18 October 2016 REITs US REIT 3016 Earnings Preview Healthcare: Rents continue upward climb as primary markets mostly shrug off new supply 'Figure 90: 1-Month Healthcare performance 1,4 1 141031101 a 6 %61%41% 42% x i ET 3 03 -- 3 i .7,4 il I . . ' -22% 22% .13, ' C% a .4* t 64% -t215 70% U144 611•4104CT 00C 31411 MM MW 14. LTC CM VTR NCO 10 CNC 1401 CCP SPA As of 10/14/16 Swot Cann. Sett Mt Figure 92: Primary mkt Sr Housing ix° & rent growth 0503 1400% glaWilil§ 88RAPAssg§§ Sr Haan° Pen GrOolh —Si 11341000:341 430% 400% 3.50% 3.01 2.00% 110% t 1.00% 0.50% 000% • Sr Housing occupancy up 12bps q/q in 3O but down 9bps y/y • IL occupancy up 16bps q/q and up 2bps y/y • AL occupancy up 6bps q/q and down 22bps y/y • Sr Housing rent growth improved to +3.78% vs +3.18% in 2O driven by IL +4.21% (+3.43% in 2O) and AL +3.16% (+2.81% in 2Q). This is the highest rent growth since 2007 • IL starts declined to 1,500 units in 3Q (2,100 in 2O). staying in line with the 4-quarter average. AL construction starts in primary markets picked up with 2,600 units started in 3Q (2Q starts revised to 2.100 from 1,800), slightly below the rolling 4-quarter average of 2,800 Construction as a % of inventory was down slightly to 5.78% in 3O vs 5.99% in 2O (IL 3.89% from 4.25% and AL 8.34% from 8.36%) 33 dad* ink Nie Ate Own/ Mows Stews Deutsche Bank Securities Inc. 'Figure 91: YTD Healthcare performance Neolibanr wi rt, 110% 3 1 ai".41301% 203 2,04 35324:4% loismo% nn Ox a I LM C1114 Pen 1441 OCT 1.441 CCC URA VTR LTC NIA 10 34 Hai OM MCP CCP As of 10114/16 Sane CM1ZYMV Avg_ SAW Figure 93: Total portfolio SS NOI growth 50% • 45% 40% • 35% • 33 • & 25% • CI 20% 15% g 10% 0 5% • 00% , H211 VTR .2015 13015 44016 41016 882012 J • Pre-3O guidance for both companies implies some deceleration in 2H16 • While rent growth and occupancy remained healthy in 3Q as per NIC data, elevated su