Alex Fagan

Alex Fagan asked about deal flow and how competition is evolving, specifically where cap rate compression is occurring and where pricing is holding up. He also inquired if Sabra is willing to lend to the development of new SHOP assets and if such opportunities are emerging.

Answer

Talya Nevo-Hacohen (EVP, Chief Investment Officer, and Treasurer, Sabra Health Care REIT) confirmed cap rate compression due to increased popularity and private equity involvement, but noted Sabra continues to find newer assets in solid markets at 7%-7.5% cap rates. She stated that Sabra offers a preferred equity program for developments, not lending, which carries double-digit returns with purchase options and kickers, creating a future pipeline as more deals begin to pencil.

Alex Fagan asked if NNN REIT expects cap rates to compress later in the year due to deal mix or other assumptions.

Answer

CEO Stephen A. Horn Jr. stated that expecting a slight compression in cap rates is a prudent assumption. He attributed this to operating in a highly competitive environment and the pressure from peers needing to deploy capital as the year progresses.

Alex Fagan asked NNN REIT if the expected cap rate compression later in 2026 is already visible in the Q1 pipeline, or if Q1 cap rates remain relatively flat compared to Q4 2025.

Answer

CEO Stephen A. Horn Jr. stated that Q3, Q4 2025, and Q1 2026 cap rates are all relatively flat. He noted that any deals sourced now would be for early Q2, and based on current pricing, he anticipates a slight compression of 5-10 basis points for Q2.

Alex Fagan from Baird asked how Omega Healthcare Investors' Canadian development loan compares to similar loans in the United States and if such loans are expected to be a larger part of the 2026 investment flow. He also inquired if Omega plans to convert any current senior housing in its portfolio to the RIDEA structure.

Answer

Matthew Gourmand, President of Omega Healthcare Investors, explained that the Canadian loan is unique due to substantial collateral (over 20 existing facilities) and a proven developer, unlike typical development loans with higher inherent risk. He stated that Omega is generally not keen on loans, especially development loans, but views this as a vehicle for long-term equity interest. Regarding RIDEA conversion, Gourmand noted that while there's no necessity to convert existing senior housing (as operators are cash flowing sufficiently), Omega would consider opportunistic conversions to RIDEA for compelling, healthy yields, acknowledging the increased volatility of operating exposure.

Alex Fagan asked how the Canadian development loan compares to similar loans in the United States and if it's expected to be a larger part of Omega's investment flow in 2026.

Answer

President Matthew Gourmand explained that the Canadian loan is different due to substantial collateral (over 20 existing facilities) behind it, unlike typical development deals where collateral might only be the development itself. He also highlighted the proven ability of the Canadian developer. He stated that Omega is generally not a fan of development loans and this specific deal is viewed as a loan with a vehicle for longer-term equity interest, not a precursor to a larger development loan strategy. Alex Fagan also asked if Omega plans to convert any current senior housing in its portfolio to the RIDEA structure. President Matthew Gourmand noted that while there's no necessity to convert existing senior housing assets (as current operators are paying rent sufficiently), Omega would consider opportunistic conversions to RIDEA if they offer compelling, healthy yields, acknowledging the increased volatility of operating exposure.

Alex Fagan inquired about the deal volume and competition for newer senior housing, specifically how often American Healthcare REIT competes with other public REITs, and whether there's a two-way street for sharing best practices between regional operators and Trilogy, especially for new markets like Wisconsin.

Answer

CEO Danny Prosky noted that competition with other public REITs is not frequent, as American Healthcare REIT often pursues smaller, operator-sourced transactions. CIO Stefan Oh added that about half of their pipeline consists of off-market deals, leveraging new operator partnerships like WellQuest and Great Lakes. For marketed deals, competition is a mix of REITs, private equity, and local investors. Regarding best practices, CEO Danny Prosky mentioned annual operator summits for knowledge sharing. COO Gabe Willhite confirmed that operators benefit from each other's knowledge and experience, including specific operational aspects and pricing strategies, indicating a collaborative environment.

Alex Fagan asked about the deal volume and competition for newer senior housing, specifically how often the company competes with other public REITs. He also inquired if there are any best practices from regional operators that could help Trilogy, particularly in new markets like Wisconsin, and if the knowledge exchange is a two-way street.

Answer

CEO Danny Prosky and CIO Stefan Oh stated they don't often compete with other public REITs, tending to do smaller transactions. About half of their pipeline consists of off-market deals brought by operating partners like WellQuest and Great Lakes. Competition is a mixed bag, including other private equity firms and local investors/operators. Danny Prosky and Gabe Willhite confirmed the knowledge exchange is a two-way street, citing their annual operator summit where best practices are shared, leading to cooperation and mutual benefit among operators on various operational and pricing strategies.

Alex Fagan asked about Alpine Income Property Trust's comfort level and the development stage of the luxury residential loan in Austin, the planned sale percentage of that loan, and the expected reduction in operating expenses from recently sold vacant assets.

Answer

CEO John Albright detailed the company's familiarity with residential development and confirmed the Austin project is near completion, with lot sales imminent. He indicated they might sell up to 50% of the loan. CFO Philip Mays specified that the Theater Marina sale removed $400,000 in annual expenses, with another $400,000 expected upon the sale of the former Party City.

Alex Fagan questioned Alpine Income Property Trust's comfort level with the luxury residential development loan in Austin, its current stage, the amount of the loan intended for sale, and the expected reduction in operating expenses from recently sold vacant assets.

Answer

CEO John Albright expressed comfort with the Austin loan, citing the company's experience with residential lot developments and noting the project is near completion with lot sales commencing soon. He indicated a potential sale of up to 50% of the loan. CFO Philip Mays detailed that the Theater Reno sale reduced annual expenses by approximately $400,000, with a similar reduction expected upon the sale of the former Party City property.

Alex Fagan of Baird asked whether PINE plans to sell or re-lease the vacant Party City and Cinemark properties and inquired about any termination income received from the failed theater sale.

Answer

CEO John Albright explained that while re-leasing and then selling would offer the best execution, the company is leaning toward a quicker monetization to redeploy the capital sooner for the benefit of shareholders. He also confirmed they received a small amount of termination income from the theater deal but released some of the escrow back to the buyer due to an extreme health issue.