NHI Announces $74.3 Million SHOP Investment

Rhea-AI Summary

National Health Investors (NYSE:NHI) has acquired four senior housing properties for $74.3 million in Oklahoma and Oregon, adding 344 units to its Senior Housing Operating Portfolio (SHOP). The properties will be managed by existing partner Compass Senior Living and are expected to generate an initial yield of 7.5% after capital expenditures.

The acquisition was partially funded through the cancellation of a $9.5 million mortgage loan with an 8.5% interest rate. Year-to-date, NHI has completed investments totaling $249.2 million at an average initial yield of 8.0%. The company has additional signed LOIs worth $132.4 million and is evaluating an investment pipeline of approximately $278 million.

Positive

• Acquisition of 344 units expands SHOP portfolio significantly
• Expected initial yield of 7.5% after capital expenditures
• Strong year-to-date investment activity of $249.2M with 8.0% average yield
• Robust pipeline with $132.4M in signed LOIs and $278M under evaluation
• Strengthening relationship with existing operator Compass Senior Living

Negative

• Large capital deployment of $74.3M may impact short-term liquidity
• Yield of 7.5% is lower than the year-to-date average of 8.0%

Insights

REIT Financial Analyst

NHI's $74.3M SHOP acquisition strengthens operating portfolio with 7.5% yield, showing strategic growth in senior housing.

NHI has acquired four senior housing properties with 344 units across Oklahoma and Oregon for $74.3 million, expanding their Senior Housing Operating Portfolio (SHOP) segment. The properties will continue to be managed by existing partner Compass Senior Living, indicating strong operational continuity. The deal structure is particularly noteworthy – NHI partially funded the purchase by cancelling a $9.5 million mortgage loan that carried an 8.5% interest rate, effectively redeploying capital from a higher-yield debt instrument into direct property ownership at a slightly lower but still attractive 7.5% initial yield.

This transaction aligns with NHI's stated strategy of growing their SHOP portfolio, which typically offers more upside potential than triple-net leased properties during favorable market cycles, though with higher operational involvement. The investment metrics are solid in the current interest rate environment, with the 7.5% yield (after accounting for routine capital expenditures) providing a reasonable spread above their likely cost of capital.

The acquisition fits into NHI's broader investment momentum for 2025, which now totals approximately $249.2 million at an average initial yield of 8.0%. Their active pipeline remains robust with $132.4 million under signed LOIs at approximately 8.1% yield, plus an additional $278 million in potential investments under evaluation. This level of pipeline activity suggests the REIT continues to find attractive deployment opportunities in the senior housing sector despite competitive market conditions.

MURFREESBORO, TN / ACCESS Newswire / October 2, 2025 / National Health Investors, Inc. (NYSE:NHI) announced today that it has invested $74.3 million, including transaction costs, for the acquisition of four properties with 344 units in Oklahoma and Oregon. The properties and healthcare operations will be included in NHI's Senior Housing Operating Portfolio ("SHOP") segment and will continue to be managed by Compass Senior Living which is an existing relationship for NHI. The purchase price was partially funded by the cancellation of a $9.5 million mortgage loan with an 8.5% interest rate. The communities are expected to generate an initial yield of approximately 7.5% after routine capital expenditures.

Eric Mendelsohn, President and CEO commented, "We have been exploring avenues to grow with Compass since our first investment with them last year, so we are thrilled to announce the expansion of this relationship which significantly adds to our SHOP portfolio. Our pipeline activity continues to be strong and focused primarily on senior housing assets supporting growth in the SHOP portfolio."

Dennis Garboden, President of Compass Senior Living, said "We've appreciated the opportunity to work with NHI on this transaction, and are excited about the road ahead for these excellent four locations."

Investment Activity and Pipeline

NHI has completed investments of approximately $249.2 million year-to-date in 2025 at an average initial yield of 8.0%. The Company currently has approximately $132.4 million under signed LOIs at an average yield of approximately 8.1%. In addition, NHI is evaluating an incremental investment pipeline of approximately $278 million excluding large portfolio deals.

About National Health Investors

Incorporated in 1991, National Health Investors, Inc. (NYSE:NHI) is a real estate investment trust specializing in sale, leasebacks, joint-ventures, senior housing operating partnerships, and mortgage and mezzanine financing of need-driven and discretionary senior housing and medical investments. NHI's portfolio consists of independent living, assisted living and memory care communities, entrance-fee retirement communities, skilled nursing facilities, and specialty hospitals. For more information, visit www.nhireit.com.

About Compass Senior Living

Compass Senior Living is a senior living operator formed in 2013 by co-founders Dennis Garboden and Will Forsyth. Compass currently operates 39 locations in 10 states, with its portfolio comprised of senior living communities offering independent living, assisted living, and memory care.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding the completion and timing of the proposed offering of securities by the Company and the intended use of net proceeds of such offering, and similar statements, including, without limitation, those containing words such as "may", "will", "should", "believes", "anticipates", "expects", "intends", "estimates", "plans", "projects", "target", "likely" and other similar expressions are forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from those projected or contemplated in the forward-looking statements. Such risks and uncertainties include, among other things: the operating success of our property managers, tenants and borrowers for collection of our lease and interest income; the risk that our property managers, tenants and borrowers may become subject to bankruptcy or insolvency proceedings; risks related to the concentration of a significant percentage of our portfolio to a small number of tenants; actual or perceived risks associated with pandemics, epidemics or outbreaks on our property managers', tenants' and borrowers' businesses and results of operations; risks related to governmental regulations and payors, principally Medicare and Medicaid, and the effect that lower reimbursement rates would have on our tenants' and borrowers' business; the risk that the cash flows of our property managers, tenants and borrowers would be adversely affected by increased liability claims and liability insurance costs; the risk that we may not be fully indemnified by our property managers, lessees and borrowers against future litigation; the success of property development and construction activities, which may fail to achieve the operating results we expect; the risk that the illiquidity of real estate investments could impede our ability to respond to adverse changes in the performance of our properties; the concentration of our investments in healthcare properties; inflation and increased interest rates; adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults, or non-performance by financial institutions; adverse geopolitical developments; operational risks with respect to our senior housing operating portfolio structured communities; risks related to our ability to maintain the privacy and security of our information; risks related to environmental laws and the costs associated with liabilities related to hazardous substances; the risk of damage from catastrophic weather and other natural or man-made disasters and the physical effects of climate change; the success of our future acquisitions and investments; our ability to reinvest cash in real estate investments in a timely manner and on acceptable terms; our ability to retain our management team and other personnel and attract suitable replacements should any such personnel leave; the risk that our assets may be subject to impairment charges; the potential need to incur more debt in the future, which may not be available on terms acceptable to us; our ability to meet covenants related to our indebtedness which impose certain operational limitations and a breach of those covenants could materially adversely affect our financial condition and results of operations; our dependence on revenues derived mainly from fixed rate investments in real estate assets, while a portion of our debt bears interest at variable rates; and our dependence on the ability to continue to qualify for taxation as a real estate investment trust and other risks which are described under the heading "Risk Factors" in Item 1A in our Form 10-K for the year ended December 31, 2024 and our Form 10-Q for the quarter ended June 30, 2025. Many of these factors are beyond the control of NHI and its management. NHI assumes no obligation to update any of the foregoing or any other forward looking statements, except as required by law, and these statements speak only as of the date on which they are made. Investors are urged to carefully review and consider the various disclosures made by NHI in its periodic reports filed with the Securities and Exchange Commission, including the risk factors and other information in the above referenced Form 10-K. Copies of each filing may be obtained from NHI or the SEC.

CONTACT:

Dana Hambly, Vice President, Investor Relations
Phone: (615) 890-9100

SOURCE: National Health Investors

View the original press release on ACCESS Newswire

FAQ

How much did NHI invest in its latest SHOP acquisition?

NHI invested $74.3 million, including transaction costs, to acquire four properties with 344 units in Oklahoma and Oregon.

What is the expected yield on NHI's new SHOP investment?

The communities are expected to generate an initial yield of 7.5% after routine capital expenditures.

Who will manage NHI's newly acquired properties?

The properties will be managed by Compass Senior Living, an existing operating partner of NHI.

What is NHI's total investment pipeline value for 2025?

NHI has $132.4 million under signed LOIs at an 8.1% average yield and is evaluating an additional pipeline of $278 million, excluding large portfolio deals.

How much has NHI invested year-to-date in 2025?

NHI has completed investments of approximately $249.2 million year-to-date in 2025 at an average initial yield of 8.0%.