Welltower (NYSE:WELL) management used its fourth-quarter 2025 earnings call to recap what it repeatedly described as a “transformational” year, highlighting strong same-store performance in its Senior Housing Operating Portfolio (SHOP), a major capital rotation funded by outpatient medical dispositions, and growing emphasis on operating execution and technology through the Welltower Business System (WBS).
Fourth-quarter results capped a year of strong SHOP growth
CEO Shankh (first name not provided in the transcript) said the company delivered its “strongest year” to date, including a 13th consecutive quarter of SHOP same-store net operating income (NOI) growth above 20%. In the fourth quarter, the SHOP portfolio produced same-store NOI growth of 20.4%, while total portfolio same-store NOI grew 15%.
On a GAAP and FFO basis, CFO Tim (first name not provided) reported fourth-quarter net income attributable to common stockholders of $0.14 per diluted share and normalized funds from operations (FFO) of $1.45 per diluted share, representing 28.3% year-over-year growth.
Capital rotation and acquisition activity reshaped the portfolio
Executives emphasized that 2025’s capital allocation strategy was designed to increase the company’s exposure to higher-growth senior housing. Nikhil (first name not provided) said the company deployed roughly $11 billion of net investment capital in 2025 and increased SHOP concentration by about 12 percentage points to around 70%.
Nikhil said Welltower closed 90 transactions during the year, acquiring more than 1,000 properties, including over 175 that are under construction or recently delivered. He noted those newer assets are not expected to contribute meaningfully to near-term results but are expected to support growth over time. He also said the average age of Welltower’s SHOP portfolio is now 16 years, compared with 19 years at the end of 2021.
Funding for the repositioning included the sale of an outpatient medical portfolio to Kayne Anderson. Management reiterated the previously announced $7.2 billion sale is “on track and ahead of schedule,” with about $5.8 billion closed to date and remaining tranches expected to close in the first half of the year as tenant estoppels and ground lessor consents are finalized. Nikhil said the sale generated a $1.9 billion gain on sale.
Integra skilled nursing dispositions and the company’s SNF framework
Management also highlighted a $1.3 billion sale of skilled nursing assets tied to the Integra Health portfolio (referenced as the former ProMedica/QCP/HCR ManorCare assets). Shankh said the portfolio saw a $500 million rebound in cash flow over 3.5 years and is believed to be close to stabilization. Both Shankh and Nikhil cited an unlevered internal rate of return (IRR) of approximately 25% and a 3.1x unlevered money multiple over seven years for the sale outcome they discussed.
Asked whether skilled nursing could serve as a recurring source of funds, Shankh described the company’s skilled nursing approach as a “structured credit investment,” with a strategy of acquiring assets with a turnaround opportunity, bringing in regional operators, stabilizing performance, and then exiting. He added that once a business plan is executed, Welltower believes skilled nursing operators should be end owners, supported by HUD financing.
Operations, WBS, and the “Tech Squad”
Executives repeatedly framed Welltower as “an operating company in a real estate wrapper,” with WBS positioned as a proprietary operating platform intended to improve resident experience, site-level employee experience, and efficiency. John (first name not provided) said the company is focused on “people, processes, data, and technology,” and described efforts to reduce administrative burdens on frontline staff.
Management also discussed staffing and systems investments, citing hiring activity for the company’s “Tech Squad.” John pointed to the impact of Jeff Stott, the new chief technology officer, and Bron McCall, a senior technology hire, both previously associated with Extra Space Storage. Shankh told analysts that Welltower’s data science platform is “mature” but still has work ahead, while describing the company’s operational technology capabilities as “mediocre minus.”
On monetization, Shankh said Welltower would not sell its operating software externally to potential competitors, even as it looks to bring third-party capital into strategies that sit alongside its balance sheet.
2026 outlook: higher earnings expectations, occupancy gains, and margin opportunity
Tim introduced full-year 2026 guidance for net income attributable to common stockholders of $3.11 to $3.27 per diluted share and normalized FFO of $6.09 to $6.25 per diluted share, with a midpoint of $6.17. He said the midpoint implies a $0.88 per share increase versus 2025, including a $0.58 increase from higher year-over-year SHOP NOI, $0.30 from investment and financing activity, and $0.02 from higher triple net income, offset by $0.02 of higher net G&A.
For same-store NOI, Tim guided to total portfolio growth of 11.25% to 15.75%, including SHOP growth of 15% to 21%. The SHOP assumptions at the midpoint included:
- Revenue growth of 9%, comprised of RevPOR growth of 4.8% and 350 basis points of year-over-year occupancy growth
- Expense growth of 5.5%, equating to ExPOR growth of just under 1.5%
Tim said the company’s outlook does not include any investment activity beyond $5.7 billion of acquisitions that have been closed or publicly announced. Nikhil added that Welltower had already closed on or was under contract to close $5.7 billion of acquisitions early in 2026, including the previously announced $3.2 billion Amica Senior Lifestyles transaction and $2.5 billion of additional activity across more than 30 transactions, with blended occupancy in the low 80% range and most sourced off-market.
Management also discussed internal incentive changes and talent retention, with Shankh saying the company expanded its Executive Continuity and Alignment Program to seven additional leaders and increased the performance-based portion of payouts to 70% from 50% previously announced. He also described the “Welltower grant” program for frontline employees as being expanded beyond the original 10 communities, with exploration of an international expansion.
About Welltower (NYSE:WELL)
Welltower Inc (NYSE: WELL) is a real estate investment trust (REIT) that acquires and manages real estate serving the health care industry. The company specializes in healthcare infrastructure, owning and operating a diversified portfolio of senior housing, post-acute and long-term care communities, and outpatient medical properties. Welltower’s assets are designed to support the delivery of health care services through a combination of leased properties, joint ventures, and other capital arrangements with health care operators and providers.
The company’s property types include assisted living, memory care, independent living and skilled nursing facilities, as well as medical office buildings and other outpatient-care real estate such as ambulatory surgery centers and specialty clinics.
