Sila Realty Trust (NYSE:SILA) management used its fourth-quarter 2025 earnings call to highlight portfolio growth, improved tenant credit quality, and a conservative balance sheet position it says leaves room to deploy additional capital in 2026. Executives also discussed a slate of planned property dispositions, ongoing redevelopment and expansion investments, and market pricing for healthcare real estate assets similar to Sila’s portfolio.
First full calendar year as a public company
Chief Executive Officer Michael A. Seton described 2025 as Sila’s first full calendar year as a publicly traded company and said the company “faithfully executed” its strategy to grow in a “skillful and thoughtful manner.” Seton noted Sila was added to several equity indices during the year, including the RMZ and the Russell 2000, and said the shareholder base has shifted over time from entirely retail to what he described on the call as roughly 70% institutional ownership.
Acquisitions, expansion investments, and redevelopment activity
Seton said Sila acquired six healthcare facilities during 2025 for an aggregate purchase price of approximately $150 million, representing 241,000 square feet. He said the acquisitions fit what the company calls the “Sila mold,” including modern construction, high utilization, favorable demographics, and quality tenant sponsorship.
After year-end, the company closed on a purpose-built inpatient rehabilitation facility in Oklahoma City for $43.1 million. Seton said the facility was originally constructed in 2022 and recently expanded its licensed bed count from 40 to 58 beds. He cited factors including a long-term lease with contractual escalators, “strong EBITDARM coverage,” experienced sponsorship, and limited competition.
Within the existing portfolio, Seton said Sila completed more than $7 million of redevelopment opportunities over the past year at what he called “compelling risk-adjusted returns.” He added that Sila had already committed additional capital at its Dover Healthcare facility and intended to execute a similar investment at its Overland Park Healthcare facility, both inpatient rehabilitation facilities leased to PAM Health. He said such expansions often offer more favorable returns than recent acquisitions, “frequently yielding 150–200 basis points higher than going-in capitalization rates.”
Dispositions, leasing results, and property updates
Management outlined several planned dispositions as part of ongoing portfolio optimization. Seton said Sila executed purchase and sale agreements on three properties near year-end 2025: Henderson, Las Vegas Two, and Saginaw Healthcare facilities. After year-end, Sila closed on the sale of the Saginaw Healthcare facility for gross proceeds of $14.5 million, while Henderson and Las Vegas Two were estimated to close in the first quarter of 2026.
Seton also said the company executed a purchase and sale agreement to sell its Alexandria healthcare facility after it became vacant in December 2025 following the departure of its ASE tenant. Subject to due diligence, Sila expected that sale to close around the end of the first quarter or beginning of the second quarter of 2026.
On leasing, Seton said approximately 4.8% of total gross leasable area was scheduled to expire in 2025. The leasing team retained 90% of scheduled expiring tenancy on a square-footage basis, while the 10% of tenants who did not renew represented 0.5% of annualized base rent (ABR). He said the Alexandria facility accounted for 60% of that non-renewal group.
During the Q&A, management provided additional detail on Alexandria rent collections. Seton said scheduled rent was about $40,000 per month; the lease expired in August and the tenant paid holdover rent through November at 125% of scheduled rent. He said total rent paid in the fourth quarter was $120,000 and that the holdover payments effectively resulted in “full rent for the year.”
Seton also said lease renewals and proactive early extensions increased weighted average remaining lease term to 10 years at year-end 2025 from 9.7 years at the end of the third quarter. For 2026 expirations, he said the company had completed renewals for 34.8% of the 4.1% of total gross leasable area expiring that year. He added that one single-tenant property is expected to convert into a multi-tenant property, with legacy tenancy renewing about 60% of the space and the remaining 40%—about 0.3% of company ABR—being marketed for re-leasing.
Seton also updated investors on the Stoughton Healthcare facility, saying demolition had been completed and debris removal was underway, with work expected to be finished by the end of the first quarter of 2026. He said razing the structures reduced carrying costs to approximately $35,000 per month from as much as $120,000 per month during the middle of the prior year.
Tenant credit quality and portfolio coverage
Management emphasized credit quality improvements. Seton said investment-grade rated tenant guarantor and affiliate exposure increased 2.3 percentage points year over year to 40.6% in 2025. As an example, he said Washington Regional Medical Center—described as an investment-grade regional hospital system—executed a lease and took occupancy of the Fayetteville healthcare facility from Community Health Systems in the fourth quarter, reducing Community Health Systems’ tenant concentration from third largest to seventh largest at year-end.
Seton added that after year-end, Community Health Systems completed the divestiture of three Pennsylvania hospitals, including Sila’s Wilkes-Barre healthcare facility, to Tanner Health Foundation effective Feb. 1, 2026, which he said would further reduce exposure going forward. He also noted that the tenant at Sila’s Savannah healthcare facility was sold through the bankruptcy process to Select Medical, an existing tenant, which moved Select to the company’s fourth largest tenant.
On sponsorship, Seton said Cencora announced late in the fourth quarter that it entered into a definitive agreement to acquire the majority of the outstanding equity interest it does not already own in OneOncology, which Seton said would place Cencora under common control at Sila’s seven former GenesisCare master leased properties.
Financial results and balance sheet position
Chief Financial Officer Kay C. Neely reported full-year 2025 cash NOI of $169.9 million, compared to $168.6 million in 2024, a 0.8% increase. She said the increase was driven largely by acquisitions and 0.9% same-store cash NOI growth, partially offset by dispositions and the impact of the Stoughton vacancy. Neely also noted that year-over-year comparisons were affected by more than $6 million in one-time lease termination and severance fees collected in 2024 versus less than $300,000 of termination fees in 2025. Excluding those one-time fees, she said cash NOI and same-store cash NOI growth would have been 4.4% and 1.1%, respectively.
Neely reported FFO per share of $2.16 for the full year, up 3.6% from the prior year, and AFFO per share of $2.18, down 5.8%. She attributed the FFO per-share increase to items including higher straight-line rent tied largely to PAM Health lease amendments in December 2024; prior-year write-offs of above-market rent related to the GenesisCare bankruptcy in 2024; higher interest income from two mezzanine loans; lower G&A and other costs in 2025 following one-time separation pay and higher personnel costs in 2024; and $3 million of one-time NYSE listing fees. She said the FFO increase was partially offset by higher interest expense, largely related to new swaps entered into at the end of 2024 as prior swap maturities expired. The AFFO per-share decline, she said, was driven by higher interest expense, partially offset by the cash NOI items, lower G&A costs, and higher interest income from fully funded mezzanine loans.
Neely said 75.6% of portfolio ABR reported financial results at either the tenant or guarantor level. She reported a portfolio-wide EBITDARM rent coverage ratio of 5.9x in 2025, up from 5.3x in 2024. Excluding the Saginaw tenant—described as having an outsized coverage ratio and whose property was sold in late January 2026—she said coverage would have been 5.7x for 2025, still above 2024 levels.
On leverage, Neely reported net debt to EBITDAre of 3.9x at year-end, below the company’s targeted range of 4.5x to 5.5x. She said that equated to over $200 million of debt capital that could be deployed to reach the midpoint of the targeted leverage range. Total liquidity exceeded $480 million at year-end. As of Dec. 31, 2025, Sila had $676 million outstanding under unsecured credit facilities at a weighted average interest rate of 4.7%.
In the Q&A, Seton said Sila could invest roughly $225 million to reach the midpoint of its leverage target and as much as $375 million to reach the high end. He said management remained discerning on acquisitions due to competition and noted the company also sees opportunities to deploy capital into expansion investments within its existing portfolio. Seton said acquisition volumes in 2026 could be similar to 2025, with the cadence influenced by market conditions and the company’s focus on portfolio investment opportunities.
Management also discussed market pricing for healthcare assets similar to Sila’s holdings. Seton said inpatient rehabilitation assets for performing properties with longer-term leases and strong sponsors were generally in the high-6% to mid-7% cap rate range, while medical office and outpatient/ASC-type assets could trade tighter, around the low-6% to mid-6% range, and surgical hospitals around the high-6% to about 7% depending on credit and lease terms.
About Sila Realty Trust (NYSE:SILA)
Sila Realty Trust, Inc, headquartered in Tampa, Florida, is a net lease real estate investment trust with a strategic focus on investing in the large, growing, and resilient healthcare sector. The Company invests in high quality healthcare facilities along the continuum of care, which, we believe, generate predictable, durable, and growing income streams. Our portfolio comprises high quality tenants in geographically diverse facilities, which are positioned to capitalize on the dynamic delivery of healthcare to patients.
