EXCELLENCE. SUSTAINED. INVESTOR PRESENTATION MAY 2017

Transcription

1 EXCELLENCE. SUSTAINED. INVESTOR PRESENTATION MAY 2017

2 FORWARD-LOOKING STATEMENTS This presentation contains 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. These forward-looking statements include, among others, statements of expectations, beliefs, future plans and strategies, anticipated results from operations and developments and other matters that are not historical facts. The forward-looking statements are based on management s beliefs as well as on a number of assumptions concerning future events. Readers of these materials are cautioned not to put undue reliance on these forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties and other factors that could cause actual events or results to differ materially from those expressed or implied by the forward-looking statements. The most important factors that could prevent the Company from achieving its stated goals include, but are not limited to: (a) the ability and willingness of the Company s tenants, operators, borrowers, managers and other third parties to satisfy their obligations under their respective contractual arrangements with the Company, including, in some cases, their obligations to indemnify, defend and hold the Company harmless from and against various claims, litigation and liabilities; (b) the ability of the Company s tenants, operators, borrowers and managers to maintain the financial strength and liquidity necessary to satisfy their respective obligations and liabilities to third parties, including without limitation obligations under their existing credit facilities and other indebtedness; (c) the Company s success in implementing its business strategy and the Company's ability to identify, underwrite, finance, consummate and integrate diversifying acquisitions and investments, including investments in different asset types and outside the United States; (d) macroeconomic conditions such as a disruption of or a lack of access to the capital markets, changes in the debt rating on U.S. government securities, default or delay in payment by the United States of its obligations, and changes in the federal or state budgets resulting in the reduction or nonpayment of Medicare or Medicaid reimbursement rates; (e) the nature and extent of future competition, including new construction in the markets in which the Company s seniors housing communities and medical office buildings are located; (f) the extent of future or pending healthcare reform and regulation, including cost containment measures and changes in reimbursement policies, procedures and rates; (g) increases in the Company s borrowing costs as a result of changes in interest rates and other factors; (h) the ability of the Company s tenants, operators and managers, as applicable, to comply with laws, rules and regulations in the operation of the Company s properties, to deliver high-quality services, to attract and retain qualified personnel and to attract residents and patients; (i) the Company s ability and willingness to maintain its qualification as a REIT in light of economic, market, legal, tax and other considerations; (j) the ability and willingness of the Company s tenants to renew their leases with the Company upon expiration of the leases, the Company s ability to reposition its properties on the same or better terms in the event of nonrenewal or in the event the Company exercises its right to replace an existing tenant or manager, and obligations, including indemnification obligations, the Company may incur in connection with the replacement of an existing tenant or manager; (k) consolidation activity in the seniors housing and healthcare industries resulting in a change of control of, or a competitor s investment in, one or more of the Company s tenants, operators, borrowers or managers or significant changes in the senior management of the Company s tenants, operators, borrowers or managers; and (l) the other factors set forth in the Company s periodic filings with the Securities and Exchange Commission. 1

3 TABLE OF CONTENTS Ventas Introduction (4-12) Healthcare Real Estate Market (13-22) Operational Excellence in Seniors Housing (23-30) The Hospital Growth Opportunity (31-36) Our Medical Office Building Platform (37-40) Our Life Science Platform (41-46) Post-Acute Portfolio (47-49) Closing (50) Appendix Definitions and SEC Reg. G Compliance (52-60) 2

4 VENTAS INTRODUCTION EXCELLENCE. SUSTAINED.

5 VENTAS INVESTMENT THESIS EXCELLENCE. SUSTAINED. We are the premier provider of capital to leading senior living and healthcare operators and research institutions Ventas is positioned at the intersection of two large and dynamic markets: healthcare and real estate Each represents nearly 20% of U.S. GDP Demand tailwind of large growing senior population + longevity megatrend $1T, fragmented real estate market ripe for investment Excellence Demonstrated: track record of consistent growth and income through cycles for almost two decades We will sustain excellence with superior People, Properties and Platforms Diversified business model and financial strength High-quality portfolio partnered with leading operators across asset classes Extraordinary external growth opportunities Attractive dividend yield with room to grow Outstanding cohesive team 4

6 LONG-TERM SUSTAINABLE GROWTH AND INCOME WITH FINANCIAL STRENGTH Annual FFO / Sh Growth since % Q Cash Flow from Operations Growth 2 21% Annual Cash Dividend / Sh Growth since % TSR CAGR since Credit Rating 12/31/ SNF Exit 4 25% BBB+ ~$5B At ~7% Cap Rate Leading S&P 500 Company 3 $35B Enterprise Value Best-In-Class Fixed Charge Coverage 2 Diversified Portfolio 2 4.6x ~1,300 Assets 1. Source: Company financials. FFO growth based on arithmetic average of annual growth rates from the period. FFO average utilizes 2015 and 2016 Comparable normalized FFO / share growth rates of 9% per the Company s Q4 and full year 2015 earnings release and 5% per the Company s Q4 and full year 2016 press release, respectively. Dividend growth represents annual cash dividends paid per share from the period, excluding special dividends or share distributions to shareholders. 2. Data per Q press release, supplemental and earnings conference call dated 04/28/ Total shareholder return represents compound annual growth rate through 12/31/2016. Enterprise value as reported in the Q supplemental. 4. Includes the Company s SNF spin-off in 2015 and the anticipated sale of its Kindred SNF portfolio for $700M at a 7.1% cash yield in

7 SUPERIOR LONG-TERM RETURNS TO SHAREHOLDERS FROM HIGH- QUALITY DIVERSIFIED PORTFOLIO WITH LEADING OPERATORS 16% TSR Performance Multiple Periods 1 8% 11% 13% 13% 9% 10% 5% 7% 1-Year 3-Year 10-Year VTR RMZ S&P Year TSR Performance (2016) VTR: 16% S&P: 11% RMZ: 8% December January February March April May June July August September October November December Source: Bloomberg. 1. For the periods ending 12/31/

8 NORMALIZED FFO ($) / SHARE Growth (INDEXED TO 2001) OUR FORESIGHT AND INNOVATION CHANGED THE WAY REAL ESTATE INVESTORS THINK ABOUT HEALTHCARE; CHANGING THE WAY LEADING PROVIDERS / OPERATORS THINK ABOUT REAL ESTATE Healthcare Real Estate Foresight Execute Early Grow Platforms with Winning Operators of 10 credit upgrades during financial crisis 4.0 RIDEA RMZ Campaign Source: Company financials. Based on annual growth rates from the period and 2016 periods utilize Comparable normalized FFO / share growth rates. 7

9 DELIVERING VALUE TO SHAREHOLDERS AND MEETING CUSTOMER NEEDS MOBs Largest national MOB business 95% on-campus / affiliated with leading health systems ~92% occupancy Stable, growing cash flows >7x investment growth ~5 years Significant multiple expansion since investment creates value Senior Living ~$3B initial investment w/ consistent cash flow growth outperformance High-quality real estate in top coastal MSAs with high wealth, home values and barriers to entry Top 10 national senior care provider Nearly doubled investment in ~5 years to fuel Atria growth Trophy development projects underway Life Science University-based, new life science and innovation centers with long leases and strong credit Adjacent business line that diversifies cash flows and is a new channel for growth Attractive yield, superior risk adjusted return Exclusive capital partner to leading developer Funding significant projects with life science and innovation centers associated with top research institutions >$350M completed or committed follow-on investments, including a high-quality campus in Providence, RI associated with Brown University and the State of Rhode Island Acute Care $2B investment Scalable platform, $3B revenue provider in 6 states Superior risk-adjusted return Key not-for-profit relationships High-quality facilities with significant market share 8

10 CONSISTENT, SUPERIOR GROWTH & INCOME VTR 11% Norm. FFO / Share Growth 1 HCP HCN 5% 4% VTR 8% Cash Dividend / Share Growth 2 HCN HCP 3% 2% Company financials. Based on arithmetic average of annual growth rates from the period. VTR average utilizes 2015 and 2016 Comparable normalized FFO / share growth rates. HCP results utilize 2016 comparable FFO as adjusted per share growth rate. HCP 2001 and 2002 reported results adjusted for 2:1 stock split. 2. Represents annual cash dividends paid per share from the period, excluding special dividends or share distributions to shareholders. 9

11 INDUSTRY LEADING ENTERPRISE Advantaged Portfolio 1 Medical Office 1% 6% 19% IRFs & LTACs International Hospitals Loans U.S. Acute 7% 1% Care Hospitals 6% 5% Skilled Nursing Life Science $2B NOI 25% Seniors Housing - Operating 30% Seniors Housing - NNN Differentiated Superior Metrics 2 VTR HCN 2016 Norm. FFO / Sh Growth 5% 4% 5% 2016 Dividend Growth3 6% 1% n/a 7 SNF % NOI 1,5,6 1% ~13% 0% SHOP % NOI 1,5,6 30% ~42% ~20% MOB & Life Science % NOI1,5,6 ~25% ~18% ~44% Top Tenant Concentration 1,5,6 9% ~8% ~27% Fixed Charge Coverage 4.6x 3.2x 3.6x Net Debt + Preferred / EBITDA 5.9x 5.6x HCP Low-to-Mid 6x 1-Year TSR (2016) 16% 3% (9%) Data per Q press release, supplemental and earnings conference call dated 04/28/2017. Pro forma for the expected $700M sale of 36 Kindred SNFs to Kindred in 2017 plus additional dispositions for a total $900M of 2017 dispositions including the aforementioned SNF sale. Disposition figures as discussed in the Company s 2017 guidance as announced on 04/28/ Per company Q earnings press releases and financial disclosures, unless otherwise noted. 3. Represents Q quarterly dividend per share growth rates. 4. HCP dividend growth not comparable due to the QCP spin. 5. HCN represents Q1 annualized NOI pro forma for anticipated sale of $400M of Genesis assets in Not pro forma for other announced dispositions for which proceeds and yields were not provided. 6. HCP represents Q1 annualized NOI, inclusive of loan income and HCP s share of unconsolidated JV interest, pro forma for announced 2017 disposition transactions Represents HCN post-acute % of NOI; HCN post-acute portfolio is mostly SNFs. 8. Brookdale concentration as disclosed in HCP s Q supplemental; represents pro forma for Brookdale transactions.

12 CONSISTENT OUTSTANDING EXECUTION 1 3.9% Q Same-Store NOI Growth 7.1% Premium Value SNF Disposition to Facilitate Kindred SNF Exit On Track 6% Q Dividend Growth 2 Improved Liquidity through $3B Upsized and Extended Revolving Credit Facility 21% Q Cash Flow From Operations Growth $3B Revenues Leading Acute Care Platform in 6 States >$350M Life Science and Innovation Center Follow-On Acquisitions and Development Commitments Productive and cohesive team 1. Data per Q press release, supplemental and earnings conference call dated 04/28/ Represents dividend per share increase from Q to Q1 2017; increased annual dividend rate announced and effective in Q

13 2017 GUIDANCE Guidance Highlights Continued same-store NOI growth Strategic recycling of capital and disposition of nearly all of skilled nursing portfolio at >$650M gain Invest in future growth through new Wexford ground up developments Drive an even stronger financial profile and liquidity Normalized FFO / Share $4.12-$4.18 Key Financial Metrics + Assumptions Same-Store Growth (Cash) Total Company Same-Store Growth (GAAP) Total New 2017 Investments Total 2017 Asset Sales & Loan Repayments 2017 (Re)development Funding Weighted Average Diluted Shares Total Company: 1.5%-2.5% Segments: SHOP 0%-2%; NNN 2.5%-3.5%; MOB 1%-2% Typically ~100bps lower than cash driven by straight-line rent ~$1B ~$0.9B ~$350M ~358M 1. Data per Q press release, supplemental and earnings conference call dated 04/28/

14 HEALTHCARE REAL ESTATE MARKET EXCELLENCE. SUSTAINED.

15 ATTRACTIVE AND DYNAMIC OPPORTUNITIES VTR AT THE INTERSECTION OF HEALTHCARE AND REAL ESTATE >$17T U.S. GDP Healthcare 20% by VTR ~20% Real Estate 2 Large and growing aging population increases demand for healthcare and senior living products Senior population has immense spending power and wealth Healthcare spending projected to grow 5.8% annually ( ) 1 Senior housing and healthcare real estate market is large, fragmented and ripe for consolidation ($1T real estate market) Healthcare real estate under-owned by REITs <15% well below other REIT sectors Consolidation opportunities at the early stages of asset migration to REITs (most efficient owners) 1. Source: CMS. 2. Source: NAIOP Economic Impacts of Commercial Real Estate, 2015 Edition; represents total economic contribution to GDP (includes multiplier effect). 14

16 DEMOGRAPHICS & LONGEVITY FUELING DEMAND Growing Population of Healthcare Consumers With Immense Wealth and Spending Power And Increasing Care Needs with Age 7x Faster Growth in 75+ Population 1 10,000 Boomers Turning Medicare Eligible Daily 2 34M 75+ By 2030 (+14M) 1 >$640K Average 75+ Net Worth 3 73% Of U.S. Healthcare Spending from 50+ Population 4 $12T Of Wealth Transfer to Boomers over Next Years 4 5x More Healthcare Spending from Seniors 5 2.5x More Physician Office Visits from Seniors 6 40% Of 85+ Cohort Need Help with 3+ Activities of Daily Living 4 1. Source: US Census Bureau, Population Division. 2. Source: Pew Research Center. 3. Federal Reserve Survey of Consumer Finances. 4. Bank of America Merrill Lynch, Thematic Investing (May 2016). 5. ISI Real Estate Research; Bureau of Labor Statistics. 6. Marcus and Millichap, CMS. 15

17 A $1T DOMESTIC REAL ESTATE MARKET ASSETS SHOULD FLOW TO MOST EFFICIENT OWNERS Outpatient Facilities/ MOBs Life Science / Biotech Facilities Domestic market is large and growing 5% 10% Post-Acute Facilities Early stages of securitized public real estate 39% 15% Private Pay Seniors Housing Dynamic policy environment Care delivery increasingly interconnected 31% Hospitals Consolidating and fragmented market with significant capital needs 16

18 SIGNIFICANT RUNWAY FOR GROWTH EARLY INNINGS OF HEALTHCARE REIT OWNERSHIP PERCENTAGE OF REAL ESTATE OWNED BY REITS Successful Model for Separating Real Estate from Operating Business 40%-50% 50%-55% 20%-25% 12%-15% Healthcare Multifamily Housing (Top 50) 1 Malls Hotels (Top 25) 2 1. Based on number of units owned by top 50 multifamily housing owners. 2. Based on number of units owned by top 25 hotel owners. 17

19 CONSOLIDATION IS ON THE HORIZON WINNING OPERATORS WILL EMERGE MARKET SHARE OF TOP 10 OPERATORS Highly fragmented markets 90% 90% 80% Other Operators Benefits of scale and integration Dynamic policy environment Accelerating consolidation Winners will emerge 10% 10% Hospitals 1 Post-Acute Care 2 20% Seniors Housing Top 10 Operators Consolidators will need capital partners Source: MedPAC, Provider, LTPAC Health IT, ASHA, NIC, Becker's Hospital Review, AHA, Company estimates. 1. Includes all community hospitals (nonfederal, short-term general and special hospitals). 2. Includes SNF and HH operators. 18

20 HEALTHCARE DELIVERY IS CONVERGING REQUIRING SOLUTIONS ACROSS SITES OF CARE AND GEOGRAPHIES Community- Based Care Hospitals Leading operators consolidating + Care delivery increasingly interconnected + Dynamic policy environment = Seniors Housing Life Science Post- Acute Care Need for broad and deep CAPITAL AND REAL ESTATE SOLUTIONS 19

21 INVESTING ACROSS THE CAPITAL STRUCTURE IN DIVERSIFIED ASSET TYPES Senior Housing MOBs Acute Care Life Science Post-Acute NNN Lease Debt Investments Operating Real Estate Operator Equity Investment 20

22 THE VENTAS ADVANTAGE ENSURING EXCELLENCE. SUSTAINED. PEOPLE OUR PEOPLE OUR PROCESSES OUR CULTURE ADVANTAGED REAL ESTATE ASSETS IN ATTRACTIVE MARKETS PROPERTIES ADVANTAGE PLATFORMS LEADING OPERATORS ACROSS THE SITES OF CARE 21

23 FUTURE GROWTH PROSPECTS ARE BRIGHT DRIVE OPERATIONAL EXCELLENCE WITH LEADING OPERATORS BUILD ON ADVANTAGED PLATFORMS WITHIN ASSET CLASSES CAPITALIZE ON HEALTHCARE CONVERGENCE EXPLORE NEW MARKETS MOBs and SHOP E.g., Hospitals, Life Science and Redevelopment Real estate solutions across sites of care New asset classes and geographies Opportunity to Change the Way Leading Healthcare Providers Think about Capital Sources 22

24 OPERATIONAL EXCELLENCE IN SENIORS HOUSING EXCELLENCE. EXEMPLIFIED.

25 VENTAS SENIORS HOUSING PORTFOLIO 1 International Hospitals U.S. Acute Care Hospitals Skilled Nursing Life Science Loans 6% 5% 1% IRFs & LTACs 7% 1% 6% $2B NOI 30% Seniors Housing - Operating Outstanding SHOP assets in advantaged markets + high-quality NNN leases ~50% SHOP / 50% NNN seniors housing portfolio Tremendous industry tailwinds Growth in the seniors population 19% Benefits of communal living Medical Office 25% Seniors Housing - NNN 0%-2% 2017(E) same-store NOI growth 1. Data per Q press release, supplemental and earnings conference call dated 04/28/2017. Pro forma for the expected $700M sale of 36 Kindred SNFs to Kindred in 2017 plus additional dispositions for a total $900M of 2017 dispositions including the aforementioned SNF sale. Disposition figures as discussed in the Company s 2017 guidance as announced on 04/28/

26 SHOP 2017 GUIDANCE Expectations Overview 70% equilibrium markets driving NOI growth Annual in-place rate increases together with wage inflation Accelerated pace of deliveries, driving mid- to high-single digit NOI declines in non-equilibrium markets A lower starting point going into Q2 together with new deliveries will continue to result in a widening of the occupancy gap vs. prior year 2 Labor Expense Growth 4%-5% (Partially Offset by Non-Labor Operating Expenses) Metrics Occupancy ~200bps Lower (Year-Over-Year for FY 2017) Same-Store NOI Growth 0%-2% 1. Data per Q press release, supplemental, and earnings conference call dated 04/28/ As discussed in VTR s Q earnings conference call. 25

27 ATTRACTIVE SHOP ASSETS VTR SHOP PORTFOLIO HAS HIGH-QUALITY ASSETS IN ATTRACTIVE LOCATIONS Ventas SHOP 1,2 Industry benchmarks Median household income $77,121 $57,462 2 Median home value $420,634 $197, population growth 11.8% 12.2% 2 Building age Note: Demographic figures reflect 3-mile radius from each community. 1. SHOP portfolio represents U.S. portfolio; metrics weighted by NOI; from 1Q17 Ventas supplemental. 2. Demographic data provided by Nielsen and reflects 2017 projections, unless otherwise noted; certain Canadian data is unavailable; population growth reflects Nielsen projections. 3. Latest NIC data; AL/IL supply excluding new construction. 26

28 SHOP ASSETS IN ATTRACTIVE LOCATIONS 23% West Coast NOI 1 SHOP Top 30 MSAs 44% East Coast NOI 1 >67% of SHOP NOI in highbarrier-to-entry coastal markets 1 Median home values 2.1x national average Median household income 1.3x national average Note: Data as of the second quarter ended 03/31/2017, unless otherwise noted. 1. Percentage of U.S. SHOP NOI in coastal markets as shown on map. 27

29 VENTAS SHOP STRATEGY WE HAVE A FOCUSED SHOP PARTNERSHIP STRATEGY VTR SHOP 1 All Others VTR SHOP STRATEGY Focused on building scale with winners driving operational excellence 30% Sunrise 63% Atria Offers partner for future growth and redevelopment Reduces intra-portfolio competition and portfolio overlap Builds deeper strategic relationships >90% Two Focused Operators 1. NOI diversification; Data as of the first quarter ended 03/31/

30 NATIONAL SCALE DRIVES EFFICIENCY EXAMPLE: ATRIA DRIVES EFFICIENCY THROUGH HR AND COST SAVINGS ROBUST PROCESSES FOCUSED ON ATTRACTING, DEVELOPING AND RETAINING TALENT SAVINGS REALIZED ACROSS CORPORATE AND LOCAL COSTS Growth Opportunities 22% Insurance savings through VTR aggregation Robust Training Transition Support 13% 11% Food savings through national culinary program 1 Property management savings via national service contracts Incentives 9% Collateral production savings via in-house print shop Source: Atria internal data, Food cost savings represent change from 2010 costs relative to CPI index for food ( ). 29

31 SALES AND MARKETING OPPORTUNITIES EXAMPLE: ATRIA SELLS VALUE PROPOSITION OF SENIORS HOUSING THROUGH MARKETING Dining Exercise / Physical Activity Transportation Social Life Independence Emergency Assistance Housekeeping Assisted living 40-60% cheaper than recreating benefits at home High-cost market: New York, NY Re-create benefits at home 1 : $12,011 Assisted Living rent 2 : $5,838 Low-cost market: Phoenix, AZ Re-create benefits at home 1 : $7,388 Assisted Living rent 2 : $4,123 ~1% Penetration Rate Increase = Full U.S. Occupancy 1. APFM national average (05/06/2015) adjusted based on local COLA adjustments from Sperling's Best Places (New York: 1.46, Phoenix: 1.04); includes home health rate inflation (24%) based on Department of Social Services CT daily rate for Medicaid covered client adjustment. 2. 1Q17 NIC Average Rent by market (New York, NY and Phoenix, AZ). 30

32 THE HOSPITAL GROWTH OPPORTUNITY EXCELLENCE. FORWARD.

33 VENTAS ACUTE CARE HOSPITAL PORTFOLIO 1 International Hospitals U.S. Acute Care Hospitals Skilled Nursing Life Science Medical Office Loans 5% 1% 6% 19% IRFs & LTACs 7% 1% 6% $2B NOI 25% 30% Seniors Housing - Operating Seniors Housing - NNN Ardent-LHP business model well positioned for healthcare regulatory changes 2/6 Medicaid expansion states ~3x EBITDARM coverage (operator cash flow / rent) 6 diversified states with strong market share Well-capitalized company with ~3.75x net debt / EBITDA Ardent: Q results compared favorably to the best publicly traded hospital systems in the U.S; outstanding performance through Q VTR Ardent-LHP Acquisition Loan: saleleaseback potential and strong ~9% risk adjusted return synergies 1. Data per Q press release, supplemental and earnings conference call dated 04/28/2017. Pro forma for the expected $700M sale of 36 Kindred SNFs to Kindred in 2017 plus additional dispositions for a total $900M of 2017 dispositions including the aforementioned SNF sale. Disposition figures as discussed in the Company s 2017 guidance as announced on 04/28/

34 DEMOGRAPHIC FUNDAMENTALS SUPPLY CONSTRAINED AND UTILIZATION INCREASING U.S. NUMBER OF HOSPITAL BEDS (000s) DAILY VOLUMES (000s) ,050 1, , F F 2020F Source: AHA Hospital Statistics. 1. Daily volumes is "US Adjusted Average Daily Census (000s)" average number of patients receiving care each day during a reported period, adjusted for inpatient vs. outpatient. 33

35 HOSPITALS ARE EVOLVING HOSPITALS remain the NERVE CENTER of healthcare delivery SHORTER LENGTHS OF STAY HIGHER VOLUMES HIGHEST ACUITY CARE 34

36 % of Community Hospitals Total Margin 1 (%) Log Revenue ($M) MARKET CONSOLIDATION RESULTS IN BETTER MARGINS AND CREDIT HOSPITALS INCREASINGLY CONSOLIDATING CONSOLIDATED HOSPITALS HAVE STRONGER MARGINS AND HAVE BETTER CREDIT % 50% 40% 35% Unaffiliated hospitals 8% 6% 4% 6.3% MHS Non-MHS % 50% 60% 65% MHS 2% 3.1% 4.7% 1.9% % Investor- Owned Hospitals Tax-Exempt Hospitals 0 CCC+ B- B B+ BB- BB Credit Rating 2 BB+ 3B 3B+ Ardent-LHP Synergies Will Improve Margins Sources: AHA Chartbook, Journal of Healthcare Finance, "How Prepared are US Hospitals for the Affordable Care Act," Capital IQ. 1. Net income / Total Revenues. 2. n =24 ; all healthcare providers. 35

37 CAPITAL SOURCE TO PROVIDERS TO HELP THEM GROW, CONSOLIDATE AND SERVE PATIENTS State and local government 21% 20% 59% Investorowned Nongovernment, tax-exempt GROWTH OPPORTUNITIES Public companies looking to spin off assets Private capital-backed hospital systems Grow with tax-exempt hospitals LHP provides entrée with valuable not-for-profit partnerships ~5,000 HOSPITALS Long-Term Opportunity, Near- Term Selectivity and Prudent Underwriting 36

38 OUR MEDICAL OFFICE BUILDING PLATFORM EXCELLENCE. ESTABLISHED.

39 VENTAS MEDICAL OFFICE PORTFOLIO 1 Top platform International Hospitals U.S. Acute Care Hospitals Skilled Nursing Life Science Loans 6% 5% 1% IRFs & LTACs 7% 1% 6% $2B NOI 30% Seniors Housing - Operating 400+ customers ~92% total occupancy 95% affiliated or on campus 85% of affiliations are investmentgrade health systems and HCA 2 Medical Office 19% 25% Seniors Housing - NNN Core business with reliable cash flow 1. Data per Q press release, supplemental and earnings conference call dated 04/28/2017. Pro forma for the expected $700M sale of 36 Kindred SNFs to Kindred in 2017 plus additional dispositions for a total $900M of 2017 dispositions including the aforementioned SNF sale. Disposition figures as discussed in the Company s 2017 guidance as announced on 04/28/ Represents cash NOI from assets with investment-grade systems and HCA. 38

40 LILLIBRIDGE NATIONAL MOB FOOTPRINT Corporate Headquarters Regional Office Top 10 Tenant by NOI >20M Square Foot VTR MOB Portfolio 1 Properties Consolidated and unconsolidated square feet. 39

41 SECULAR TRENDS ATTRACTIVE INCREASING POPULATION, INCREASING VISITS, INCREASING SPEND INCREASING POPULATION GROWING PHYSICIAN VISITS HIGHER SPENDING 10,000 New seniors eligible for Medicare daily 1 34M 75+ individuals by 2030 (+14M) 2 2.5x Number of visits 65+ cohort makes to physician offices relative to the rest of the population 3 $6,000 $4,000 $2,000 $0 Seniors 65+ spend 5x more per person 4 $1,000 <25 Years Old $5, Years Old 1. Congressional Budget Office. 2. Source: US Census Bureau, Population Division. 3. Marcus and Millichap, CMS. 4. ISI Real Estate Research and Bureau of Labor Statistics. 40

42 OUR LIFE SCIENCE PLATFORM EXCELLENCE. SUSTAINED.

43 VENTAS LIFE SCIENCE PORTFOLIO 1 6% pro forma 2017 VTR NOI International Hospitals U.S. Acute Care Hospitals Skilled Nursing Life Science Medical Office Loans 6% 5% 1% 19% IRFs & LTACs 7% 1% 6% $2B NOI 25% 30% Seniors Housing - Operating Seniors Housing - NNN >75% of revenue from excellent credit tenants 2 12 universities with avg. Aa2 rating Investment grade companies Public companies with $1B+ equity market capitalization Favorable NNN lease structures 2 10 year weighted average lease term 2% annual rent escalators Exclusive pipeline agreement for growth Near-term development opportunities 1. Data per Q press release, supplemental and earnings conference call dated 04/28/2017. Pro forma for the expected $700M sale of 36 Kindred SNFs to Kindred in 2017 plus additional dispositions for a total $900M of 2017 dispositions including the aforementioned SNF sale. Disposition figures as discussed in the Company s 2017 guidance as announced on 04/28/ Statistics represent 23 operating properties pro forma for the Providence acquisition which is expected to be fully occupied by late 2017 and the Chesterfield and Bailey developments which are expected to open in 2017 /

44 HIGH-QUALITY OPERATING PORTFOLIO WITH INSTITUTIONAL-QUALITY TENANTS Class-A Operating Properties million square feet of purposebuilt real estate with average age of 6 years Located on or contiguous to major campuses 14 LEED-certified buildings High-quality Properties Excellent Amenities for Tenants New Relationships with Institutional-quality Tenants 1. Statistics represent 23 operating properties pro forma for the Providence acquisition announced on 03/14/

45 ADDITIONAL GROWTH FROM NEAR-TERM DEVELOPMENT PROPERTIES The Chesterfield W.F. Innovation Quarter Bailey Power Plant 3675 Market 4220 Duncan Property University Duke (Durham, NC) Wake Forest (Winston Salem, NC) UPenn (Philadelphia, PA) Washington University (St. Louis, MO) Endowment 1 $7.3 billion $1.2 billion $10.7 billion $6.5 billion Life sciences R&D spend 2 $868 million $172 million $656 million $618 million Location On-campus Adjacent to campus Adjacent to campus Close Proximity to WashU Medical School Square feet 286K 111K 344K 182K Tenants Duke University Wake Forest University City Science Center >50% Pre-Leased At Construction Start Opening / endowments; National Association of College and University Business Officers and Commonfund Institute data from National Science Foundation 44

46 ENHANCES VENTAS S RELATIONSHIPS WITH LEADING UNIVERSITIES, ACADEMIC MEDICAL CENTERS AND RESEARCH COMPANIES Geographic Presence and University Affiliations MSA with Lillibridge presence Key Highlights for Leading Tenants Relationships with 12 top research universities that account for ~11% of all university life science R&D spending Average university credit rating of Aa2 Top 10 Tenants by Revenue No. Tenant Sq. ft. (000s) Credit Rating / market cap 1 Wake Forest 661 Aa3 2 Alexion 517 $27B 1 3 Yale 283 Aaa 4 Penn Medicine 268 Aa1 5 Univ. of Maryland 145 Aa1 6 Old Dominion 122 A1 2 7 Inmar 243 B2 8 Therapeutic Proteins 86 NR 9 Paragon 58 NR 10 Eisai, Inc. 169 $16B 3 Total 2, Alexion is not rated; has market capitalization of $27 billion. 2. Only rated by S&P; Moody s equivalent rating is displayed. 3. Eisai is a Japanese company not rated by Moody s or S&P; has market capitalization of US $16 billion. 45

47 LIFE SCIENCE INDUSTRY EXPERIENCING CONTINUED GROWTH Current Life Science Tenants 2014 R&D ($M) University Life Sciences Research Spending Drexel, Old Dominion, IIT $88 Brown $141 Wake Forest $172 Duke $868 Penn State $250 Miami $254 Current tenants account for ~11% of university life Maryland science R&D $382 spend (~$4B) U. of Penn $656 Yale $640 Wash. U. $586 Universities & Research institutions have increased R&D spending $28B $4B $15B $38B $6B $21B $9B $12B Biological sciences Medical sciences Other CAGR +3.6% +4.0% +3.7% +3.2% Biotech M&A Market ($ billions) Chronically Ill Individuals in U.S. (millions) Pharma/Biotech M&A has grown at a +27% CAGR since 2012 $150bn $78bn $173bn $100bn Global Healthcare M&A Volume (deals below $10 billion) $259bn $210bn $158bn $131bn In 2015, 48% of U.S. population has at least 1 chronic illness and 24% have at least Pharma/Biotech Services Medtech Source: Projection of Chronic Illness Prevalence and Cost Inflation (Wu, Shin-Yi et al. 2000); National Science Foundation; CDA CDER Note: Latest data as of 2014; federal scientific research funding represents total funds that are committed by federal agencies to support science-related research at higher education institutions across the U.S. 46

48 POST-ACUTE PORTFOLIO EXCELLENCE. EVOLVED.

49 PRO FORMA VENTAS POST-ACUTE PORTFOLIO 1 Skilled Nursing International Hospitals Loans U.S. Acute Care Hospitals Life Science Medical Office 1% 6% 5% IRFs & LTACs 19% 1% 6% 7% $2B NOI 25% 30% Seniors Housing - Operating Seniors Housing - NNN 1% SNFs post-sale successful deemphasis of SNF starting with CCP spin off Strong 1.8x Q4 IRF & LTAC EBITDARM coverage (operator cash flow / rent) ~6x Kindred adjusted net debt / EBITDAR 2 SNF sale deleveraging and accretive Guaranteed leases Cash flow stability long-term leases through 2023 / Data per Q press release, supplemental and earnings conference call dated 04/28/2017. Pro forma for the expected $700M sale of 36 Kindred SNFs to Kindred in 2017 plus additional dispositions for a total $900M of 2017 dispositions including the aforementioned SNF sale. Disposition figures as discussed in the Company s 2017 guidance as announced on 04/28/ Calculated as Kindred s net debt (long-term debt plus 2017 guided rent expenses multiplied by 6) less cash and cash equivalents, divided by 2017 guided Core EBITDAR. Based on Kindred s Q earnings release and conference call on 05/04/

50 KINDRED HEALTHCARE Diverse Business Mix Impact of LTAC Patient Criteria 3 LTAC Rehab 2 Home Health & Hospice 35% 24% 41% Kindred Kindred 1 12% 88% Genesis Genesis 2 SNF Sale: The sale of the skilled nursing business remains on track and KND sees no impact from the 2019 CMS proposal 10% on the sale process. (BAML, 05/17/2017) SNF LTAC Criteria Mitigation: The company has a three pronged strategy: 1) asset pruning (-15% of beds), 2) replacing lost patients (more compliant patients, managed care), and 3) continue noncompliant patients in low occupancy areas like TX (25% of business). (BAML, 05/17/2017) we remain confident that our mitigation strategies will offset at least half of the expected run-rate impact of LTAC patient criteria by yearend Ben Breier, CEO, Kindred Healthcare (05/03/2017) Q1 LTAC performance in-line with Kindred mitigation strategy [Same-store] nongovernment admissions +4.6% sequentially, and [samestore] compliant admits +3.9% sequentially, consistent with criteria mitigation strategies. Frank Morgan, RBC ~$50M KND Impact 1.8x EBITDARM Cash Rent VTR = 30/82 KND LTACs KND Mitigated Run-Rate Impact (End of 2017) Q3'15 Q4 16 TTM VTR IRF Post-Acute & LTAC EBITDARM EBITDARM Coverage Coverage ~$20M EBITDARM = 0.15x Q3'15 TTM VTR Coverage Pro Forma Impact from Post-Acute ~$20M EBITDARM EBITDARM Change Coverage Impact Expected to Improve through Based on Q revenue before eliminations. Pro forma for Kindred s announced plan to exit its SNF business. 2. Based on 2016 revenue. SNF category corresponds to inpatient services in Genesis 10K and includes AL facilities. Pro forma for the sale of Genesis s home health and hospice business. 3. Information based on Kindred earnings conference calls and press releases. 49

51 SUMMARY Ventas is an S&P 500 diversified provider of capital to leading senior living and healthcare operators and research institutions. Ventas has a long and successful history of outperformance, stability, growth and income with a strong balance sheet. Massive, fragmented healthcare real estate market with strong demand tailwinds and longevity megatrend provide opportunities for growth. The Ventas Advantage of people, platforms and properties will fuel Ventas s continued success. 50

52 EXCELLENCE. SUSTAINED. 1 Welcome Overviewv9.ppt 51

53 DEFINITIONS AND SEC REG. G COMPLIANCE

54 DEFINITION OF TERMS NAREIT Funds from Operations ( FFO ) Net income attributable to common stockholders (computed in accordance with GAAP) excluding gains (or losses) from sales of real estate property, including gain (or loss) on re-measurement of equity method investments and impairment write-downs of depreciable real estate, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis. Normalized FFO We consider normalized FFO to be an appropriate measure of the operating performance of an equity REIT. This measure of operating performance allows investors, analysts and our management to compare operating performance to the operating performance of other real estate companies and between periods on a consistent basis without having to account for differences caused by unanticipated items and other events such as transactions and litigation. Normalized FFO is calculated as NAREIT FFO excluding the following income and expense items (which may be recurring in nature): (i) Deal Costs, (ii) the impact of any expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees, or additional costs, expenses, discounts, make whole payments, penalties or premiums incurred as a result of early retirement or payment of the Company s debt, (iii) the non-cash effect of income tax benefits or expenses, the non-cash impact of changes to the Company s executive equity compensation plan and derivative transactions that have non-cash mark to market impacts on the Company s income statement, (iv) the financial impact of contingent consideration, severance-related costs and charitable donations to the Ventas Charitable Foundation, (v) gains and losses for non-operational foreign currency hedge agreements and changes in the fair value of financial instruments and (vi) gains and losses on non-real estate dispositions and other unusual items related to unconsolidated entities. Cash Flow Coverage For Triple-Net Stabilized assets, operator-reported EBITDARM divided by cash rent for a period. Operator-reported EBITDARM and rent may be adjusted for certain one-time events or out-of-period items. Because Triple-Net financials are delivered to Ventas following the reporting period, Cash Flow Coverage is reported in arrears. 53

55 DEFINITION OF TERMS (CONT D) Seniors Housing Operating Portfolio ( SHOP ) In our senior living operations segment, we invest in seniors housing communities throughout the United States and Canada and engage independent operators, such as Atria and Sunrise, to manage those communities pursuant to long-term management agreements. Ventas realizes the income and expense, including the management fees paid to its independent operators, of the SHOP portfolio in its financial statements. Triple-Net Leased ( NNN ) Portfolio Under our triple-net leased properties segment, we invest in seniors housing and healthcare properties throughout the United States and the United Kingdom and lease those properties to healthcare operating companies under triple-net or absolute-net leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures. The NNN portfolio includes leased seniors housing assets, IRFs & LTACs, skilled nursing facilities, U.S. acute care hospitals and international hospitals. Office Operations Portfolio In our office operations segment, we primarily acquire, own, develop, lease and manage MOBs and life science and innovation centers throughout the United States. Loan Portfolio In our loan portfolio, we make secured and non-mortgage loans relating to seniors housing and healthcare operators or properties. Annualized Revenue & NOI A period s reported revenue and Reported Segment NOI, extrapolated on a per diem, monthly or quarterly basis to an annualized result. Results may be adjusted for certain one-time or out-of-period items, reflect only Ventas s share of ownership and are presented in US dollars ( USD ) based on the applicable exchange rates where revenue and expenses are translated from a foreign currency. Property Net Operating Income ( Property NOI ) For owned assets, reported property-level revenues less reported property-level operating expenses. For debt investments, total interest income. 54

56 2017 GUIDANCE 1,2,3 INCOME, FFO & FAD ATTRIBUTABLE TO COMMON SHAREHOLDERS 1. The Company s guidance constitutes forward-looking statements within the meaning of the federal securities laws and is based on a number of assumptions that are subject to change and many of which are outside the control of the Company. Actual results may differ materially from the Company's expectations depending on factors discussed in the Company s filings with the Securities and Exchange Commission. 2. Totals and per share amounts may not add due to rounding. Per share quarterly amounts may not add to annual per share amounts due to changes in the Company's weighted average diluted share count, if any. Same-store Cash NOI is at constant currency. 3. See page 24 of the Q supplemental for detailed breakout of adjustments for each respective category. 55

57 EARNINGS ($ IN 000S, EXCEPT PER SHARE AMOUNTS) 1 NON-GAAP FINANCIAL MEASURES FFO AND FAD RECONCILIATION INCLUDING COMPARABLE 1. Totals and per share amounts may not add due to rounding. Per share quarterly amounts may not add to annual per share amounts due to material changes in the Company s weighted average diluted share count, if any. 56

58 NORMALIZED FFO ($ IN 000S, EXCEPT PER SHARE AMOUNTS) NON-GAAP FINANCIAL MEASURES 1. Per share amounts may not add due to rounding. 57

59 NON-GAAP FINANCIAL MEASURES ADJUSTED PRO FORMA 1 EBITDA AND NET DEBT TO ADJUSTED PRO FORMA 1 EBITDA ($ IN 000S) 1. The following information considers the pro forma effect on net income, interest and depreciation and amortization of the Com pany s investments and other capital transactions that were completed during the three months ended March 31, 2017 and December 31, 2016, as if the transactions had been consummated as of the beginning of the period. The above table illustrates net debt to pro forma earnings before interest, taxes, depreciation and amortization (including non-cash stockbased compensation expense), excluding gains or losses on extinguishment of debt, income or loss from noncontrolling interest and unconsolidated entities (excluding cash distributions), merger-related expenses and deal costs, expenses related to the reaudit and re-review of our historical financial statements in 2014, net gains on real estate activity, gains or losses on re-measurement of equity interest upon acquisition and changes in the fair value of financial instruments (including amounts in discontinued operations) ( Adjusted Pro Forma EBITDA ). 58

60 NOI RECONCILIATION BY SEGMENT 1,2 ($ IN 000S) NON-GAAP FINANCIAL MEASURES 1. Amounts above are adjusted to exclude discontinued operations for all periods presented. 2. Amounts above are not restated for changes between categories from quarter to quarter. 59

61 SAME-STORE CASH NOI GUIDANCE 1,2 ($ IN 000S) 5. Total may not add across due to minor corporate-level adjustments. 60 NON-GAAP FINANCIAL MEASURES 1. The Company s guidance constitutes forward-looking statements within the meaning of the federal securities laws and is based on a number of assumptions that are subject to change and many of which are outside the control of the Company. Actual results may differ materially from the Company s expectations depending on factors discussed in the Company s filings with the Securities and Exchange Commission. 2. See table titled Same-Store Cash NOI by Segment for detailed breakout of adjustments for each respective category. 3. Includes real estate depreciation and amortization, corporate depreciation and amortization and amortization of other intangibles. 4. Includes interest expense, general and administrative expenses (including stock based compensation), loss on extinguishment of debt, merger-related expenses and deal costs, income from unconsolidated entities, income tax benefit, and other income and expenses.