotta be honest, you know, we loved having outpatient medical buildings during the pandemic. The occupancy in that segment was higher at the end of 2021 than it was at the beginning of 2021. As of now and today, we're committed to the diversified strategy of healthcare investments. I would say over, you know, everything we're buying is SHOP. As a result, we're selling a little bit more outpatient medical. As a result, that's gonna become a smaller and smaller piece of our total pie. Thank you. Your next question comes from the line of Alex Fagan with Baird. Alex, please go ahead. Thanks for taking my question. On the development strategy, is Trilogy or AHR the bigger driver of identifying where and when to start new projects? Within the development pipeline at Trilogy, I would say it's collaborative, but I think the Trilogy team is really driving the process upon identifying the opportunities and bringing them to us and for us to talk about and collaborate on and then decide which of those opportunities they've identified are the ones that we're actually gonna pursue. The development pipeline at Trilogy for new campuses, by the way, is probably 30 markets deep of areas that within Trilogy's current footprint of states, markets that they wanna be in. How do we decide from that 30 of kind of opportunities which three to pursue a year, four to pursue a year? We have to marry a few different things. One, land availability in that market that's significant so that we can build out an entire campus and actually have room for expansion to add villas if we want to at the beginning or in the future. Two, where do we have access to bed licenses? There's magic to that as well. Because Trilogy has scale, there's almost a bed license bank that they can pull from within their own ownership universe to move licenses from one campus to the next or to slide licenses from one county to the next. Those rules are complex, they're hard to navigate, and it's hard to find the licenses to do it. That's a big advantage for Trilogy that I don't think people understand on the development side. We're gonna continue to be incremental in the new campuses that we add there. I feel good that the opportunity set is really deep, and it's a multi-year development pipeline that's essentially exclusive to us. That's gonna continue for the foreseeable future. As you can imagine, you know, we're gonna help decide what makes the most sense for us as far as the commitment to development, the dollars that we're putting out, the yields that we're gonna demand in return for that. As Gabe said, it's, it's highly collaborative. Yeah, thank you for all that. Switching gears. 3- 4 developments for Trilogy, what's the appetite with maybe other operators or to do development funding? If it's not right now, what would you need to see in order to pursue those opportunities in the future? It's something that we're looking at. We haven't hit go on any new developments with other operators right now. What we're doing first is looking at our existing portfolio and taking a page from the Trilogy playbook, seeing where we have excess land in really high demand, really high occupancies, and we're expanding our existing SHOP portfolio buildings. The IRRs on those investments are the highest, I think, in our entire portfolio. The problem is it's not an unlimited amount of dollars, and it's not a major amount of dollars either. We'll do that, and we're actually using Trilogy's development capabilities to help us manage those processes. It's a great example of the synergies between the companies working for our collective benefit and the platform value that we have. With other new ground up developments, what we're thinking about is how can we expand our existing relationships, use our operating partners that have development experience, and potentially grow their presence in the markets that they're already in. We haven't found the perfect opportunity to do that just yet, but I think we're getting closer and closer to that spot. The hold up, I do think the hold up is that we're buying things below replacement cost, and that's gonna be the hold up until that shifts. We know that the demographics are gonna continue to be strong. We know that the supply is not enough to keep up with the demand that's coming over the next five and 10 years, and that we will hit max occupancy at some point. The question is, when do you really want to start developing to meet that opportunity when you have all these other opportunities in front of you that are below replacement costs? It is hard to say yes to that. Yeah. No, that's great color. Thank you for the time. Your next question comes from the line of Michael Stroyeck from Green Street. Michael, please go ahead. Thanks. Good morning. Within Trilogy, expense growth saw a pretty nice deceleration in 1Q versus recent quarters. Were there any one-timers that may have impacted expenses during the quarter or I guess anything worth calling out that may have drove that deceleration? No, it's more of a broad focus on expense management. This was in response to DSH and Medicare reimbursement, us understanding that that was coming and getting out in front of it and understanding that we needed to manage the expenses. When I say us, I mean really the Trilogy team getting out in front of it and understanding how to run their platform in the right way. We made some significant investments last year. I think this year we're gonna see the expense management really work for them and help them to expand margin further. No one-timers, though. Got it. Understood. Maybe, Gabe, just going back to a point you made on CONs. As SNF occupancy just continues to trend higher, have you seen any states actually relax Certificate of Need rules or seen any sort of indication that we could see an acceleration in supply growth across any of your markets? No. In fact, that's the exact reason why I say Trilogy has the most durable competitive moat in our entire portfolio is because if you look at skilled nursing development, their beds as a percentage of inventory being added, I think is negative and has been for several years. There's more beds coming offline than there are coming online. If there are any coming online, I would be speculating they're almost all coming from Trilogy. The supply side on that part of the business, I don't think is going to be a problem. I think that's where there's the absolute longest runway in our portfolio. The other thing that's going on there is, you know, it's really hard to develop SNF because most of them that exist are focused on Medicaid. you know, with the average Medicaid mix being 60%, 70% of a building, it's really hard for it to pencil out from a development perspective. The reason why it works at Trilogy is because they have the integrated campus, they have great relationships with hospital, and they have a disproportional amount of their residents that are on Medicare and Medicare Advantage plans, which are higher reimbursement sources. That's really hard to replicate if you're not a experienced operator with regional concentration. Your next question comes from the line of Michael Goldsmith with UBS. Michael, please go ahead. Good afternoon. Thanks a lot for taking my questions. Just, you know, I think on the last call you indicated that the non-same store pools for both Trilogy and SHOP could actually grow faster than the same store, but I guess that could be lumpy. Just how should we think about the NOI growth in the non-same store pools for Trilogy and SHOP, I guess relative to the same store pools? I think anecdotally it's not a bad supposition. You know, I think if you unpack the type of asset that we've been targeting, these are assets that are going to have a tremendous amount of internal growth. When we finally do put them into the same-store pool, you're gonna see, you know, dramatic same-store earnings growth. The stuff that we bought in 2025, you know, we've talked at length, maybe it's a building that's under-occupied, under-managed. We put our trusted operator in. You know, we bought the poster child was we bought a building that was 74% occupied from a developer. The developer built it. They were a multi-family developer. They hired an operator. They didn't like them, they fired them. They hired the next operator. They didn't like them, they fired them. They started running the building themselves. They were finally able to get out whole, get their capital back, so we bought it, and that's in a market where we have a trusted operator. That operator's running buildings for us that are 95% full. We have tremendous conviction on their ability to grow that. That's the type of asset. Not every single building is like that, obviously, but that's the type of asset that we've been targeting, and there is upside. Yeah, I think it's probably fair to say that the non-same-store is gonna grow faster than the same store. Got it. Some of your peers have reported that U.S. SHOP has gotten more competitive just given AHR doesn't disclose initial yields. Are you seeing more cap rate compression to start the year? Maybe if you could share the timing on that $650 million pipeline. Yeah. I'll start with the timing. You know, I would say that a majority of what we have in the $650 million pipeline is gonna close by the end of this quarter, with the remainder closing in the third quarter. As far as pricing, I mean, certainly, it's fair to say that the cap rates have moved, generally I'd say, you know, 25-50 basis points over the last year. It's very deal specific. I think also, for us, you know, we're buying a mix of light value add and stabilized assets. The way we're looking at it really is on the long-term cashflow durability. How, what is the projection over several years, not just over the first year? That's been, you know, consistent throughout. It has been, you know, it's been very positive us, for us, I think. We've been able to still find deals that make a whole lot of sense for us, and there are a lot of other deals out there that we continue to look at. Is that. Just while I've got you, one more. Just can you walk through what was the driver of the G&A guidance increase? Yeah, sure. It's not a bad thing, by the way. In fact, I think it's a positive. The real increase in G&A, I mean, I think I mentioned it earlier. We're always looking for talent. We're adding a little here in acquisitions, a little in accounting, and a little in asset management. Beyond that's not moving the needle very much. Beyond that, the real mover on guidance on G&A is tied to stock-based compensation, and it's two buckets. Number one is that, you know, last year we had investors approve our ability to reward our operators with outperformance with incentive compensation, and that incentive compensation was in the form of AHR stock, which gives us, you know, best-in-class alignment with those guys. We did grant some shares, and those grants are now showing up in the numbers. That's part of the increase. The other part of the increase is stock-based comp goes up when your stock price goes up, and we've been in the blessed position of having the stock price go up. The G&A guide went up. Thank you very much. Good luck in the next quarter. Thank you. There are no further questions at this time. I will now turn the call back to Jeffrey Hanson, Chairman and Interim CEO, for closing remarks. Yeah, sure. Thank you, operator. Thank you everybody for investing time and your continued support and confidence in the company. I know Danny's actually attending the call this morning as well, and that he's looking forward to reconnecting with all of you directly as soon as he's able. With that, we'll conclude the call, and have a great weekend. This concludes today's call. Thank you for attending. You may now disconnect.