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Good morning.

My name is Jordan, and I will be your conference operator today. At this time, I would like to welcome everyone to the Brookdale Senior Living Inc. Fourth Quarter 2025 Earnings Call. Today's conference call is being recorded. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. At this time, I would now like to turn the conference over to Michael Grant, Brookdale Senior Living Inc.’s Vice President of Investor Relations. Please go ahead. Thank you, operator. Good morning, everyone. Welcome to Brookdale Senior Living Inc.’s fourth quarter 2025 earnings call. Participating on today's call are Nikolas Stengle, Brookdale Senior Living Inc.’s Chief Executive Officer; Dawn L. Kussow, our Executive Vice President and Chief Financial Officer; Mary Sue Patchett, our Chief Operating Officer; and Chad C. White, our Executive Vice President, General Counsel, and Secretary. On today's call, we will discuss fourth quarter and full year 2025 results as well as our financial guidance for the 2026 year. We will also provide other general business updates. During today's call, our remarks, including our answers to your questions, will include forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act. These statements are made as of today's date and we expressly disclaim any obligation to update these statements in the future. Actual results and performance may differ materially from forward-looking statements. Certain other factors that could cause actual results to differ are detailed in the earnings release we issued after market yesterday as well as in our Securities and Exchange Commission filings, including the risk factors described in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. I direct you to the earnings release for the full safe harbor statement. Also, please note that during this call, management will discuss non-GAAP financial measures. For reconciliations of each non-GAAP measure to the most comparable GAAP measure, I direct you to the earnings release and to the company's quarterly supplemental financial information, which may be found at investors.brookdale.com and was furnished on an 8-K yesterday. With that, it is my pleasure to turn the call over to our CEO, Nikolas Stengle. Thank you, Mike. Good morning.

I appreciate everyone for joining us on today's call and for your interest in Brookdale Senior Living Inc. This morning, I will provide a high-level commentary on our fourth quarter and full year 2025 results. I will also review our strategic priorities and guidance for 2026 and our outlook through 2028. Note that we provided preliminary financial highlights for the fourth quarter and full year 2025 on January 28 in advance of our Investor Day, which we held on January 30. Today's results and guidance are consistent with what we previously shared. Speaking of our Investor Day, I would like to thank everyone who participated, and I am especially grateful to those that made the trip to Nashville. Prospective investors, the engagement and insight provided by our investors and equity analysts, both those that formally cover Brookdale Senior Living Inc. and those that have an interest even if not providing coverage today, was amazing. The Brookdale Senior Living Inc. management team left the event with even stronger conviction in our multiyear projection. For those that were unable to participate, we do have the video recording and presentation available on Brookdale Senior Living Inc.’s Investor Relations page. When Brookdale Senior Living Inc. initially provided guidance for 2025 in February, the team guided to RevPAR growth of 4.75% to 5.75% and $430 to $445 million of adjusted EBITDA. Now as we report the completed year, we finished at the top end of our initial RevPAR guidance, at 5.7% and we handily exceeded our initial adjusted EBITDA expectations, delivering $458 million for the year. Likewise, Brookdale Senior Living Inc.’s fourth quarter delivered on our expectations for RevPAR and adjusted EBITDA, as the positive trends seen in the first three quarters of the year continued into the fourth quarter. Let me start by calling out a few highlights from the quarter. First, I would like to highlight occupancy. Our trend of steadily improving occupancy growth continues, and we also continue to see positive movement in addressing our opportunity communities. Our fourth quarter occupancy achieved a weighted average of 82.5–83.5% on a same community basis, our highest level since the beginning of the pandemic in Q1 2020. Notably, our consolidated fourth quarter occupancy represents a 310 basis point improvement over the prior year quarter and a 70 basis point improvement from the preceding sequential 2025. We closed the last day of the quarter with a consolidated occupancy of 83.7% or 84.3% on a same community basis. As our longer-term investors will recall, the 80% occupancy level roughly marks a meaningful inflection point for Brookdale Senior Living Inc.’s margins and cash flow generation due to the fixed cost leverage in our operating model, so we are excited about our continued occupancy progress. While much of this occupancy growth is underpinned by overall market dynamics associated with increasing demand from baby boomers and continued stagnation in inventory growth, our own internal focus on occupancy growth has accelerated our ability to capture the opportunity that exists within the senior living industry. In previous calls and events, we described our SWAT teams. These are internal teams that use a structured process that includes a top-to-bottom review of a community to determine performance opportunities, with tools including capital investment, leadership and marketing assessment, as well as pricing recalibration. As a result of this process and our previously announced disposition and lease termination activity, we continue to see good progress across our occupancy bands. Consolidated communities where occupancy is below 70% fell from 23% of total in 2025 to just 15% of total consolidated communities in 2025. At the other end of the spectrum, 25% of communities exceeded 90% occupancy in 2025 and that percentage increased to 34% by 2025. For the fourth quarter, 80 communities remain below the 70% occupancy threshold. Of those, 14 are expected to be sold during 2026 and 21 are working with our SWAT teams. Excluding communities to be sold or working with SWAT teams, a further 17 need three or fewer move-ins to move out of the sub-70% occupancy band. Adjusted EBITDA is the second item I would like to highlight. For 2025, Brookdale Senior Living Inc. grew adjusted EBITDA 19% to $458 million, a level that exceeded the midpoint of our final guidance for the year—a guidance level that was increased three times earlier in the year. Notably, this 19% growth also marks our fourth consecutive year of double-digit adjusted EBITDA growth. I do want to acknowledge that we fell just short of our adjusted free cash flow guidance of $30 to $50 million. Dawn will provide more color on this metric, but the shortfall is related primarily to timing issues in working capital, and we still delivered significantly positive adjusted free cash flow of $23 million, our first positive year since 2020. Next, I would like to provide an update on how Brookdale Senior Living Inc. is progressing against our five strategic priorities: number one, excelling operationally; number two, optimizing our real estate portfolio; number three, reinvesting capital into our communities; number four, reducing leverage; and number five, elevating quality for residents and associates. Starting with Brookdale Senior Living Inc. excelling operationally, you have already heard about our significant improvements in occupancy and adjusted EBITDA during 2025. There is still plenty of room for improvement as we sprint through various occupancy target milestones. To that end, during the fourth quarter 2025, we brought on an experienced Chief Operating Officer, Mary Sue Patchett. This is the first time in over ten years that Brookdale Senior Living Inc. has had a COO and clearly aligns with the fact that we are, first and foremost, an operating company. Concurrently, we implemented a new regional operating structure with six distinct regional leadership teams that encompass all functions integral to senior living operations. The net effect of these two changes is to have a company that can concurrently draw on the deep resources we have as the largest operator in senior living while also having the nimbleness to operate in a manner similar to six regional companies of roughly 100 communities each. Additionally, we have created and hired the new position of Senior Vice President of Strategic Operations. This role consolidates under a single leader that reports directly to Mary Sue several functions that are key to operations excellence. Chief among them is centralizing our pricing strategy, pricing analytics, and pricing implementation and our labor management. Additionally, this role consolidates prioritization and decision-making for all capital investments that go into our communities. This organizational structure will create a true asset management approach similar to how a portfolio manager would view investment decisions in their portfolio of assets. At the end of the day, these moves will define and sharpen our organization for faster responsiveness and greater accountability. Our second strategic objective is to optimize our real estate portfolio as we continue to focus our portfolio on communities with the strongest long-term value creation potential. By 2026, we anticipate that we will have 517 communities in our consolidated portfolio, meaning communities that we either own or lease. As of December 31, Brookdale Senior Living Inc.’s consolidated portfolio included 548 communities, 370 owned and 178 leased, a reduction of two owned and 43 leased communities since the end of 2025. The significant decline in the lease portfolio represents the completion of our previously disclosed master lease reset with Ventas, from which we will continue to lease 65 communities going forward. As we shared last quarter, during 2026, we anticipate the sale of 29 owned communities and we expect those transactions to generate approximately $200 million of proceeds. These sales mark the final meaningful streamlining of our portfolio, bringing us to our ongoing portfolio of 517 owned and leased communities. As we previously stated, the exit of these groups of assets will result in improved occupancy, RevPAR, and adjusted EBITDA, all while generating cash proceeds that can be used for capital investment. Note, of the 29 assets that remain to be sold at 2025, 14 were in our under-70% occupancy band. Turning now to capital investment. Our total nondevelopment CapEx for 2025 was $170.7 million, most of which was reinvested into capital projects in our communities. Capital investment remains a priority, and we are particularly focused on ensuring that investments are prioritized to community projects that result in improved NOI in addition to necessary life safety and structural improvements. These larger projects often fall under what we call first impressions, or upgrades to public spaces that update aesthetics and functionality, as opposed to the smaller piecemeal replacements we may have favored historically. We believe these larger projects can have an outsized impact on growing occupancy and community-level NOI. For 2026, we are projecting nondevelopment capital investment of approximately $175 to $195 million, an increase from 2025 as we believe investing today will help us capture enhanced occupancy growth and rate into the future. Reducing leverage is the next strategic objective that I would like to comment on. Brookdale Senior Living Inc.’s adjusted annualized leverage at 2025 was 8.9 times adjusted EBITDA on a trailing twelve-month basis, a meaningful improvement from the 9.9 times ratio at the end of the prior year. We will continue to reduce leverage meaningfully as our adjusted EBITDA continues to grow. As a reminder, we believe we can drive leverage to under six times by 2028 primarily through adjusted EBITDA expansion. Notably, 90% of our total debt is non-recourse debt, secured by property-level mortgages. Dawn will provide a deeper update, but following recent refinancing activity, all of our mortgage debt is refinanced through 2026 and our team has made excellent progress toward working with our lenders on the 2027 tranches. The next strategic objective I will discuss is elevating quality for our residents and associates. One of the broadest measures of service delivery quality that we look at is our Net Promoter Score, or NPS. Since 2022, our NPS score has risen steadily. It is now 19 points higher, which is very strong improvement in the eyes of our most important constituents—our residents. This improvement does not happen by accident. We survey our residents consistently to understand what would drive a better product, and we listen and respond through our offerings. We have improved consistently in such areas as food. We have been recognized by outside rating services, such as U.S. News & World Report, for high performance in food and dining across all our care segments, independent living, assisted living, and memory care. Another example of Brookdale Senior Living Inc.’s ability to elevate quality is the continued expansion of our Health Plus platform, which works to improve residents' quality of life through care coordination and chronic condition management resulting in the prevention of avoidable emergency room visits and hospitalizations. During 2025, we rolled Brookdale Health Plus into 58 additional communities across eight states, including three new states. This brings the Brookdale Health Plus platform to a current total of over 180 communities served. Finally, we aim to elevate quality for our associates. One of the best measures of associates’ experience at Brookdale Senior Living Inc. is employee turnover. Turnover of our key three community leaders, meaning the executive director, and the leaders of sales and clinical, improved again in 2025. Our K3 turnover has improved 390 basis points over the past two years. Overall associate turnover across all positions also declined in 2025 and we have now nearly returned to the levels experienced before the pandemic. To close out my remarks, I want to comment on the financial guidance for 2026 that we provided in our earnings release last night and also pre-released in advance of our Investor Day. I will also comment on our longer-term financial outlook. As we look to 2026 and the next several years, we are excited about our outlook. 1946 marked the start of the baby boom with over 600,000 more Americans born in 1946 than were born in 1945. 2026 is the year the first baby boomers hit the 80-year age mark. This age is an important benchmark for Brookdale Senior Living Inc., as over half of our move-ins occur at between 80 to 90 years of age. Our average age at move-in is about 83 years. The demand outlook is robust starting this year but also looking many years into the future. Demographic reports show that the population of 80-year-old Americans will grow at a 4%+ compounded annual rate for the next decade. On the other side of the equation, senior housing supply growth has severely stagnated, and the rate of unit growth at 2025 was just 0.6%, a historical low. Comparing the 80-year-old and greater population growth of 4%+ with the current unit growth of 0.6% indicates a strong trend toward increasing occupancy for the entire senior living industry. For 2026, Brookdale Senior Living Inc. is projecting RevPAR growth of 8% to 9%, which is an improvement over the most recent years. Dawn will dive into the specifics, but the 8% to 9% RevPAR should include a balance of positive occupancy and pricing with some mix support from last year's lease terminations and completed and ongoing dispositions. Occupancy and pricing in excess of cost inflation are both very positive drivers of EBITDA, particularly once communities are above 80% occupancy, the approximate level at which we leverage our fixed costs. As such, we believe we will be able to attain mid-teens adjusted EBITDA growth from our $445,000,020.25 baseline level to $502 to $516 million for 2026. As we look out over the next several years, we expect these trends to continue. As such, we are reiterating our expectation that we can drive mid-teens adjusted EBITDA growth through 2028. Additionally, based on that expansion of adjusted EBITDA, we believe we can end 2028 at under six times leverage. Every day, we are thankful for our residents, our associates, and also our shareholders. Each of you puts your trust in us, and we do not take that lightly. We remain confident in the intrinsic value of the company, which is built upon a bedrock of specialized and scarce real estate. We remain confident in our ability to serve and care for seniors with excellence while being an employer of choice. And we remain confident in our ability to drive durable shareholder value. I will now turn the call over to our CFO, Dawn L. Kussow, for more details on our financial performance and outlook. Thank you, Nick.

This morning, I first want to recap Brookdale Senior Living Inc.’s performance against 2025 targets, then turn to a deeper dive into the fourth quarter, followed by a discussion of our recently issued 2026 guidance and the assumptions that underpin that guidance. As Nick mentioned, we are very pleased with our fourth quarter and full year 2025 financial and operating results. Here is a quick recap of the targets we established for 2025 and how we delivered against them. Our 2025 target for annual RevPAR growth was 4.75% to 5.75%, which we later increased two times to 5.25% to 6%. Brookdale Senior Living Inc. delivered against that target as we reported 5.7% RevPAR growth on a consolidated basis, coming in above the midpoint of our increased target. Our 2025 target for adjusted EBITDA started at $430 to $445 million and increased three times over the course of the year to a range of $455 to $460 million. Again, we delivered on that goal as we reported adjusted EBITDA of $458 million, also above the midpoint of our increased range. For 2025, we set a goal of generating $30 to $50 million in adjusted free cash flow. We fell just short of that goal with full-year 2025 adjusted free cash flow of $23 million. I would characterize this modest shortcoming as related primarily to working capital timing and refinancing-related interest prepayments. Importantly, $23 million in adjusted free cash flow generated in 2025 marks our returning to generating positive cash flow for the first time since 2020. 2025 was also an exciting and successful year for Brookdale Senior Living Inc.’s portfolio transition as we worked to right-size our footprint by exiting nonstrategic or underperforming owned and leased communities. On the lease side, during 2025, Brookdale Senior Living Inc. exited 58 communities with 6,466 units through lease terminations. Notably, pursuant to an amendment of our master lease arrangement with Ventas during December 2024, we agreed to terminate the leases for 55 communities comprising 6,125 units that we had previously leased from Ventas. Most of the associated transitional activity as we exited those 55 leases occurred during the third, and particularly the fourth quarter of 2025 when we exited 42 leases. Note that we will continue to manage eight of those nonrenewed communities. As we enter 2026, we continue to lease 65 communities from Ventas, comprising 4,055 units, through 2035 with an economically improved lease structure, including landlord-funded capital improvement allowance and an annual rent escalator of 3%. During 2025, we also completed the sale of 12 owned communities with 482 units for proceeds of $26.1 million net of transaction costs. As we have previously shared, the disposition of nonstrategic owned communities will continue into 2026 as we plan to sell the remaining 29 previously announced communities comprising 2,364 units. We expect the bulk of these transactions to be completed by mid-year 2026 and we estimate the total proceeds for these communities to be approximately $200 million. Once these dispositions are complete, we do not foresee significant changes to Brookdale Senior Living Inc.’s consolidated portfolio on a forward-looking basis. Turning now to full-year 2025 and fourth quarter financial results. For the year 2025, we expanded our consolidated adjusted EBITDA by $72 million, a 19% increase over 2024.

As Nick mentioned, this is our fourth consecutive year delivering double—

—digit adjusted EBITDA growth, and we believe that we can maintain mid-teens annual growth from our 2025 baseline results over the next several years. During the fourth quarter, our consolidated adjusted EBITDA increased $7 million, or 7% year over year, consistent with our implied guidance from the third quarter. Overall, Brookdale Senior Living Inc. has already made significant progress on our lower-occupied communities through performance improvements and portfolio optimization efforts, and we anticipate further income flow-through as these efforts progress. We are pleased with our continued progress and are optimistic about our ability to drive adjusted EBITDA higher over the next several years. In the fourth quarter, we grew our occupancy sequentially by 70 basis points on a consolidated level and by 50 basis points on a same community level. This is stronger sequential growth as compared to our pre-pandemic sequential growth, and in addition to a strong third quarter, our normal selling season, so growth on top of that is an accomplishment and gives us momentum coming into 2026. Our fourth quarter consolidated weighted average occupancy was 82.5%, an improvement of 310 basis points year over year, our highest year-over-year rate of increase of the year. Brookdale Senior Living Inc. has now reported three consecutive quarters with consolidated weighted average occupancy above 80%, our first quarters above that pivotal 80% level since before the pandemic. For the year, our consolidated weighted average occupancy was 80.9%. On a same community basis, weighted average occupancy for the fourth quarter was 83.5%, representing an increase of 250 basis points year over year. The occupancy growth stems directly from Brookdale Senior Living Inc. initiatives to drive occupancy, including our SWAT approach, targeted pricing actions focused on communities in lower occupancy bands, and a focus on operational accountability. For the full year, same community weighted average occupancy was 82.3%. Turning now to our top line results. For the full year, resident fees increased 2.4% to $3.0 billion. The components of this 2.4% year-over-year growth are a 5.7% increase in RevPAR partially offset by a 3.2% decline in the number of total average available units from our previously announced portfolio optimization, including the disposition of both owned and leased communities. For the fourth quarter, resident fees of $715 million declined by 4% over the fourth quarter of last year. The key factors underpinning the revenue decline versus last year were a 10.5% reduction in total average units, the result of community lease nonrenewals and targeted dispositions, which accelerated in the second half of the year, partially offset by a 7.1% RevPAR increase. The 7.1% increase in RevPAR from the fourth quarter of the prior year was driven by an ongoing acceleration in year-over-year weighted average occupancy. Fourth quarter same community move-ins were 5% below the prior year, while move-out volume was beneficial in the quarter. Resident rate increases more than offset the ongoing trend of lower resident acuity, as revenue per occupied room, or RevPOR—essentially our realized pricing metric—increased 3.1% year over year. The fourth quarter exhibited sequential steady occupancy with notably strong move-in volume to close out the quarter, which should create a tailwind to start the first quarter. Indeed, January 2026 consolidated occupancy improved 310 basis points year over year. Fourth quarter same community RevPAR increased 5% over the prior year, driven by 250 basis points of occupancy growth coupled with a 1.8% increase in RevPOR. Our fourth quarter same community weighted average occupancy continued to improve with 50 basis points of sequential growth. While pre-pandemic, the fourth quarter typically displays the flattest sequential growth trend of the year, Brookdale Senior Living Inc.’s fourth quarter occupancy growth exceeded its normal seasonality for this period. Now turning to expenses. On a consolidated basis, fourth quarter expense per occupied unit, or ExPOR, increased 2.6% over 2024. Our 3.1% increase in RevPOR exceeded the 2.6% increase in ExPOR, generating a 50 basis point positive spread between realized revenue and expenses per occupied unit. As we successfully move lower-occupied communities up in the occupancy band, we expect to see flow-through continue to expand. For 2025, consolidated community RevPOR improved 2.7% while ExPOR increased 1.8%, creating a positive spread of 90 basis points. Same community operating income increased 6.1% for 2025, and operating margin improved by 30 basis points over 2024. Fourth quarter same community operating income grew 4% from the prior year while the operating margin declined by 30 basis points. Note that the fourth quarter typically has a lower operating margin as the quarter has 92 days, which drives labor costs higher than the first two quarters of the year, which have fewer days. Our revenues are based on monthly billings while labor costs reflect hours and days worked. Full year general and administrative expense, excluding noncash stock-based compensation expense and transaction, legal, and organizational restructuring costs, was flat year over year as a percentage of revenue, reflecting cost structure optimization undertaken earlier in the year in advance of the anticipated revenue reduction associated with disposition activity that occurred later in the year. As we complete the optimization of our portfolio, Brookdale Senior Living Inc. will remain focused on the appropriate cost structure. Cash facility operating lease payments during 2025 were $43.7 million, down a significant $12.2 million from $55.9 million in the prior year quarter as a result of the Ventas lease dispositions, which occurred throughout the third and fourth quarter of the year. Adjusted EBITDA for the fourth quarter was $106 million, an increase of $7 million, or 7% above the prior year quarter. For 2025, adjusted EBITDA of $458 million increased 19% year over year. We delivered $23 million of adjusted free cash flow in 2025, marking our return to positive adjusted free cash flow for the first time since 2020. During the fourth quarter, our adjusted free cash flow was an outflow of $23 million. Seasonally, we note that a significant proportion of our annual real estate taxes are paid during the fourth quarter, so the fourth quarter typically requires the use of cash for changes in working capital. Additionally, the timing of working capital and prepayments associated with our refinancing activities negatively impacted adjusted free cash flow. As of 12/31/2025, Brookdale Senior Living Inc.’s total liquidity was $378 million, up $26 million from the third quarter. Our adjusted annualized leverage continues to improve and finished the year at 8.9 times. Our leverage has improved significantly, primarily as a result of our strong adjusted EBITDA growth over the last several years. Now I would like to shift from reviewing the past quarter and year to looking ahead. On January 28, we preannounced fourth quarter financial highlights in advance of our Investor Day event, and in that release, we also included our financial guidance for 2026. Before I get into our specific guidance, I would like to briefly reiterate how Brookdale Senior Living Inc. approaches its guidance philosophy. Delivering on our financial commitments is paramount to what we do. There is a great deal of thought and work that goes into defining appropriate targets—targets that we believe are credible and grounded in reality, but at the same time, compel the Brookdale Senior Living Inc. team to strive for growth and improvement. As a company, we will always look for opportunities to outperform over a multiyear horizon. Our 2026 guidance has two components: 8% to 9% RevPAR growth and $502 to $516 million of adjusted EBITDA. Let us start with our RevPAR target of 8% to 9% annual growth, which reflects accelerated growth in comparison to what we have achieved in the past two years. We believe 8% to 9% RevPAR growth is attainable, and there are a few main components underpinning that growth. First, at the start of this year, we implemented a higher in-place rate increase compared to the prior year, which is supported by higher occupancy levels both at our communities and throughout the industry. Second, occupancy growth is expected to be supported by strong move-in demand, which is a result of both internal efforts as well as the undeniable demographics of America's aging population. The final component is the accretive impact of disposition communities, which will positively impact RevPAR. Our annual guidance for adjusted EBITDA is a range of $502 to $516 million. This guidance is consistent with our longer-term mid-teens adjusted EBITDA annual growth outlook from a baseline of $445 million. Improving occupancy and rate are the key drivers of this adjusted EBITDA expansion, as both have very significant flow-through with Brookdale Senior Living Inc. now exceeding 80% occupancy—roughly at the level at which our fixed costs are covered. Labor is our single largest cost item, at approximately 65% of our facility operating expenses. We have continued to make progress on reducing labor turnover and we project a stable and predictable labor cost environment for 2026. We estimate general and administrative expense, excluding noncash stock-based comp and transaction, legal, and restructuring costs, at approximately $162 million for 2026. Cash facility operating lease payments should be approximately $180 million during 2026. Reflecting on our guidance of adjusted EBITDA expansion to $502 to $516 million, we expect our annualized leverage to continue to decline significantly both in 2026 and in the coming years. Modest additional deleveraging may also result from the disposition activity we are currently undertaking through roughly midyear 2026. We believe that we have the ability to drive leverage below six times by 2028. On the topic of leverage, I would like to highlight that during January, we announced the refinancing of all of our remaining 2026 mortgage debt maturities as well as a portion of our 2027 mortgage debt maturities. These refinancings extend our more imminent maturities, thereby furthering our well-staggered debt maturity schedule. Our intention is to always be proactive in managing our balance sheet, and our improving operating results and strong lender relationships make that possible. As you consider the quarterly progression of our financial results, there are a few factors to keep in mind. Firstly, we will start the year with more available units than we anticipate during the second half of the year, consistent with our planned dispositions. Second, our occupancy rate is expected to ramp over the course of the year, reflecting rising demand, community-level improvements, as well as positive mix dynamics resulting from our dispositions. Other typical seasonal factors are expected to remain consistent with history, and as a reminder, those seasonal factors are called out in the last page of our investor presentation. In conclusion, we are pleased with our fourth quarter and 2025 operating and financial results. As we look forward to 2026 and beyond, we remain confident in our strategic and operational plans, which are generating solid adjusted EBITDA growth. Our team was enhanced significantly during 2025 through the addition of Nick, an operations-focused CEO, and also by the addition of Mary Sue Patchett, as Brookdale Senior Living Inc.’s first dedicated Chief Operating Officer in over a decade. As evidenced by our 2025 results and our outlook, Brookdale Senior Living Inc. is confident in our ability to create sustainable, long-term growth and value for our shareholders. Operator, we will now open the call for questions.

As a reminder, if you would like to ask a question, simply press star followed by the number one on your telephone keypad. Your first question comes from the line of Joshua Richard Raskin from Nephron Research LLC. Your line is live.

Thanks, and good morning. I have actually got two. I guess the first is, and Nick, you started on some of this. Just maybe talk a little about the progress you are making around that transition to an operating company. And if you could give some maybe specific examples. I heard on the workforce side, but maybe changes around workflows or budgeting and how you guys were approaching that as you came into guidance would be helpful. And then second question, just if you could walk us through expected progress on Health Plus. You gave some great statistics for 2025. But I am just curious if you could remind us targets for 2026 rollouts. And have you looked at data around rents or rent increases or, you know, even retention data in the communities that have rolled out Health Plus and maybe where they were the year before and any tangible progress that you can point to.

Yes, excellent. Good morning, Josh. Thanks for the question. I will tackle the first one first, and we will go to the second one. So very clearly, and I have articulated this now several times, both in the Q3 Investor Day and even on this call today, this idea that we are an operating company, first and foremost. Obviously, we have now described Mary Sue’s role as our COO, and she is in the room with us this morning to tackle any really deep-dive ops type questions. That is fundamentally kind of how we are thinking of everything. And the regional model really is an extension of that. So not only do we have a dedicated COO, wake up every morning focused on driving great performance, driving great residents’ and experience, driving move-ins. We also have regional teams. And, again, I sort of described it in the Investor Day, and it is far more impactful maybe even than a slide can really capture. But it is this idea that we have six regional leaders with a dedicated team, and truly dedicated team of a sales leader, a clinical leader, asset management leader, a dining leader, all the different functions so that we can really focus in and be very nimble and very focused on that super hyper-local type decision that a customer faces when they are contemplating senior living. The other part that I just announced during my prepared remarks is we have hired a brand-new position here at Brookdale Senior Living Inc. It is a Senior Vice President of Strategic Operations. This role will consolidate all our pricing decision-making, the analytics, the reporting, the implementation, how we deploy pricing strategy within all our communities. Now we had a similar structure in the past, but it was not truly consolidated under one leader, specifically under operations. Concurrently, in a similar manner, all our labor management, our staffing ratios, our workforce management, overtime control, all those types of things will also be under this role. And probably most importantly, our CapEx decision-making. As I have shared quite a few times now, we are really leaning into this idea of redeploying capital into our communities, and for those that were fortunate enough to be with us at Investor Day and got to do the tour of our Franklin—sorry, our Brookdale Green Hills—community, I think it showed pretty clearly what you can do with a 16-year-old building when you have a very deliberate and comprehensive capital deployment plan, and we are centralizing all that capital deployment and how we think of it under this role. So it is a very meaningful position that we have now hired under this SVP of Strategic Operations. The second part—actually, let me pause there. Mary, is there anything to add on Josh’s question?

I am just very excited about this next step for us because it puts all of those specialized so that we can go to market to support our regions in winning locally. Yep. Perfect.

I think the second question was around Health Plus. So as I shared, we rolled out 58 communities in 2025, expanded our footprint in, I think, three new states if I can recall my prepared remarks correctly there. As far as going forward, the real focus, Josh, and as you recall for those that listened to me yesterday, and again, I encourage everyone who has any interest in Brookdale Senior Living Inc. to take a look at our Investor Day presentation and video that is still on our Investor Relations website. We leaned in on this idea of winning markets, and pivoting the thinking of how we win by saying we will win a market. And the two examples I happened to give at Investor Day were Kansas City and Dallas. Obviously, we are in many more markets where we have some critical density. The Health Plus plan going forward will be to really fill out those gaps that we may still have in markets, use that as yet another lever to driving performance around care, around service. And the net effect of that—and I think this is the next part of your question on Health Plus—is we have seen a definite improvement in turnover of residents. For one, they enjoy and appreciate the care coordination that is provided. Then there is a very practical objective component where they are just going to the hospital less. They are going to the emergency room less. And those are both areas of, I will call them, leakage that happens in our industry where folks who are in assisted living or memory care, if they land in an inpatient unit in a hospital because of some acute event, quite often do not come back to senior living. They go to a different level of care or, unfortunately, sometimes actually pass. So our Health Plus program is helping quite a bit on our retention of residents, which then in turn drives our occupancy growth.

Perfect. Thing I might add to that—

Josh, is that we have also seen some really favorable—

—impacts to our associate turnover rates. Our Health Plus communities—that has actually been very, very good. Our associates like the technology that is provided. They love the system that is in place. It has been very, very beneficially received, and it is helping on the move-in side. As you are able to talk about the benefits of the program and what you can provide to residents, family members love that, and it has been very, very positively received. Yep.

Your next question comes from the line of Joanna Sylvia Gajuk from Bank of America. Your line is live.

Hi. Good morning. Thanks so much for taking the questions. So maybe first, on the centralized pricing strategy. Right? Your peers talk about in-place rent increases in the high single digit. So is that kind of what you were able to push as well? And to that end, have you noticed any change in financial-related move-out because of that?

Yes. Good morning, Joanna. Very good question. And I will characterize what you just said roughly in line with what we were able to achieve with our in-place rate increases that went effective on January 1—mid-to-high single digits is definitely aligned. The way I think we will say it even more clearly, our in-place rate increases for 2026 are more akin to what we did two years ago in 2024 and definitely more than what we did last year. And that is a very important metric because our entire resident base gets the same in-place rate increase, and it, in some ways, underpins our overall RevPOR growth for the entire year. The other thing I want to comment on RevPOR growth is as the year progresses and we get new move-ins, those new move-ins are typically replacing residents who moved in on average, let us say, two years ago back in 2024 when our occupancy was meaningfully lower, where our discounting was a little bit higher. So, typically, as the year will progress, we will be moving in new residents at a different price point than those that are moving out because of the strength in our business, the overall strength in the senior living industry, and for sure, the occupancy that we have within Brookdale Senior Living Inc. specifically.

Yes. And, Joanna, I will follow up on the financial-related move-outs and our experience there. You know, we are monitoring as we roll out our rate increase what we would see, and I would just say that it is relatively in line with what we saw when we rolled out kind of the same rate increase two years ago. Now what I would also say is if you look at our attrition rates, we have seen some favorability in our attrition rates over the two years. Our attrition rate has been coming down, and so that has been favorable. You can see that in our investor presentation, and we are continuing to see that in 2026. K. Thank you. And I have another one, a different topic I guess, somewhat related. But in terms of your CapEx commentary, so you expect the nondevelopment CapEx to increase from last year. Can you give us a little bit more, maybe, details there in terms of the number of projects? And, I guess, as it relates to going forward, you know, without giving specific numbers, I guess, if you are not ready to talk about it. But, you know, how should we think about this, you know, '27, '28, and so on in terms of, you know, how long will it take to touch all locations that need that CapEx? Thank you.

Yes. So I—

—so as a real estate company, you always have to reinvest in real estate no matter the age. And, obviously, the older it is, the more you potentially have to do. But the reality is there will always be ongoing real estate capital reinvestment. That is true of any real estate type, and senior living for sure falls in line. You know, it is fairly highly lived-in type real estate, just as hotels are, just as things of that nature. So I will reiterate what we said we expect to execute, to deploy, in 2026, the range that I had in my prepared remarks. But the reality is that the real focus and the real shift in mindset under this new SVP of Strategic Operations is to really take that asset management perspective, really take this view of we invest into a portfolio to get a return. So if anything, that spend will pivot more towards these larger projects. And we do have a list. I mean, we have prioritized it. We have the high impact, and it kind of is aligned with this idea of winning markets. So we are going to deploy our capital in a more deliberate way in the markets that we want to win so we can create an overall market lift for Brookdale Senior Living Inc. Again, I used Dallas and Kansas City as illustrative markets. There are far more, and, obviously, we will not disclose kind of where our strategy is and where we are leaning in. But that is really the real meaningful part. As far as the spend going forward beyond that, I mean, we cannot, you know, specify a number. But I think if you think of continuing to be roughly in line with what we are doing, feels like a comfortable run rate. We can cover more than enough of the required items while continuing to expand these really high NOI-driving type projects.

Great. Thank you so much for taking the question.

Thank you. Your next question comes from the line of Ben Hendrix from RBC Capital Markets. Your line is live. Great. Thank you very much. Just a quick question on the—

—occupancy bands. I appreciate all the color on the sub-70 bucket. Talked about that a lot, but I wanted to focus a little bit more on the 70 to 80 band, the 90 or so communities there. It is like there is a lot of earnings power in that bucket. I just wanted to think about the timing and considerations for getting those more meaningfully above 80%. Can you maybe talk about those in terms of their profile for key leadership? Are there geography considerations to think about how your pricing strategy shifts to address that bucket? And just anything you can, and CapEx needs, anything that is kind of the gating item for getting those over 80. Thanks.

Yes, great question, Ben. And, oh, by the way, the SWAT communities that we have identified are predominantly in that 70 to 80 and then also the below 70. Now a lot of the below 70 we are disposing, so, obviously, we are not putting a lot of SWAT energy into those as they unwind. But the reality is, even though we quite often benchmark and use milestones around the less than 70, because at that point you are really talking about breakeven, the real magic of flow-through occurs as you enter that 80. So the fact that you are highlighting that is definitely top of mind for us as well, where a lot of our efforts with our SWAT team is actually specifically in that mark. Then, usually, once it accelerates beyond 85 to 90, it is never cruise control or autopilot, but it kind of enters that phase pretty quickly, just based on where the community is. I will tell you that really is kind of the sweet spot of where we focus a lot of our energy: first, let us get communities above breakeven. That usually happens fairly quickly, and, again, we are just booking a lot of them. And then the next point is how do you nudge them, how do you push them beyond that 80% benchmark to get them above—

Yes. And then the other thing that I would add is that there are a few communities—Nick was explicit about the 14 communities in the less than 70 that are on the disposition list. I would say the next largest group on our disposition, because as I said, there are 29 that are coming out in ’26, is in that band as well. And so as they continue to move up, and there is a large number of communities in that 70% to 80% band that are already in our SWAT team group that we are already focused on, whether it is CapEx, it is pricing, it is turnover with our associates—make sure that we are highly focused to continue to move them up. Nick already talked about the progress that we made during the year, and we would expect to continue to make that progress here in ’26.

Great. Thank you. Your next question comes from the line of Brian Gil Tanquilut from Jefferies. Your line is live.

Hey. Good morning, guys, and thanks again for hosting us back in January. So maybe, Nick, as I think about occupancy that you reported for January, it seems like that kind of tracks your typical seasonality for the December to January move. But as we think about the snowstorms or the ice storms that hit the South, how should we be thinking about the recovery that you are seeing there and what it tells you about the health of the demand equation for the business. Thanks. Yes, I appreciate it, Brian. So historically, our December to January sequential occupancy trend is around a 30 to 40 basis point decline, and that is pre-pandemic. Even since the stabilization post-pandemic, that 30 to 40 basis point decline from December to January—very typical, by the way, for the industry and, for sure, Brookdale Senior Living Inc. And that is exactly what we achieved this year, 2026. And I will say that is despite this winter storm. The other reality that occurs in senior living: most move-ins occur at the very end of the month, the last week of the month, and you can see that in our own numbers. If you ever look at our month-end number as compared to the weighted average for the entire month, nearly every month, if not every single month, it is always higher. So the fact that that big storm that kind of transitioned through Texas, where we have a meaningful footprint, through Tennessee, for sure, where we have a meaningful footprint, then off to the East, right in that last week of January, definitely clipped us. I mean, folks did not have power. Everything was frozen over. There are not many move-ins or tours that occur in that environment. So sure, that impacted our occupancy gain in January. But the nice thing about our industry and the nice thing about the segment of the industry we are in—we are in a very nondiscretionary, needs-based, not many alternatives. Oh, by the way, it was the entire market that was impacted. So folks who needed senior living, assisted living in January still need it today. So, in fact, we are already seeing it in our February numbers. The pace of move-ins in the first few weeks of February are already ahead of what we typically see, and that is a direct spillover from January. So I think the better way to look at it is to combine our January and February numbers to get a better sense of how Q1 is progressing. And from our perspective, it is already progressing very nicely as we would expect despite that storm.

Awesome. Thank you.

As a reminder, if you would like to ask a question, simply press 1 on your telephone keypad. Your next question comes from Andrew Mok from Baird. Your line is live.

Good morning. Wanted to follow up on the CapEx spend. I think the range you gave implies about $4,400 per unit across the continuing portfolio. Is that the right level we should be thinking about then? Nick, I think you—yes. I think I heard you say this is a comfortable run rate. So should we be thinking about this as a structural increase in ongoing maintenance CapEx versus a cyclical acceleration? Thanks. Yes, Andrew. I will take the first swing, then Dawn will chime in with some more details. So the per-unit number, I think, is right if you do the math. So 40—now, actually, we have—no. I think, yes, Andrew, we can maybe—

—talk about your units, but I think it is more around that $3,500–$3,600 on a net basis because the number we are giving is a net.

But the real point is we are looking to reinvest in our communities. As we expand our EBITDA and as we expand our cash flow generation—again, overall, thematically, the run rate feels about right. We are also looking to reinvest. And the real point I think I am going to make is even on an—you know, we always look at it on an average per-unit basis. The reality is we are going to overinvest in some communities, so the number will be much higher in a community that we really lean into. Other communities will be, you know, near zero or something almost meaningless as far as the CapEx. And that is the real point of the shift—it is less this idea that we have a bolus, a big grouping of CapEx that we deploy in a peanut-butter-spread type fashion. It is more we are going to target specific communities in specific markets to drive that return and that NOI. So it is less of a piecemeal approach, which is what we have done a little bit of, and more of a comprehensive, targeted, deliberate approach of our CapEx deployment.

Great. And then just a follow-up. I think I heard in the prepared remarks that rate increases offset an ongoing trend of lower resident acuity. Can you elaborate on what you are seeing on the acuity side? Is this a mix effect of younger seniors moving in? An actual decrease in same resident acuity? Thanks.

Yes, I can start, and I think from an acuity side, the comments are around the fact that as you have a higher-acuity resident move out, you generally are having a lower-acuity resident move in, which if you look at our RevPOR throughout the year, you can see that in our rates because of the care rate. You had someone with a higher acuity that is moving out and a higher care rate, and someone lower moving in, you are naturally going to have a lower care rate, which is impacting our RevPOR trending throughout the year. And I think that those are the comments. From an overall acuity level, you know, we obviously monitor overall acuity. As our acuity levels have come down since COVID—we certainly saw them spiking up as we were coming out of COVID—but we certainly have seen them starting to come down. The benefit of that is that you have a longer length of stay with your residents.

Yes. Our overall resident turnover rate is slowly decreasing, which is actually a very positive sign because our length of stay is increasing, which, again, very much underpins overall occupancy growth. So it is kind of a balance between acuity and length of stay. Obviously, the sicker or the older the resident, the less the length of stay. So it is actually balancing out pretty nicely.

Great. Thank you.

There are no further questions. I will now turn the call back over to Nikolas Stengle, CEO, for closing remarks.