Full Press Release Details
FINANCIAL STATEMENTS
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
| Page | ||||
| Report of Independent Registered Public Accounting Firm (PCAOB ID 238) | 2 | |||
| Consolidated Balance Sheets | 4 | |||
| Consolidated Statements of Operations | 5 | |||
| Consolidated Statements of Comprehensive Income (Loss) | 6 | |||
| Consolidated Statements of Stockholders' Equity | 7 | |||
| Consolidated Statements of Cash Flows | 8 | |||
| Notes to Consolidated Financial Statements | 9 |
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of CNL Healthcare Properties, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of CNL Healthcare Properties, Inc. and its subsidiaries (the
"Company") as of December 31, 2025 and 2024, and the related consolidated statements of operations, of comprehensive income (loss), of stockholders' equity and of cash flows for each of the three years in the period ended
December 31, 2025, including the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial
position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in
the United States of America.
These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion
on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to
the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that
we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due
to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included
evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that
was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or
complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate
opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Analysis of Real Estate Assets for
Indicators of Impairment
As described in Notes 2 and 4 to the consolidated financial statements, the net carrying value of the
Company's real estate investment properties was $1.2 billion as of December 31, 2025. Real estate assets are reviewed by management on an ongoing basis to determine whether there are any impairment indicators. Management considers
potential impairment indicators to primarily include (i) changes in a real estate asset's operating performance, such as a current period net operating loss combined with a history of net operating losses, or a projection or forecast that
demonstrates continuing losses associated with the use of a real estate asset or (ii) a current expectation that, more likely than not, a real estate asset will be sold or otherwise disposed of significantly before the end of its previously
estimated holding period.
The principal considerations for our determination that performing procedures relating to the analysis of real
estate assets for indicators of impairment is a critical audit matter are (i) the significant judgment by management when determining impairment indicators, including the real estate assets' operating performance and the estimated holding
period, and (ii) the high degree of auditor judgment and subjectivity in performing procedures related to management's determination of impairment indicators and the real estate assets' operating performance and the estimated
Addressing the matter involved performing procedures and evaluating audit evidence in
connection with forming our overall opinion on the consolidated financial statements. These procedures included, among others (i) evaluating the appropriateness of management's analysis of each real estate asset's operating
performance and the reasonableness of management's determination of whether there were assets with net operating losses that are impairment indicators; (ii) testing the changes to the Company's leases for real estate assets related
to the future minimum lease payment schedules and evaluating the impact to an asset's operating performance; (iii) reading the meeting minutes of the Board of Directors; (iv) inquiring of management about their judgments pertaining
to the Company's evaluation of whether their plans have resulted in the determination that it is more likely than not there has been a change to the estimated holding period of an asset or group of assets; and (v) comparing
management's determination of impairment indicators with evidence obtained in other areas of the audit.
| /s/ PricewaterhouseCoopers LLP |
| Tampa, Florida |
| March 9, 2026 |
| We have served as the Company's auditor since 2010. |
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
thousands, except per share data)
| December 31, | ||||||||
| ASSETS | 2025 | 2024 | ||||||
| Real estate investment properties, net | $ | 1,208,470 | $ | 1,244,663 | ||||
| Cash | 55,989 | 44,011 | ||||||
| Restricted cash | 1,748 | 1,602 | ||||||
| Other assets | 12,658 | 19,095 | ||||||
| Deferred rent, lease incentives and intangibles, net | 9,255 | 9,970 | ||||||
| Total assets | $ | 1,288,120 | $ | 1,319,341 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Liabilities: | ||||||||
| Mortgages and other notes payable, net | $ | - | $ | 15,790 | ||||
| Credit facilities, net | 563,930 | 550,347 | ||||||
| Accounts payable and accrued liabilities | 24,762 | 28,871 | ||||||
| Other liabilities | 11,768 | 11,225 | ||||||
| Due to related parties | 1,435 | 1,327 | ||||||
| Total liabilities | 601,895 | 607,560 | ||||||
| Commitments and contingencies (Note 13) | ||||||||
| Stockholders' equity: | ||||||||
| Preferred stock, $0.01 par value per share, 200,000 shares authorized; none issued or outstanding | - | - | ||||||
| Excess shares, $0.01 par value per share, 300,000 shares authorized; none issued or outstanding | - | - | ||||||
| Common stock, $0.01 par value per share, 1,120,000 shares authorized, 187,958 shares issued and 175,274 shares outstanding | 1,739 | 1,739 | ||||||
| Capital in excess of par value | 1,515,799 | 1,515,799 | ||||||
| Accumulated income | 51,438 | 60,248 | ||||||
| Accumulated distributions | (882,744 | ) | (864,932 | ) | ||||
| Accumulated other comprehensive loss | (7 | ) | (1,073 | ) | ||||
| Total stockholders' equity | 686,225 | 711,781 | ||||||
| Total liabilities and equity | $ | 1,288,120 | $ | 1,319,341 |
See accompanying notes to consolidated financial statements.
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
| Years Ended December 31, | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| Revenues: | ||||||||||||
| Rental income and related revenues | $ | 28,467 | $ | 27,298 | $ | 26,920 | ||||||
| Resident fees and services | 364,180 | 338,662 | 314,560 | |||||||||
| Total revenues | 392,647 | 365,960 | 341,480 | |||||||||
| Operating expenses: | ||||||||||||
| Property operating expenses | 262,516 | 245,537 | 235,524 | |||||||||
| General and administrative expenses | 12,668 | 8,759 | 9,101 | |||||||||
| Asset management fees | 13,846 | 13,353 | 13,856 | |||||||||
| Property management fees | 18,047 | 16,712 | 15,438 | |||||||||
| Financing coordination fees | - | - | 2,671 | |||||||||
| Depreciation and amortization | 51,739 | 50,689 | 51,234 | |||||||||
| Total operating expenses | 358,816 | 335,050 | 327,824 | |||||||||
| Operating income | 33,831 | 30,910 | 13,656 | |||||||||
| Other income (expense): | ||||||||||||
| Interest and other income | 1,704 | 1,141 | 3,113 | |||||||||
| Interest expense and loan cost amortization | (43,645 | ) | (45,858 | ) | (41,873 | ) | ||||||
| Total other expense | (41,941 | ) | (44,717 | ) | (38,760 | ) | ||||||
| Loss before income taxes | (8,110 | ) | (13,807 | ) | (25,104 | ) | ||||||
| Income tax expense | (700 | ) | (611 | ) | (560 | ) | ||||||
| Net loss | (8,810 | ) | (14,418 | ) | (25,664 | ) | ||||||
| Less: Amounts attributable to noncontrolling interests | - | 44 | 34 | |||||||||
| Net loss attributable to common stockholders | $ | (8,810 | ) | $ | (14,462 | ) | $ | (25,698 | ) | |||
| Net loss per share of common stock (basic and diluted) | $ | (0.05 | ) | $ | (0.08 | ) | $ | (0.15 | ) | |||
| Weighted average number of shares of common stock outstanding (basic and diluted) | 173,942 | 173,942 | 173,958 |
See accompanying notes to consolidated financial statements.
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
| Years Ended December 31, | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| Net loss | $ | (8,810 | ) | $ | (14,418 | ) | $ | (25,664 | ) | |||
| Other comprehensive income (loss): | ||||||||||||
| Unrealized gain (loss) on derivative financial instruments | 1,066 | 1,499 | (2,556 | ) | ||||||||
| Total other comprehensive gain (loss) | 1,066 | 1,499 | (2,556 | ) | ||||||||
| Comprehensive loss | (7,744 | ) | (12,919 | ) | (28,220 | ) | ||||||
| Less: Comprehensive income attributable to noncontrolling interest | - | 44 | 34 | |||||||||
| Comprehensive loss attributable to common stockholders | $ | (7,744 | ) | $ | (12,963 | ) | $ | (28,254 | ) |
See accompanying notes to consolidated financial statements.
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(in thousands, except per share data)
| Common Stock | Capital in Excess of Par Value | Accumulated Income (Loss) | Accumulated Distributions | Accumulated Other Comprehensive (Loss) Income | Total Stockholders' Equity | Non- controlling Interest | Total Equity | |||||||||||||||||||||||||||||
| Number of Shares | Par Value | |||||||||||||||||||||||||||||||||||
| Balance at December 31, 2022 | 173,960 | $ | 1,740 | $ | 1,516,926 | $ | 100,408 | $ | (829,307 | ) | $ | (16 | ) | $ | 789,751 | $ | 543 | $ | 790,294 | |||||||||||||||||
| Redemptions of common stock | (18 | ) | (1 | ) | (120 | ) | - | - | - | (121 | ) | - | (121 | ) | ||||||||||||||||||||||
| Net (loss) income | - | - | - | (25,698 | ) | - | - | (25,698 | ) | 34 | (25,664 | ) | ||||||||||||||||||||||||
| Other comprehensive loss | - | - | - | - | - | (2,556 | ) | (2,556 | ) | - | (2,556 | ) | ||||||||||||||||||||||||
| Distribution to noncontrolling interest | - | - | - | - | - | - | - | (100 | ) | (100 | ) | |||||||||||||||||||||||||
| Cash distributions declared ($0.10240 per share) | - | - | - | - | (17,813 | ) | - | (17,813 | ) | - | (17,813 | ) | ||||||||||||||||||||||||
| Balance at December 31, 2023 | 173,942 | $ | 1,739 | $ | 1,516,806 | $ | 74,710 | $ | (847,120 | ) | $ | (2,572 | ) | $ | 743,563 | $ | 477 | $ | 744,040 | |||||||||||||||||
| Net (loss) income | - | - | - | (14,462 | ) | - | - | (14,462 | ) | 44 | (14,418 | ) | ||||||||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | 1,499 | 1,499 | - | 1,499 | |||||||||||||||||||||||||||
| Purchase of noncontrolling interest | - | - | (1,007 | ) | - | - | - | (1,007 | ) | (521 | ) | (1,528 | ) | |||||||||||||||||||||||
| Cash distributions declared ($0.10240 per share) | - | - | - | - | (17,812 | ) | - | (17,812 | ) | - | (17,812 | ) | ||||||||||||||||||||||||
| Balance at December 31, 2024 | 173,942 | $ | 1,739 | $ | 1,515,799 | $ | 60,248 | $ | (864,932 | ) | $ | (1,073 | ) | $ | 711,781 | $ | - | $ | 711,781 | |||||||||||||||||
| Net loss | - | - | - | (8,810 | ) | - | - | (8,810 | ) | - | (8,810 | ) | ||||||||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | 1,066 | 1,066 | - | 1,066 | |||||||||||||||||||||||||||
| Cash distributions declared ($0.10240 per share) | - | - | - | - | (17,812 | ) | - | (17,812 | ) | - | (17,812 | ) | ||||||||||||||||||||||||
| Balance at December 31, 2025 | 173,942 | $ | 1,739 | $ | 1,515,799 | $ | 51,438 | $ | (882,744 | ) | $ | (7 | ) | $ | 686,225 | $ | - | $ | 686,225 |
See accompanying notes to consolidated financial statements.
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Years Ended December 31, | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| Operating activities: | ||||||||||||
| Net loss | $ | (8,810 | ) | $ | (14,418 | ) | $ | (25,664 | ) | |||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||||||
| Depreciation and amortization | 51,739 | 50,689 | 51,234 | |||||||||
| Amortization of loan costs | 5,113 | 5,221 | 2,440 | |||||||||
| Amortization of premium for debt investments | - | - | (17 | ) | ||||||||
| Amortization of discounts | - | - | (760 | ) | ||||||||
| Straight-line rent adjustments | 1,150 | 1,701 | 1,737 | |||||||||
| Loss on extinguishment of debt | 56 | - | 131 | |||||||||
| Other non-cash operating activities | 106 | 1,043 | 4,140 | |||||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Other assets | 2,665 | (3,411 | ) | (1,933 | ) | |||||||
| Accounts payable and accrued liabilities | (2,924 | ) | (2,449 | ) | 1,143 | |||||||
| Other liabilities | 1,150 | 1,879 | (392 | ) | ||||||||
| Due to related parties | 108 | 35 | (105 | ) | ||||||||
| Net cash flows provided by operating activities | 50,353 | 40,290 | 31,954 | |||||||||
| Investing activities: | ||||||||||||
| Capital expenditures | (15,515 | ) | (16,142 | ) | (15,868 | ) | ||||||
| Purchase of held-to-maturity securities | - | - | (4,880 | ) | ||||||||
| Proceeds from maturity of short-term securities | - | - | 30,000 | |||||||||
| Net cash (used in) provided by investing activities | (15,515 | ) | (16,142 | ) | 9,252 | |||||||
| Financing activities: | ||||||||||||
| Distributions to stockholders | (17,812 | ) | (17,812 | ) | (17,813 | ) | ||||||
| Draws under credit facilities | 16,000 | 16,000 | 190,770 | |||||||||
| Repayments on credit facilities | (5,000 | ) | (10,000 | ) | (190,770 | ) | ||||||
| Principal payments on mortgages and other notes payable | (15,850 | ) | (20,968 | ) | (25,284 | ) | ||||||
| Purchase of interest rate caps | (66 | ) | (100 | ) | (3,285 | ) | ||||||
| Payment of loan costs | (15 | ) | (15 | ) | (12,449 | ) | ||||||
| Purchase of noncontrolling interests | - | (1,528 | ) | - | ||||||||
| Distributions to noncontrolling interests | - | - | (100 | ) | ||||||||
| Other financing activities | 29 | - | 39 | |||||||||
| Net cash flows used in financing activities | (22,714 | ) | (34,423 | ) | (58,892 | ) | ||||||
| Net increase (decrease) in cash and restricted cash | 12,124 | (10,275 | ) | (17,686 | ) | |||||||
| Cash and restricted cash at beginning of period | 45,613 | 55,888 | 73,574 | |||||||||
| Cash and restricted cash at end of period | $ | 57,737 | $ | 45,613 | $ | 55,888 | ||||||
| Supplemental disclosure of cash flow information: | ||||||||||||
| Cash paid for interest, net | $ | 38,749 | $ | 41,209 | $ | 34,900 | ||||||
| Cash paid for taxes, net | $ | 784 | $ | 823 | $ | 687 |
See accompanying notes to consolidated financial statements.
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2025
CNL Healthcare Properties, Inc. (the "Company") is a Maryland corporation that elected to be taxed as a real estate investment
trust ("REIT") for United States ("U.S.") federal income tax purposes. The Company has been and intends to continue to be organized and operate in a manner that allows it to remain qualified as a REIT for U.S. federal income
tax purposes. The Company conducts substantially all of its operations either directly or indirectly through: (1) an operating partnership, CHP Partners, LP ("Operating Partnership"), in which the Company is the sole limited partner
and its wholly-owned subsidiary, CHP GP, LLC, is the sole general partner; (2) a wholly-owned taxable REIT subsidiary ("TRS"), CHP TRS Holding, Inc.; (3) property owner and lender subsidiaries, which are single purpose entities; and
(4) through November 1, 2024, an investment in a consolidated joint venture.
The Company is externally managed and advised by
CNL Healthcare Corp. ("Advisor"), which is an affiliate of CNL Financial Group, LLC ("Sponsor"). The Sponsor is an affiliate of CNL Financial Group, Inc. ("CNL"). The Advisor is responsible for managing the
Company's day-to-day operations, serving as a consultant in connection with policy decisions to be made by the board of directors, and for identifying,
recommending and executing on possible strategic alternatives and dispositions on the Company's behalf pursuant to an advisory agreement among the Company, the Operating Partnership and the Advisor (as amended, the "Advisory
Agreement"). Substantially all of the Company's operating, administrative and certain property management services are provided by affiliates of the Advisor. In addition, certain property management services are provided by third-party
In 2017, the Company began evaluating possible strategic alternatives to provide liquidity to the Company's
stockholders. As part of executing under possible strategic alternatives, the Company's board of directors committed to a plan to sell 70 properties, which included medical office buildings, post-acute care facilities, acute care hospitals and
several skilled nursing facilities across the U.S. The Company completed the sale of the last of these 70 properties in 2022. In addition, on November 4, 2025, the Company entered into an Agreement and Plan of Merger (the "Merger
Agreement") with Sonida Senior Living, Inc ("Sonida Senior Living") whereby Sonida Senior Living will acquire 100% of the outstanding common stock of the Company in a cash and stock transaction valued at approximately
$1.80 billion. Under the terms of the Merger Agreement, each outstanding share of the Company's common stock will be converted into shares of Sonida Senior Living common stock based on an exchange ratio set forth in the Merger Agreement
and $2.32 in cash. The exchange ratio is subject to collar mechanisms depending on the trading price of Sonida Senior Living common stock, as set forth in the Merger Agreement. The merger is expected to close on March 11, 2026, subject to
satisfaction of closing conditions described in the Merger Agreement.
As of December 31, 2025, the Company's seniors housing
portfolio was geographically diversified with properties in 26 states and consisted of interests in 70 properties, including 69 seniors housing communities and one vacant land parcel. The Company has primarily leased its seniors housing properties
to wholly-owned TRS entities and engaged independent third-party managers under management agreements to operate the properties under the REIT Investment Diversification and Empowerment Act of 2007 ("RIDEA") structures; however, the
Company has also leased some of its properties to third-party tenants under triple-net or similar lease structures, where the tenant bears all or substantially all of the costs (including cost increases, for
real estate taxes, utilities, insurance and ordinary repairs).
Basis of Presentation and Consolidation - The accompanying consolidated financial statements include the Company's
accounts, the accounts of wholly owned subsidiaries and through November 1, 2024, the accounts of a variable interest entity ("VIE") in which the Company was the primary beneficiary. All material intercompany accounts and
transactions have been eliminated in consolidation.
In accordance with the guidance for the consolidation of a VIE, the Company was
required to identify entities for which control was achieved through means other than voting rights and to determine the primary beneficiary of its VIE. The Company qualitatively assessed whether it was the primary beneficiary of a VIE and
considered various factors including, but not limited to, the design of the entity, its organizational structure including decision-making ability and financial agreements, its ability and the rights of others to participate in policy making
decisions, as well as its ability to replace the VIE manager and/or liquidate the entity. On November 1, 2024, the Company acquired the remaining 5% non-controlling interest and as of December 31,
2025 and 2024, did not have any interests in a VIE.
CNL HEALTHCARE PROPERTIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS