Delivering Innovative Solutions for a Dynamic Market.

For more than a decade, we have applied innovative business strategies to deliver reliable, stable growth for our shareholders through focused investment in seniors housing and healthcare real estate assets. We have created a balanced portfolio of high-quality assets, boasting greater diversification across all key measures – geography, asset type, tenant/manager mix, revenue source and operating model. We have customer relationships with more than 100 regional and national care providers, among them the largest and most experienced  tenant/managers in each of their sectors: Atria Senior Living, Inc., Kindred Healthcare, Inc. (NYSE: KND), Sunrise Senior Living, Inc. (NYSE: SRZ) and Brookdale Senior Living Inc. (NYSE: BKD). Long-term, triple-net leases with our tenants provide additional stability and reliability to future cash flows, while management contracts enable us to enjoy the growth inherent in seniors housing operating assets. 70% of our net operating income comes from private pay, non-government sources. And, through strategic acquisitions we are now the largest owners of private pay seniors housing properties in the United States.

Central to our success is an experienced management team skilled at executing transactions of all sizes and managing risk. Our team is committed to maintaining a strong, “all-weather” balance sheet and excellent liquidity. This allows us to preserve value for stakeholders during downtimes and to capitalize on strategic opportunities as they arise. Since 2004, our team has completed approximately $14 billion in acquisitions – creating a truly diversified portfolio of leading seniors housing and healthcare properties.

Our leadership team and investment grade credit ratings position us to capitalize on significant opportunities in the seniors housing and healthcare real estate industry.

• With consolidation in the highly fragmented $1 trillion healthcare real estate market, investors increasingly will look to own publicly-held healthcare REITs. Currently, public REITs own about 8% of healthcare real estate. This provides enormous opportunity for us to continue our proven track record of financial execution, prudent risk management and reliable growth.

• Demographic forces will drive growth in healthcare spending. Aging Baby Boomers and the 85+ population are expected to grow at three times the rate of the overall population, supporting the projected increase in healthcare spending from 18% of GDP to about 20% of GDP by 2020.

• Healthcare reform legislation will benefit healthcare real estate investing: the inclusion of 32 million previously uninsured individuals into the healthcare system will increase demand for services, especially at medical office buildings, skilled nursing facilities and outpatient facilities.
  
  

Demand for seniors housing will likely outstrip the supply of new buildings, creating a favorable pricing environment. Meantime, mounting cost pressures will encourage healthcare operators – hospitals, nursing home operators and seniors housing operators – to seek to sell to well-capitalized REITs, such as Ventas, freeing up capital for their technology, investments, expansion/consolidation and short-term budget needs. Similar cost pressures, combined with the growing Baby Boomer population, will drive demand for treatment outside the hospital – a catalyst for medical office building expansion.

We see investment opportunities across our portfolio:

Private Pay Seniors Housing

Penetration rate of about 5% in top markets remains low Of income qualified elderly that don’t live with spouse or family and need help with activities of daily living (the best candidates for assisted living), only about one of three lives in seniors housing As economy recovers, demand is expected to accelerate. Supply growth expected to remain well below peak levels for the next several years

Skilled Nursing | Post-Acute Care

• Approximately 12,000 beds (or 2%) have been taken out of service over the past five years

• Many skilled nursing operators are remaking themselves to focus on short-term rehabilitation care due to higher margins generated from Medicare and private pay relative to traditional Medicaid-funded treatments

Medical Office

As baby boomers get older, the population ages and more people are insured under new healthcare legislation, demand should steadily increase for medical services. With cost containment and more medical services shifting to lower-cost outpatient settings, patient visits are expected to grow 30% over the next decade.

A solid foundation is in place – a proven strategy to deliver reliable and growing cash flows, a diversified high-quality portfolio, and an experienced management team prepared to take advantage of our strong balance sheet and creating opportunities to make strategic acquisitions with the goal of delivering shareholder value.