Omega (OHI) 2026 年第三季法說會：投資激增後調升 AFFO 財測指引

Omega (OHI) 公布第三季營收成長，且 AFFO 較去年同期穩健成長，同時加快在美國專業護理機構、高齡住宅與英國照護之家的資本配置。該公司亦調升並收窄 2026 全年 AFFO 指引。

核心重點

• 2026 年第三季營收增加至 3.41 億美元，高於 3.12 億美元 的去年同期水準，主要由 3,100 萬美元來自擴大營運組合的住民費用與服務收入所推動。
• 調整後 FFO 為 2.62 億美元，即 每股 0.82 美元，而可供分配資金則為 2.5 億美元，即 每股 0.78 美元。
• Omega 調升並收窄 2026 全年調整後 FFO 指引至 每股 3.28 至 3.30 美元，高於原先的 3.22 至 3.26 美元。新的中位數 3.29 美元 意味著較 2025 年每股 3.10 美元的 AFFO 成長 6%。
• 將佛羅里達州 32 家專業護理機構轉交 PACS 營運，使首年年度合約租金增加 2,610 萬美元。管理階層預期將帶來約 每股 0.065 美元 的年化 FAD 增益。
• Omega 完成了 9.46 億美元 的季後投資，主要為一筆 8.46 億美元、以 55 家英國照護之家為擔保的抵押貸款。年初至今投資總額已達約 15 億美元。
• 資產負債表槓桿率降至 3.1 倍，固定費用涵蓋率達到 6.9 倍，且 Omega 截至季末在其 20 億美元循環信貸額度中全無借款，並持有 1.96 億美元 的現金。

關鍵財務數據

淨利下滑主要由於 2026 年第三季包含 6,000 萬美元的收購、合併與過渡相關費用，主要與將 30 家英國照護機構轉為 RIDEA 架構有關。2025 年第三季亦包含 2,800 萬美元的資產出售利得。

每股 AFFO 減少約 0.01 美元（較前一季）。Omega 將該減少歸因於約 7.75 億美元的前兩季資產出售與貸款償還，這使第三季 AFFO 減少了 880 萬美元。新投資、Saber PropCo 業務活動以及淨利息費用減少約 500 萬美元，部分抵銷了此影響。

業務與營運表現

Omega 完成了 1.81 億美元的第三季新投資，包括 1.67 億美元的房地產收購及 1,400 萬美元的房地產貸款資金撥付。收購項目包括 7,300 萬美元的專業護理機構、1,600 萬美元用於六家英國照護機構，以及 7,800 萬美元用於納入 RIDEA 架構的五處高齡住宅社區。

該公司亦投資了 4,800 萬美元，用於將 30 家英國照護機構從三淨租賃轉換為 RIDEA 架構。這些資產的覆蓋率高於 1.4 倍。管理階層計算，該交易在原先年租金基礎上額外增加了 1,250 萬美元的現金流，相當於初始收益率約 26%（以該轉換投資額計算），並具備潛在營運成長空間。

10 月將佛羅里達州 32 處機構轉移給 PACS 需支付 9,000 萬美元作為給原營運商的合約終止補償金。第一年合約租金為 5,800 萬美元，較先前水準增加 2,610 萬美元。第二年租金調漲 4.3%（約 250 萬美元），此後每年調升 2%。

Omega 於本季後最大的一筆投資為 8.46 億美元的 Foundation Partners 抵押貸款，以位於英格蘭的 55 處照護機構為擔保。該筆貸款的初始利率為 8.72%，並預計在符合監管條件後轉為租約。管理團隊預期該程序約需耗時一年。若投資組合表現改善，未來的租金重設機制有望獲取額外報酬。

Genesis 依第 11 章進行的資產出售程序亦已完成。Omega 已收回其 DIP 貸款與一筆 1.5 億美元的定期貸款，同時其主租約已轉讓給 NewGen 旗下關係企業 101 West Street。管理團隊表示，現有租約的租金與調升條款均獲保留，且該資產組合的租金覆蓋率仍高於 Omega 的整體平均水準。

管理層指引

Omega 將 2026 年調整後 FFO 指引上調至 每股 3.28 至 3.30 美元，相較於先前的 3.22 至 3.26 美元區間。修正後的展望納入了截至 11 月 3 日完成的投資，包括 8.46 億美元的 Foundation 貸款以及 PACS 過渡案。

指引的主要假設包括：

• NewGen 支付合約約定的全額租金 每季 1,330 萬美元，每季換算產生約 1,400 萬美元的直線法營收。
• Maplewood 持續支付月租金 690 萬美元，與 9 月份水準一致。
• 3.06 億美元截至 9 月 30 日未償還的貸款於第四季償付，其中包括 1.5 億美元的 Genesis 貸款。
• 每季一般及行政費用維持在約 1,400 萬至 1,550 萬美元之間。
• 該展望納入了已宣告的每季股利 每股 0.68 美元。
• 除公司特別指明者外，未納入任何額外的投資、投資組合活動、資產出售、貸款償還或資本市場交易。

管理團隊設定的槓桿率目標為低於 4 倍（在可預見的未來），相較之下，其歷史長期目標區間為經調整常態化 EBITDA 的 4 倍至 5 倍。

風險與關注重點

Omega 表示收購市場競爭激烈，美國高齡住宅與英國照護機構的資本化率比歷史水準更具侵略性。管理團隊計劃運用交易架構設計與績效掛鉤的租金重設機制，在可行情況下鎖定 10% 或以上的長期回報率。

該公司運用現金、回收資本與循環信貸借款為 Foundation 貸款提供資金。管理團隊表示，未來可透過發行股票來降低循環信貸餘額。針對 2027 年 4 月 1 日到期的 7 億美元債券，若債券市場定價持續缺乏吸引力，Omega 可能考慮結合定期貸款融資與 ATM 現價發行股權收益來因應。

管理團隊認為長期照護領域在短期內面臨實質監管變革的風險有限，但也坦承政治環境的變化可能隨時間推移而加強監管力道。該公司表示，尚未因 OBBBA 未來的潛在影響而出現顯著的投資組合營運衝擊。

Maplewood 尚未完全達到營運穩定。其紐約物業的入住率達 95%，核心投資組合為 96%，而華盛頓特區物業則為 78%。管理團隊估計全面營運穩定可能還需要一至兩年時間，但也指出具體時間點仍存在不確定性。

分析師問答重點

• 英國投資效益： 管理團隊表示，Foundation 交易案經過競爭激烈的市場招標。Omega 的執行速度與抵押貸款架構協助其順利敲定交易。該資產組合擁有高比重的自費客群，且品質被認為高於 Omega 目前英國資產的平均水準。
• 資本配置： Omega 在地理區域與交易架構上維持高度彈性。管理團隊依據不動產品質、營運商實力及可持續的風險調整後報酬，來評估美國專業護理機構、高齡住宅 RIDEA 以及英國照護機構。
• 投資案源： 這三大資產類別的投資案源儲備均維持活絡，但目前稍微偏向高齡住宅 RIDEA 與英國照護機構。美國專業護理機構市場的競爭依然高度激烈。
• 投資組合優化： 管理團隊預期未來將有更多涉及租約過渡、重新出租、轉為 RIDEA 架構以及選擇性資產出售的機會。然而，規模與 PACS 過渡案相當的交易可能較為罕見，且取決於是否有意願配合的營運夥伴。
• 資產出售： Omega 認為目前並無大規模處分投資組合的迫切需求。未來的資產出售預計將具選擇性，且更多是由定價優勢所推動，而非出於營運上的必要性。
• 貸款策略：管理階層無意僅為了利息收入而擴大放貸業務。未來的放款預期將有助於取得不動產所有權，或參與營運成長的潛在收益。

完整財報電話會議逐字稿

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完整財報電話會議逐字稿

管理層陳述

Michele Reber

Thank you, and good morning. With me today is Omega's CEO, Matthew Gourmand; CFO, Neal Ballew; CIO, Vikas Gupta; and Megan Krull, Senior Vice President, Data, Intelligence and Government Relations. Comments made during this conference call that are not historical facts may be forward-looking statements, such as statements regarding our financial projections, potential transactions, operator prospects and outlook generally.

Factors that could cause actual results to differ materially from those in the forward-looking statements are detailed in the company's filings with the SEC. During the call today, we will refer to some non-GAAP financial measures, such as Nareit FFO, adjusted FFO, FAD and EBITDA. Reconciliations of these non-GAAP measures to the most comparable measure under generally accepted accounting principles are available in the quarterly supplement. In addition, certain operator coverage and financial information that we discuss is based on data provided by our operators that has not been independently verified by Omega. I will now turn the call over to Matthew.

Matthew Gourmand

Thanks, Michele. Good morning, and thank you for joining our third quarter 2026 earnings conference call. Today, I will discuss our third quarter financial results as well as some of our recent transactions. Third quarter adjusted funds from operations, AFFO, of $0.82 per share and FAD, funds available for distribution, of $0.78 per share, reflects solid year-over-year growth. However, it should be noted that sequentially, these financial metrics were effectively flat, driven by the headwind from $563 million of asset sales late in the second quarter.

However, as we have been at pains to stress in our discussions with investors, we are managing this business to create long-term sustainable value. We believe these dispositions, which were sold at an effective 7% cap rate on cash flow, allowed us to exit assets that were going to require significant capital investment over the longer term while strengthening the underlying credit support of the related operators.

This is an example of the active portfolio management that we've spoken about in recent quarters. And we were able to show another example in the third quarter as we transitioned 32 facilities to PACS, paying a $90 million termination fee to the prior operator and increasing annual cash rents on this portfolio by $26.1 million in the first year, an effective yield of 29%. This highly accretive transaction addressed the needs of 2 long-standing operators while supporting continued quality of care for residents. And we believe there are selective opportunities to achieve similar strong accretion through further active portfolio management efforts in the coming quarters.

As we highlighted last quarter, we expected our acquisition run rate to pick up in the second half of the year, and this proved correct as we've been able to allocate over $1 billion in the second half of the year to date. As with so many of our transactions executed in recent quarters, the majority of these investments are structured to align our interests with those of our operators with our initial accretive yields not creating an undue burden on the cash flow of the facilities and with an opportunity to benefit in the upside if, as we expect, an operator improves the financial performance of the portfolio.

This philosophy of alignment of interest has been resonating with operators and managers alike, and we continue to be disciplined in our capital allocation policies, focusing on investment opportunities that provide sufficient upside that each party is able to achieve favorable economics. With an excellent cost of capital, our lowest leverage in the company's history, EBITDA coverage at the highest level in over a decade, robust secular tailwinds and a portfolio of strong operators looking to grow, we are very optimistic about our ability to create shareholder value for the foreseeable future. I will now turn the call over to Vikas.

Vikas Gupta

Thank you, Matthew, and good morning, everyone. Today, I'll review the latest performance trends across our triple net and operating portfolios, provide updates on Genesis and our recent operator transitions and discuss our investment activity and pipeline. Starting with portfolio performance. Our core triple net and mortgage loan portfolio continues to demonstrate positive operating trends. Trailing 12-month operator EBITDAR coverage as of June 30, 2026, improved to 1.67x compared to 1.65x in the prior reporting period.

Occupancy also increased slightly to 82.7% compared to 82.6% previously. Additionally, our Senior Housing Operating Portfolio, or SHOP continues to perform in line with our underwriting expectations. Turning to portfolio activity. We had 2 significant developments in October. First, the Genesis Chapter 11 bankruptcy sale was finalized, and our master lease was assumed and assigned to 101 West Street an affiliate of NewGen.

As part of the transaction, we received repayment of our DIP loan and a $150 million term loan. This represents an excellent outcome for Omega. We preserved all of our existing lease economics, resolved our loan exposure to Genesis and established a new lease relationship with an experienced operator. Importantly, the Genesis portfolio continues to generate coverage above our overall portfolio average, providing NewGen with a strong foundation as it assumes operations.

We know the principals of NewGen well, having transacted with them previously and look forward to building on that relationship over time. As Matthew mentioned, in October, we also completed the previously announced transition of 32 skilled nursing facilities in Florida from Airamid-affiliated operators to PACS, one of our largest operating partners. The facilities were added to our existing PACS master lease with first year annual contractual rent of $58 million, representing a $26.1 million increase over the prior rent.

In year 2, rent will increase by 4.3% or approximately $2.5 million, followed by annual escalators of 2% thereafter. To facilitate the transaction, Omega paid a $90 million lease termination fee to Airamid. We are pleased to support PACS' expansion into Florida, a new operating state for them. Importantly, the transaction is expected to generate approximately $0.065 per share in annualized FAD accretion, representing a highly attractive outcome for our shareholders.

I want to emphasize that this transition was not driven by performance or rent collection issues. Airamid has been a strong long-standing operator for Omega, and we greatly value their partnership. Rather, this transaction reflects the proactive approach to asset management that Matthew mentioned earlier, where we identify an opportunity to unlock additional value within our existing portfolio.

While transactions of this magnitude may be unique, we remain focused on identifying opportunities to enhance the value of our existing portfolio. These include similar lease termination and re-leasing transactions, dispositions of non-core assets at attractive cap rates and lease restructurings that allow Omega to participate in future operating upside.

Now turning to new investments. During the third quarter, we completed $181 million in new investments, consisting of $167 million in real estate acquisitions and $14 million in real estate loan fundings. Our acquisitions included $73 million of skilled nursing facilities leased to a new operator, $16 million for 6 U.K. care homes leased to an existing operator and $78 million for 5 senior housing communities placed into a RIDEA structure with an existing operating partner.

In addition, during the quarter, we invested $48 million to convert 30 U.K. care homes across 2 operator relationships from triple-net leases to RIDEA structures. These portfolios were already performing well with coverage above 1.4x, and we believe there is an opportunity to capture additional upside through the operating structure. To manage these facilities, we are partnering with 3 established U.K. operators with whom we have existing relationships.

These conversions further expand our U.K. operating platform and demonstrate our willingness to evolve our investment structures when we believe doing so can enhance long-term returns. Also during the quarter, the Saber PropCo joint venture, in which Omega owns a 49% equity interest, acquired 5 skilled nursing facilities for $88 million, funded through existing cash and third-party debt. Importantly, no additional equity was required from either Saber or Omega. This is exactly the type of opportunity we envisioned when we initially invested in Saber's real estate and operating platforms.

As Saber improves operations and stabilizes these facilities, we have the opportunity to participate in value creation at both the real estate and operating company levels. Turning to our new investment activity subsequent to quarter end. We have already completed $946 million in new investments during the fourth quarter. Our largest transaction was the Runwood U.K. investment, consisting of an $846 million mortgage loan secured by a portfolio of 55 care homes, including 7 leasehold interests located across the Southeast and Midlands regions of England.

Our borrower, Foundation Partners, is an existing Omega tenant and an established U.K. operator with a strong track record of performance in comparable portfolios. The loan carries an initial interest rate of 8.72% and is expected to convert to a lease once we exercise our purchase option following the satisfaction of customary regulatory conditions.

The initial lease yield will be consistent with the loan yield with the potential to generate additional returns through a future rent reset tied to improved portfolio performance. We believe this is an attractive investment that combines a strong initial yield with meaningful potential upside while significantly expanding our presence in the U.K. through a partnership with an operator we know well and trust. Also subsequent to quarter end, we completed approximately $100 million of additional investments across 6 senior housing communities. Five of these communities will operate under RIDEA structures with 2 third-party managers, while the sixth, a continuing care retirement community will be added to an existing operator's master lease.

In total, we have completed approximately $1.5 billion in new investments year-to-date, including more than $1.1 billion since the beginning of the third quarter. As I have outlined, these transactions span skilled nursing, senior housing and U.K. care homes and reflect our team's ability to identify attractive investment opportunities, structure transactions creatively and deploy capital alongside strong operating partners.

Finally, turning to our pipeline. We continue to see attractive market and off-market opportunities across both the U.S. and the U.K., and we remain focused on disciplined capital deployment, high-quality real estate, experienced operating partners and attractive risk-adjusted returns. Our pipeline remains strong with numerous opportunities we are actively pursuing for potential closing in the fourth quarter and early 2027. Building on our recent investment momentum and successful portfolio initiatives, we believe Omega is well positioned to continue generating attractive returns and long-term shareholder value. I'll now turn the call over to Neal.

Neal Ballew

Thanks, Vikas, and good morning. Turning to financials for the third quarter of 2026. Revenue for the third quarter was $341 million compared to $312 million for the third quarter of 2025. The year-over-year increase was primarily the result of $31 million in resident fees and services from our operating portfolio, which we continue to grow through new acquisitions and triple-net conversions.

Net income available to common shareholders for Q3 2026 was $83 million or $0.27 per diluted common share compared to $180 million or $0.59 per diluted common share for Q3 2025. The year-over-year decrease was primarily the result of $60 million of acquisition, merger and transition-related expenses in Q3 2026, substantially all related to the terminating of our leases with the operators of the 30 U.K. care homes converted to RIDEA structures and a $28 million gain on asset sales in Q3 2025.

Adjusted FFO was $262 million or $0.82 per share for the quarter and FAD was $250 million or $0.78 per share. Reconciliations of these non-GAAP measures to net income are included in our earnings release and third quarter financial supplemental posted to our website. As expected, Q3 2026 AFFO per share decreased by approximately $0.01 compared to Q2 AFFO due to the approximate $775 million in asset sales and loan repayments over the past 2 quarters, which reduced Q3 AFFO by $8.8 million.

The decrease was partially offset by incremental income from $308 million in new investments completed during the second and third quarters, $124 million in net investment activity by the Saber PropCo JV during the second and third quarters and lower net interest expense of approximately $5 million, driven by lower average revolver borrowings and higher interest income on cash balances.

Our balance sheet remains incredibly strong. Our debt is well laddered, and we have significant liquidity. During the quarter, we issued 4.7 million common shares through our ATM and DRIP programs for gross proceeds of $234 million at an average price of $49.44. At quarter end, we had no borrowings outstanding on our $2 billion revolver and $196 million in cash on hand. Our fixed charge coverage ratio was 6.9x, and our leverage decreased to 3.1x. Historically, we have targeted long-term leverage of between 4 and 5x adjusted normalized EBITDA. However, given the current rate environment and our ability to accretively fund investments through equity, we are targeting to maintain leverage under 4x for the foreseeable future.

Subsequent to quarter end, we funded the $846 million Foundation mortgage loan using a combination of balance sheet cash, capital recycled from loan repayments and borrowings on our revolver. We continue to have access to the capital markets and have ample liquidity and optionality to fund both the next scheduled debt maturity due in April 2027 and to raise capital to accretively fund the investment pipeline.

Turning to guidance. As we announced in yesterday's press release, we increased and tightened our full year adjusted FFO guidance to a range of $3.28 to $3.30 per share from our prior range of $3.22 to $3.26 per share. With that change, the midpoint of our guidance increased to $3.29 per share, a $0.05 increase over the midpoint of our July guidance. Our revised 2026 midpoint of $3.29 per share also represents a $0.19 increase over 2025 full year AFFO of $3.10. This would represent a 6% year-over-year increase in AFFO while also paying out a dividend yield of nearly 6%.

Our updated guidance reflects the $946 million of new investments completed since quarter end, including the $846 million Foundation mortgage loan as well as the transition of 32 Florida facilities to PACS, which increases annual contractual rent on those facilities by $26.1 million and annual straight-line revenue of $33.8 million in the first year.

With that said, I'd like to take a moment to highlight a few of the guidance assumptions we outlined in our earnings release. Guidance includes the impact of new investments completed through November 3rd does not include any additional investments not outlined in our press release. Guidance assumes that no additional operators are placed on a cash basis for revenue recognition, that NewGen pays its full contractual rent of $13.3 million per quarter following its assumption of our lease, which will equate to approximately $14 million in straight-line revenue per quarter and that Maplewood continues to pay monthly rent of $6.9 million, consistent with September.

Guidance assumes $306 million of loans outstanding at September 30, 2026, are repaid in Q4, including $150 million of Genesis loans. As we said at the beginning of the year, we are always seeking to prune and strengthen our portfolio, which could include $15 million to $25 million in asset sales each quarter. Guidance also assumes quarterly G&A expense of approximately $14 million to $15.5 million. And lastly, the guidance includes the dividend announced last week of $0.68 per share.

The high end of our guidance range includes, but is not limited to, additional payments from cash basis operators, exposure to our operating portfolio through RIDEA and JV investments and G&A at the lower end of the range. Our 2026 adjusted FFO guidance does not include any additional investments, portfolio activity, asset sales, loan repayments or capital market transactions other than what I just mentioned or what was included in the earnings release. I will now turn the call over to Megan.

Megan Krull

Thanks, Neal, and good morning, everyone. Fundamentals continue to be strong and reimbursement has been generally as expected this year with no notable disruptions in our portfolio related to the future impact of the OBBBA. That said, certain Senate Finance Committee minority members, along with select non-member Democrats have recently renewed their focus on quality in the long-term care sector, including the potential for increased or modified regulatory oversight.

While the recent scrutiny has been decidedly partisan in nature, the underlying focus is not new to the industry, and we currently see limited risk that these efforts will translate into meaningful regulatory change in the near term. We are, however, mindful of congressional elections and how a changing political environment could alter that calculus over the longer term.

Partnering with operators focused on quality of care is of the utmost importance to us as a REIT. At the same time, regulatory requirements need to be thoughtful and appropriately targeted to be effective. We, therefore, continue to engage with various industry associations to help ensure that the policy dialogue is grounded in a contextualized understanding of the data rather than the broad generalizations that sometimes characterize these policy debates.

We are hopeful that when the time is right, both sides of the aisle will work together to ensure that any proposed regulation or legislation is reasonable and appropriately balanced. And encouragingly, given the current and impending demographic wave, we are pleased to see leaders on both sides making current and future staffing concerns in the industry a high priority. I will now open the call up to questions.

Operator

[Operator Instructions] Your first question comes from the line of Seth Bergey with Citi.

分析師問答

Seth Bergey

I guess I just wanted to kind of dig in a little bit more to kind of the mortgage loan and just some more background on it. How did that kind of structure come to be? What's kind of the estimated time line to exercise the purchase option? How does the underwriting rent coverage compare to your existing U.K. care home portfolio? And was that an off-market transaction? Or can you just talk a little bit about how it came to be?

Vikas Gupta

Yes. This is Vikas. Yes, I'll try to cover your questions. It was a marketed transaction, a very competitive process, which I believe Omega's track record and speed helped us win the deal. And part of the speed was the mortgage loan structure, which we've done before, helped us show the seller that we could quickly close on the transaction. And similar to what we've done in the past, we plan to convert this as soon as regulatory approvals have happened, which we expect to be in about 1 year.

Coverage will be good day 1, but we believe our new operator, Foundation, who is an established operator and has operated similar portfolios before, will realize some upside through pushing acuity and rate increases. So there is when our rent reset will take effect, and we'll be able to get a return close to as if we started at 10% return.

Seth Bergey

Great. And then just how have you seen kind of the landscape change at all, if at all, with some of the move in the 10-year and kind of the number of bidders out there for assets?

Matthew Gourmand

So, so far, we haven't really seen too much, Seth. I think that clearly, there will be an impact over time, but it's happened relatively recently. So a lot of the deals that have been struck were either previously agreed to or financed. Thankfully, our cost of capital on the equity side of things remains very robust. So from our standpoint, we're just going to continue underwriting exactly as we have. It has been a very competitive environment. We've been able to obviously deploy a solid amount of capital and some very compelling investments should the competitive environment become a little less challenging, obviously, that would be great. But I don't think we're planning on that happening, and I don't think that we're relying on that to continue to deploy capital thoughtfully. So we should be okay either way.

Operator

Your next question comes from the line of Michael Goldsmith with UBS.

Michael Goldsmith

Now with Runwood, you have a very large platform in the U.K. And so just wondering, does that make it more attractive to continue to be acquiring in that market? Or it does sound like your pipeline is kind of split somewhat evenly. So just trying to get an understanding of where the next acquisition comes and does this platform that you're building in the U.K. make it more attractive to continue to build upon.

Matthew Gourmand

I don't think it changes how attractive it is. We like the U.K. very much. You've seen we've allocated a lot of capital there in the past few years. We have, over the course of a decade, curated a thoughtful pipeline of operators with whom we have strong relationships and that these are proven quality operators from a clinical standpoint and from a financial standpoint. So such that there are opportunities there, we will continue to work with our operators and managers and try to understand whether we want to do that in a triple net or RIDEA format.

In terms of the opportunities generally, we see a good amount of opportunities across the platform in all areas, and we kind of term ourselves equal opportunity capitalists. So from that standpoint, we don't start out with any premeditated expectations as to where we're going to allocate capital. We allocate each deal and underwrite each deal with a view of trying to buy quality real estate, partnering with quality operators and managers to create an accretive and sustainable yield over time. And we're just going to continue to do that. And ultimately, where we allocate capital is going to be determined through that lens.

Michael Goldsmith

And then separately, you mentioned additional lease terminations, re-leasing and restructurings of the PACS magnitude may be unique. Like how significant can we -- should we be thinking about the opportunity? And then along the same lines, right, you converted 30 homes in the U.K. to a RIDEA structure. So maybe just talk about the opportunity to -- for continued active portfolio management now that you've got a couple of pieces of evidence of what you've been able to accomplish.

Matthew Gourmand

I think the good news is that when you've got a portfolio of $12-plus billion worth of real estate, there are always opportunities. We talk about alignment of interest, and that's never more relevant than when you're looking at these situations, right? You need a willing partner on the other side to agree. And so it's very tough to quantify what it looks like in the near term. I think you know us well enough that we like to underpromise on these things.

So I think it's clearly there. We've seen a couple of examples. I think we'll see more in the next 12 months. And over the next 5 to 10 years, I think it's just going to become more and more available to us. But in terms of quantifying it, it's going to be very much determined by finding partners who want to transact in these situations. As you've seen, the yields that one is able to achieve in many of these structures are so compelling that you don't need a great deal from a dollar standpoint to be quite powerful from an earnings standpoint. So the team continue to look for opportunities, continue to engage with operators. And the only thing I can reassure you is if the opportunity is there, we're going to do it.

Operator

Your next question comes from the line of Julien Blouin with Goldman Sachs.

Julien Blouin

Yes, maybe going back to the PACS transition. I was wondering, is the limiting factor on doing more of these, the depth of the operator pool of strong partners willing and able to take on a transition like this one? Or is it rather having an existing partner who is willing to come to the table and find some arrangement to transition operators?

Matthew Gourmand

I think it's probably more the latter. The backdrop -- the operating backdrop for most of our operators right now is relatively benign. So from that standpoint, there isn't a pressing need on the part of many operators to look to transact in such a way. But I think that the appetite from our operating partners who want to continue to take on these properties is somewhat unabated. So from that standpoint, it's more of the latter than the former as we see it today.

Julien Blouin

And I was just wondering, did the election results change at all your sort of thinking around some of the regulatory risks, whether it be minimum staffing or sort of oversight of nursing homeownership -- sorry, nursing ownership, yes.

Megan Krull

It doesn't really -- I mean, we expected that this might happen that the House and the Senate might both go blue. And obviously, Democrats have a heavy concentration on regulatory changes. But we have dealt with that before in the past. It's not a new issue for us. And quite frankly, we're somewhat aligned in that the Democrats are really looking from a regulatory perspective to make sure that there's quality of care in nursing homes. And that's what we're looking for, too.

The only way that we're successful on a long-term basis because we are a long-term holder of the real estate is to make sure that we align ourselves with operators who provide quality of care, right? So then it just becomes how does that regulation get implemented and making sure that we have a voice in that to make sure that through our associations that Congress has an understanding of what the reality is and making sure that they're doing something that actually has the benefit they're looking for.

Operator

Your next question comes from the line of Rich Anderson with Cantor Fitzgerald.

Richard Anderson

Congrats, Matt, on your first call as CEO. So on Genesis, I just want to make sure I understand like the economics of your situation with NewGen, by the way, I'm glad it's not Siseneg, Genesis spelled backwards. Is it anything different than original Gen in terms of the expectation of rent growth? I guess the main question is what does $14 million gap mean in terms of escalations? And how does that compare to the previous setup?

Vikas Gupta

Rich, this is Vikas. I'll take the first part of your question, and Neal can tackle the second. So the economics from a business perspective are the same. Our lease, we are going to get the same amount of rent and escalators. And I will just add, we went into the bankruptcy with a very good coverage, and that was through some hard work on our part and Genesis' part to approach us with some buildings they wanted to exit, and we found those buildings new homes. So we went into the bankruptcy with good coverage. And now we have a new tenant who will have good coverage, and we continue to get the same economics on those.

Neal Ballew

Yeah, and...

Richard Anderson

Sure, go ahead. Sorry. Thanks, sorry. Go ahead.

Neal Ballew

I was going to say on the straight-line piece, good question. We've been asked this question in the past. We just want to give the pieces and be transparent, right? So Genesis going through bankruptcy, they were on a cash basis. But with NewGen having a good credit, they'll be on a straight-line basis. We're just trying to give you the pieces of what the straight-line GAAP revenue is going to be of that $14 million per year.

Richard Anderson

Okay. And what is your appetite to grow with them? You mentioned sort of portfolio management efforts. But are you open to growing in the future with NewGen?

Vikas Gupta

Yes. So we knew NewGen through some sale transactions we had done with them previously. But through this process, we really dug in and spent time with them. And at this point, we're generally impressed with our operating model. They have a proven locally focused business model. And we think that will work well, especially for these buildings that are spread across the U.S. So the proof is in the pudding. And if things go well, I think, yes, we would be open to more acquisition opportunities with them.

Richard Anderson

And just a quick to close out my questions. They don't have any obligations around the unsecured creditors or anything like that, that's outside of this new company. Is that correct?

Vikas Gupta

That's correct.

Operator

Your next question comes from the line of Omotayo Okusanya with Deutsche Bank.

Omotayo Okusanya

Congrats on the solid quarter and outlook. I just wanted to follow up on Michael's earlier question around the U.K. And if we kind of think U.K. versus U.S. today, where would you say you're getting the better relative value and maybe the more attractive investment spreads and leasing economics? And can you just kind of walk us through a little bit of that?

Matthew Gourmand

Sure. That's a great question. I mean it's very deal specific, right, Tayo. But we've always looked at it from a standpoint of in the U.S., you can get standardly in the SNF world, we're looking for a 10% yield, which obviously will be a gross and a net 10%. In the U.K., we're tending to look for a 10% on a gross basis, but there is a little tax friction that takes that down about 90 basis points. So inherently, there is a little bit of a headwind on a net yield standpoint there.

And then in the U.S. RIDEA, we've been pretty open in saying that given the fact that we're able to get 10% yields, in our triple-net, we're looking for more than that when we're taking the operating exposure and the volatility that comes along with that. So when you look at it strictly from a yield standpoint, I think you probably would say that if done correctly, the RIDEA portfolio probably provides the best yield, but obviously a little bit more risk, then the U.S. SNF market is probably second and the U.K. third. But that doesn't capture everything in the fact that there's also opportunities in some situations, as you've seen in the U.K. to convert some of these things over to RIDEA.

So that creates an economic pickup that probably at least matches, if not improves our yields above the standard SNF 10% with 2.5% escalators. So it's quite a nuanced thing. And then you have to think about it from a standpoint also of what's the quality of the real estate that you're getting in these situations as well. So -- we look at each deal very specifically. And as you've seen, given where we've been allocating capital over the last couple of years, we are relatively agnostic as to where that capital is allocated as long as it fits our criteria in terms of yield, quality of real estate and quality of operating or managing partner.

Omotayo Okusanya

And then on the regulatory side, any update -- I know like over the summit, there was some talk from CMS about potential recalibration of PDPM because of concerns about upcoding. Any kind of news in the past few months around those lines? Does kind of the change in the Senate and the House kind of potentially create more risk on that end in 2027? Like how do you kind of think about that?

Megan Krull

No, we haven't really heard anything on that front, neither have our industry partners.

Operator

Your next question comes from the line of Dave Rodgers with Raymond James.

Your next question comes from the line of Nick Yulico with Scotiabank.

Nicholas Yulico

First question, going back to the Airamid transition to PACS. Can you talk about the coverage on the lease previously, what it looks like now? And how much was the higher rent driven by, I guess, PACS view on a more optimistic, let's say, EBITDAR scenario for the facilities?

Vikas Gupta

Nick, it's Vikas. I'll cover that. So we don't disclose coverages by operator. But I will say the Airamid coverage was strong. And hence, we were able to charge a good bit of rent increase there. And our PACS master lease coverage is extremely strong. So the way we see it is PACS' coverage will be fine day 1. But as PACS has done before, they will find upside in these buildings. So we think ultimately, PACS' coverage with us will just improve in the long run.

Nicholas Yulico

Okay. And then, Neal, I guess just a question on the -- how to think about the balance sheet here. You talked about the fourth quarter investments, then you got the loan repayments coming in. How should we think about sort of like equity issuance over the next couple of quarters to, I guess, reduce the line balance or -- and then also, how should we think about that line balance and sort of managing floating rate debt exposure along with the debt unsecured bond you have maturing next year?

Neal Ballew

Yes. Great question. Thanks. I'd say, of course, I'd tell you that our equity is still undervalued. But given the price, we can still accretively invest. And so I think we do, as I said in the talking points, have a lot of optionality and flexibility, do have that revolver there for these instances of being able to accretively put capital to work. But you're right, at this point and given this price, you could see us issuing equity to pay down the revolver. And then looking forward to next quarter, the $700 million bond coming due April 1st, given where bond pricing is today, it doesn't look that compelling. But I think there's a scenario where you could see us do a combination of term loan and ATM proceeds to take down that bond issuance.

Operator

Your next question comes from the line of Dave Rodgers with Raymond James.

David Rodgers

Sorry about that guys. Technology issues. My Internet is down, I don't know if I get these numbers right, but I am curious. The returns on the PACS deal were pretty clear and pretty strong. I'm curious about the returns on the RIDEA buyouts in the U.K. and those conversions. I think the return on that may be a little less clear just from the way that you put it in the press release. So I was kind of curious if you could kind of talk about how you thought about some of those returns on top of what you've done in the U.S.

Neal Ballew

Yes, certainly, great question. I'll walk you through the quick math here. So in the press release, we gave you that we wrote a $48 million check to buy out those operators. And we also gave you the -- I'll give it to you in dollars, the annual rent for those 30 facilities was $26.7 million with the EBITDAR coverage of the 1.47x, the math there shows $12.5 million of cash flow after paying our rent. So effect -- in effect by us taking over these properties in the RIDEA structure, we're going to continue to get the proceeds of that rent and that $12.5 million on top. So the $12.5 million divided by the $48 million outlay is a 26% yield. I think that's the math I would think through.

Matthew Gourmand

So not quite as good, but we're still happy with it. And I would say that we do believe there's operational upside to that. So we would say that, that is kind of a conservative number.

David Rodgers

Great. That's helpful. I appreciate you running through that. And then with regard to Maplewood, it seems like they're getting pretty close to stabilization at this point. I know you guys still provide kind of the quarterly run rate for that one. But how close are we to stabilization there and getting comfortable to the point of maybe not providing the detail on Maple each quarter?

Vikas Gupta

Yes. I think let me give you some occupancy that will help you a little bit. Second Avenue, our New York property is at 95%. Our D.C. property is at 78%. And then the whole core portfolio, which includes Second Avenue in New York is 96%. So it isn't stabilized because of D.C. But again, we think of this as RIDEA effectively and all of their cash flow comes to us. As you saw quarter-over-quarter, that cash flow continues to increase. We still have a few years until we stabilize or I should say 1 to 2 years in our eyes, but that is still TBD.

Matthew Gourmand

I would also say that just the quality of this portfolio and the ability of this management team to push rate and continue to find value gives us a great deal of conviction that even upon "stabilization", there's still meaningful growth to come from this portfolio for many years to come.

Operator

Your next question comes from the line of Juan Sanabria with BMO Capital Markets.

Juan Sanabria

Just hoping to piggyback on Dave's question with regards to the U.K. SHOP transitions of those 30 assets. If you could spend a little time talking about the age or vintage of the asset mix, generally, how you view kind of triple-net versus SHOP type in the U.K. given the divergence in or spectrum of the overseas.

Matthew Gourmand

You're breaking up a little bit at the end there, but we'll give it a go. And if we miss some of your questions, please follow up. So yes, in terms of the vintage of the assets that we converted, it's kind of consistent with most of our portfolio. It's what we would term kind of middle market assets. They're predominantly purpose-built assets with en suites. They are fit for purpose for the longer term. There's quite frankly, a lack of real estate in the market over there to meet these needs. So we feel very high conviction that the quality of this real estate will be there for the long term.

And then in terms of how we look at the quality of the real estate as part of the context of whether we do RIDEA or triple-net, it doesn't -- it's not really a primary determining factor. Ultimately, a lot of the time, it's determined by what the operator/manager wants. So if they believe there's meaningful upside, there's a far greater appetite amongst operators in the U.K. to take triple-net leases than there are in the U.S. seniors housing space. So from that standpoint, it's not surprising when a number of operators want to take that side of things.

Obviously, all of the assets that we look to buy, be they in a RIDEA format or in a triple-net format have to be fit for purpose longer term. And that's something that we spend an awful lot of time looking at making sure that they have the requisite number of en suites or wet rooms that they were primarily built as purpose-built and that whether they are capable of effectively providing the clinical needs and the quality of home care that residents are going to be looking for, for the foreseeable future. So it's a major, major consideration. There's no point buying assets that ultimately in 5 to 10 years are just not going to be fit for purpose.

Juan Sanabria

Just as a follow-up, hoping you could talk a little bit about the pipeline going forward and the mix across the different buckets and how that's maybe changing prospectively, if at all? And if you've seen any pickup implications for maybe changes you're seeing in HUD or lack thereof with regards to maybe tilting back towards U.S. skilled nursing that I think you said maybe had the highest initial yields, any color would be helpful.

Vikas Gupta

Yes. This is Vikas. I'll jump in on this one. So as I said in my prepared remarks, our pipeline is strong, and we're looking at all 3 asset classes: skilled nursing, senior housing, and U.K. It is competitive, but I will say there's a lot of volume. Hence, we were able to do the deal volume we've done and hence, our pipeline continues to be strong. As for where we continue to see opportunities, I would say it's leaning a little bit more towards senior housing, RIDEA, and care homes, both U.K. care homes, both in triple-net and RIDEA. When it comes to skilled nursing, it is very competitive. But with that said, we do have skilled nursing deals in our pipeline, and we continue to keep pursuing them.

Matthew Gourmand

And then the only thing I'd follow up on is just with your comment on HUD. We have heard feedback from some very sophisticated players within the space that, that is possibly changing the ability to borrow and the like. We haven't seen that as of yet. But I wouldn't discount what other people are seeing. We just haven't seen it ourselves.

Operator

Your next question comes from the line of Michael Carroll with RBC Capital Markets.

Michael Carroll

Matthew, I wanted to touch on where OHI is on refining its portfolio. I know you already discussed throughout this call about opportunities to do some operator transitions kind of similar to the PACS deal. But what about opportunistic asset sales? Is there additional asset sales that you're kind of looking at within the portfolio that the company is looking at pursuing?

Matthew Gourmand

It's a great question. Thanks for that. We have spent a lot of time -- our operations team has spent a lot of time looking at that portfolio. And I think that as we sit here today, there is no sense of urgency in terms of large elements of the portfolio that do not seem fit for purpose longer term. So obviously, we've gone through a fairly decent culling process from about 2016 onwards. And a certain amount of that was generated by challenged operators, but sometimes challenged operators is a result of challenged facilities, right? So inherently, there probably was a culling of some underperforming facilities as a result of that.

That having been said, we do challenge the team constantly to be making sure that we're revisiting that. So I don't think that any sales that we would make in the next few years come from a position of necessity. But I do think that there are probably selective opportunistic sales that could happen at the right price. So I think it's going to be more determined by price than necessity.

Michael Carroll

Okay. And is there -- I know that you have sold a couple of SNF portfolios recently at pretty low cap rates. I mean, is there opportunistic sales that you could pursue that has those good price, low cap rate type transactions? Or is that something that just kind of comes up randomly when something like that arises?

Matthew Gourmand

Everything has a price. If anyone wishes to pay very large amounts of money for our assets, please call, Vikas.

Operator

Your next question comes from the line of Michael Stroyeck with Green Street.

Michael Stroyeck

Maybe going back to the U.K. mortgage deal. Can you just talk about how that portfolio compares to the company's in-place U.K. assets in terms of price point, payer mix, location or anything else that could give us a sense of the quality of the assets?

Vikas Gupta

Yes. This is Vikas. I would start by saying it is a higher quality than our average portfolio right now. Hence, the price per bed was a bit higher. But with that, we see a lot of opportunity. As I said earlier, we see some upside in this portfolio. We think our new operator foundation could see some of that opportunity through rate increases, and that will be driven by acuity. Overall, it is a good portfolio. It has a high private pay mix. And so overall, I think it will just -- it will elevate the caliber of our U.K. portfolio.

Michael Stroyeck

Got it. That's helpful. And maybe one on occupancy. It's been essentially flat over the past year or so. I guess how much of that is just because of investment activity versus more organic occupancy? I guess, said differently, what has occupancy growth been like over the past year or so on more of a same-store basis?

Megan Krull

A lot of what you are seeing is those ins and outs of what's going on transactionally. So from a same-store basis, we are seeing increased growth, and we are continuing to see increased growth into this next quarter.

Operator

Your next question comes from the line of Farrell Granath with Bank of America.

Andrew Reale

This is Andrew Reale on with Farrell. I guess, first, with Genesis now resolved and the Runwood investment initially structured as a loan, how should we think about the role of lending going forward? And how you see the size of that loan book trending over time?

Matthew Gourmand

Yes. So loans for the purpose of loans is kind of like running on a treadmill, right? You exert a huge amount of energy and go nowhere over time. So it's just not something that we'll be looking to do. The loan structure in the U.K. is effectively a conduit to access the real estate. So I don't consider that to be a loan per se. I think that we would be extremely selective on doing loans for the sake of loans.

I think you've either got to have access to real estate or some participation in economic upside. But we're not a bank, and we don't want to trade at the kind of multiples that warrant. So we will continue to look to own the real estate wherever possible. And if we are looking to do loans, there better be something attached to it other than just putting money out the door.

Andrew Reale

Okay. And apologies if I missed this earlier, but just curious if you could maybe discuss just cap rates broadly you're seeing across the asset classes and maybe how they vary in the U.S. versus U.K. today?

Vikas Gupta

Yes. As I mentioned, it's a competitive environment. I mean, look, cap rates haven't changed a lot historically, but there's a lot of players out there. So senior housing is very competitive in the U.S. You have all the other REITs playing in there, private equity playing in there. Care homes, we also have REITs playing there as well now, made Runwood with a very competitive process. You can see the cap rate we're entering at this deal, which is a bit more aggressive than we've done historically. So in general, I would just say cap rates are more aggressive than what we've seen historically. But we are structuring things in ways that we can, over time, go back and get our normal returns of 10% plus.

Operator

We have reached the end of the Q&A session. I will now turn the call back to Matthew Gourmand, CEO, for closing remarks.

Matthew Gourmand

Thanks, everyone, for joining us today. If you have any questions, reach out to the group, and I would just like to take this opportunity to thank the team as well. The results that you're seeing are a result of huge amounts of hard work on the part of all the employees of the company. So I want to acknowledge that and thank them. Thanks, everyone. Bye.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.