Welltower, Inc. (NYSE: WELL) reported a significant increase in fourth-quarter profit on Tuesday, bolstered by record-breaking occupancy gains and strong pricing power within its seniors housing portfolio.
The real estate investment trust (REIT) posted normalized funds from operations (FFO) a key metric for REIT performance of $1.45 per diluted share, representing a 28.3% increase over the same period last year. The results were driven by a 15.0% year-over-year growth in total portfolio same-store net operating income (SSNOI).
Seniors Housing Strength
The company’s Seniors Housing Operating (SHO) portfolio remained the primary engine of growth, with SSNOI surging 20.4%. This marks the 13th consecutive quarter that the SHO segment has delivered over 20% NOI growth.
Growth in the sector was supported by a 400 basis point increase in average occupancy and a 4.7% rise in revenue per occupied room (RevPOR). Welltower executives attributed the performance to “robust end market demand” and a widening gap between revenue growth and cooling expense inflation, which allowed operating margins to expand by 270 basis points to 30.0%.
Strategic Transformation
During the quarter, Welltower accelerated its shift toward becoming a “pure-play rental housing platform” for the aging population. The company completed $13.9 billion in gross investments, including the massive acquisition of U.K.-based portfolios operated by Barchester and HC-One.
Simultaneously, the REIT capitalized on high demand for medical office space by completing $6.1 billion in property dispositions, primarily from its Outpatient Medical (OM) portfolio. Management noted that the pace of these sales exceeded prior expectations.
Balance Sheet and Outlook
Welltower ended 2025 with a significantly strengthened balance sheet, reporting Net Debt to Adjusted EBITDA of 3.03x and approximately $10.2 billion in available liquidity. Credit rating agencies S&P and Moody’s both upgraded the company’s ratings during the year to “A-” and “A3,” respectively, citing improved leverage and strong operating performance.
Looking ahead, the company introduced 2026 guidance, projecting normalized FFO in the range of $6.09 to $6.25 per diluted share. The outlook assumes continued double-digit SSNOI growth, led by the SHO portfolio.
“We have achieved robust external growth while further reducing leverage,” the company stated in its business update, noting that the aging of the 80+ population continues to provide a “compelling backdrop” for multi-year revenue compounding.
The board of directors declared a quarterly cash dividend of $0.74 per share, a 10.4% increase reflecting confidence in the company’s cash flow trajectory.