HEALTHCARE REALTY TRUST INC - FORM 8-K - EX-99.2 - EXHIBIT 99.2

Attached files

file	filename
EX-99.3 - EXHIBIT 99.3 - HEALTHCARE REALTY TRUST INC	investorpresentation8kma.htm
EX-99.1 - EXHIBIT 99.1 - HEALTHCARE REALTY TRUST INC	exhibit991firstquarter.htm
8-K - 8-K - HEALTHCARE REALTY TRUST INC	hr-2020331xearningsfor.htm

1Q2020

Supplemental Information

FURNISHED AS OF MAY 6, 2020 - UNAUDITED

FORWARD LOOKING STATEMENTS & RISK FACTORS

This Supplemental Information report contains disclosures that are “forward-looking statements” as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include all statements that do not relate solely to historical or current facts and can be identified by the use of words and phrases such as “can,” “may,” “payable,” “indicative,” "predictive," “annualized,” “expect,” “expected,” “range of expectations,” "would have been," "budget," and other comparable terms in this report. These forward-looking statements are made as of the date of this report and are not guarantees of future performance. These statements are based on the current plans and expectations of Company management and are subject to a number of unknown risks, uncertainties, assumptions and other factors that could cause actual results to differ materially from those described in this release or implied by such forward-looking statements. Such risks and uncertainties include, among other things, the following: the duration and scope of the COVID-19 pandemic; the impact of the COVID-19 pandemic on occupancy rates and on the operations of the Company and its tenants; actions governments take in response to the COVID-19 pandemic, including the introduction of public health measures and other regulations affecting the Company’s properties and the operations of the Company and its tenants; the effects of health and safety measures adopted by the Company and its tenants related to the COVID-19 pandemic; the impact of the COVID-19 pandemic on the business and financial condition of tenants; general economic uncertainty in key markets as a result of the COVID-19 pandemic and a worsening of global economic conditions or low levels of economic growth

changes in the economy; increases in interest rates; the availability and cost of

capital at expected rates; changes to facility-related healthcare regulations; competition for quality assets; negative developments in the operating results or financial condition of the Company's tenants, including, but not limited to, their ability to pay rent and repay loans; the Company's ability to reposition or sell facilities with profitable results; the Company's ability to re-lease space at similar rates as vacancies occur; the Company's ability to renew expiring long-term single-tenant net leases; the Company's ability to timely reinvest proceeds from the sale of assets at similar yields; government regulations affecting tenants' Medicare and Medicaid reimbursement rates and operational requirements; unanticipated difficulties and/or expenditures relating to future acquisitions and developments; changes in rules or practices governing the Company's financial reporting; the Company may be required under purchase options to sell properties and may not be able to reinvest the proceeds from such sales at rates of return equal to the return received on the properties sold; uninsured or underinsured losses related to casualty or liability; the incurrence of impairment charges on its real estate properties or other assets; and other legal and operational matters. Other risks, uncertainties and factors that could cause actual results to differ materially from those projected are detailed under the heading “Risk Factors,” in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) for the year ended December 31, 2019, under the heading "Risk Factors" in the Company's Quarterly Report on Form 10-Q filed with the SEC for the quarter ended March 31, 2020, and other risks described from time to time thereafter in the Company's SEC filings. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Table of Contents



4		Highlights
5		Salient Facts
6		Corporate Information
7		Balance Sheet
8		Statements of Income
9		FFO, Normalized FFO, & FAD
10		Capital Funding & Commitments
11		Debt Metrics
12		Debt Covenants
13		Acquisition & Disposition Activity
14		Investment Activity
15		Portfolio
16		Associated Health Systems
17		Top Tenants
18		MOB Proximity to Hospital
19		Lease Maturity, Lease & Building Size
20		Historical Occupancy
21		Occupancy Reconciliation
22		Same Store Leasing Statistics
23		Same Store Performance
24		NOI Reconciliations
26		EBITDA Reconciliations
27		Components of Net Asset Value
28		Components of Expected FFO

Copies of this report may be obtained at www.healthcarerealty.com or by contacting Investor Relations at 615.269.8175 or communications@healthcarerealty.com.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 3

Highlights

QUARTERLY HIGHLIGHTS

Normalized FFO per share increased 4.4% over first quarter of 2019.

For the trailing twelve months ended March 31, 2020, same store cash NOI grew 2.4%.


•	Revenues increased 2.7% and revenue per average occupied square foot increased 2.8%.


•	Average occupancy was stable at 89.2%.

Predictive growth measures in the same store multi-tenant portfolio include:


•	Average in-place rent increases of 2.89%


•	Future annual contractual increases of 3.11% for leases commencing in the quarter


•	Weighted average cash leasing spreads of 4.4% on 289,000 square feet renewed:


◦	12% (<0% spread)


◦	6% (0-3%)


◦	51% (3-4%)


◦	31% (>4%)


•	Tenant retention of 84.0%

Portfolio leasing activity in the first quarter totaled 459,000 square feet related to 141 leases:


•	343,000 square feet of renewals


•	116,000 square feet of new and expansion leases

During the first quarter, the Company acquired seven medical office buildings for $102.0 million totaling 339,000 square feet. Each of these acquisitions expands an existing relationship or market presence and was acquired on or before March 13, 2020. Acquisitions included:


•	In Los Angeles, an 87,000 square foot building adjacent to AA- rated MemorialCare Health's Saddleback Medical Center for $42.0 million.


•	In Atlanta, a 65,000 square foot building adjacent to A rated Wellstar Health System's Kennestone Hospital for $12.0 million.


•	In Raleigh, a 16,000 square foot building adjacent to A2 rated WakeMed's North Hospital for $6.3 million.


•	In Colorado Springs, a 34,000 square foot off campus building near BBB+ rated CommonSpirit Health's St. Francis Medical Center for $8.2 million.


•	In Denver, three buildings totaling 137,000 square feet adjacent to AA rated UCHealth's Highlands Ranch Hospital for $33.5 million.

In February, the first lease commenced at the Company's 151,000 square foot development on the campus of AA+ rated UW Medicine's Valley Medical Center in Seattle. The medical office building is currently 60% leased.

On March 18, 2020, the Company issued $300 million of Senior Notes due March 2030 with a coupon rate of 2.40%.

Net debt to adjusted EBITDA was 5.3 times at the end of the quarter.

A dividend of $0.30 per share was declared for the first quarter. Dividends paid totaled $40.4 million, which equaled 74.2% of normalized FFO and 88.7% of FAD.

OTHER ITEMS OF NOTE

General and administrative expense increased in the first quarter of 2020 over the fourth quarter of 2019 by approximately $0.9 million due to customary increases in payroll taxes, non-cash ESPP expense and healthcare savings account fundings. Approximately $0.8 million is not expected to recur in subsequent quarters.

In May 2019, the Company entered into a $150 million unsecured term loan due 2026 with a delayed draw feature that was extended through May 2020. The Company expects to draw the $150 million term loan at the end of May and the credit spread will be 50 basis points higher than has been paid to carry this balance on the revolver during the delayed draw period.

On March 18, 2020, the Company issued $300 million of unsecured senior notes due 2030. The notes were issued at an effective rate of 2.71%. As compared to the Company's line of credit effective rate of 1.89%, the Company expects additional interest expense of approximately $0.6 million per quarter.

As of March 31, 2020, the Company's cash balance was $103.4 million. In April 2020, the Company reduced its cash balance to approximately $50 million and paid down its unsecured credit facility.

The Company added disclosures to its March 31, 2020 Form 10-Q regarding the impact of COVID-19. In addition, the Company provided a business update furnished as Exhibit 99.3 to the Form 8-K on May 6, 2020, which provides additional information.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 4

Salient Facts

AS OF MARCH 31, 2020



	Properties

	$4.4B invested in 212 properties
	15.8M SF owned in 25 states
	12.0M SF managed by Healthcare Realty
	93.9% medical office and outpatient
	87.8% on/adjacent to hospital campuses
	2.4% same store cash NOI growth (TTM)


	Capitalization

	$5.5B enterprise value as of 4/30/20
	$4.0B market capitalization as of 4/30/20
	134.9M shares outstanding as of 4/30/20
	$0.30 quarterly dividend per share
	BBB/Baa2/BBB+ S&P/Moody's/Fitch
	29.2% net debt to enterprise value at 3/31/20
	5.3x net debt to adjusted EBITDA




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 5

Corporate Information

Healthcare Realty Trust is a real estate investment trust that integrates owning, managing, financing and developing income-producing real estate properties associated primarily with the delivery of outpatient healthcare services throughout the United States. As of March 31, 2020, the Company owned 212 real estate properties in 25 states totaling 15.8 million square feet and was valued at approximately $5.3 billion. The Company provided leasing and property management services to 12.0 million square feet nationwide.

CORPORATE HEADQUARTERS

Healthcare Realty Trust Incorporated

3310 West End Avenue, Suite 700

Nashville, Tennessee 37203

Phone 615.269.8175 Fax 615.269.8461

communications@healthcarerealty.com

www.healthcarerealty.com

EXECUTIVE OFFICERS

Todd J. Meredith

President and Chief Executive Officer

John M. Bryant, Jr.

Executive Vice President and General Counsel

J. Christopher Douglas

Executive Vice President and Chief Financial Officer

Robert E. Hull

Executive Vice President - Investments

ANALYST COVERAGE

BMO Capital Markets

Berenberg Capital Markets LLC

BTIG, LLC

CapitalOne Securities, Inc.

Citi Research

Green Street Advisors, Inc.

J.P. Morgan Securities LLC

Jefferies LLC

JMP Securities LLC

KeyBanc Capital Markets Inc.

Mizuho Securities USA Inc

Morgan Stanley & Co, LLC

Raymond James & Associates

SMBC Nikko Securities America, Inc.

Wells Fargo Securities, LLC

BOARD OF DIRECTORS

J. Knox Singleton

Chairman, Healthcare Realty

Retired Chief Executive Officer, Inova Health System

Todd J. Meredith

President and Chief Executive Officer

Healthcare Realty Trust Incorporated

John V. Abbott

Retired Chief Executive Officer

Aviation Asset Management Group, General Electric Company

Nancy H. Agee

President and Chief Executive Officer

Carilion Clinic

Edward H. Braman

Retired Audit Partner

Ernst & Young LLP

Peter F. Lyle

Executive Vice President

Medical Management Associates, Inc.

Bruce D. Sullivan

Retired Audit Partner

Ernst & Young LLP

Christann M. Vasquez

Executive Vice President and Chief Operating Officer

Ascension Texas

David R. Emery (1944-2019)

Chairman Emeritus

Healthcare Realty Trust Incorporated




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 6

Balance Sheet

DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA



ASSETS
	1Q 2020			4Q 2019			3Q 2019			2Q 2019			1Q 2019
Real estate properties
Land		$319,882			$289,751			$267,803			$247,772			$230,206
Buildings, improvements and lease intangibles	4,126,046			3,986,326			3,915,308			3,845,546			3,757,260
Personal property	10,783			10,538			10,899			10,804			10,739
Construction in progress	—			48,731			44,041			36,996			40,326
Land held for development	24,647			24,647			24,647			24,647			24,647
Total real estate properties	4,481,358			4,359,993			4,262,698			4,165,765			4,063,178
Less accumulated depreciation and amortization	(1,164,462		)	(1,121,102		)	(1,106,387		)	(1,064,408		)	(1,035,800		)
Total real estate properties, net	3,316,896			3,238,891			3,156,311			3,101,357			3,027,378
Cash and cash equivalents	103,370			657			11,809			7,617			11,313
Assets held for sale, net	20			37			5,289			6,615			10,568
Operating lease right-of-use assets	125,040			126,177			126,711			127,326			128,141
Financing lease right-of-use assets	12,615			12,667			9,063			9,095			9,259
Other assets	189,708			185,426			181,975			176,537			175,864
Total assets		$3,747,649			$3,563,855			$3,491,158			$3,428,547			$3,362,523

LIABILITIES AND STOCKHOLDERS' EQUITY
	1Q 2020			4Q 2019			3Q 2019			2Q 2019			1Q 2019
Liabilities
Notes and bonds payable		$1,644,454			$1,414,069			$1,443,919			$1,442,758			$1,343,110
Accounts payable and accrued liabilities	64,574			78,517			75,094			60,394			61,519
Liabilities of properties held for sale	74			145			300			511			633
Operating lease liabilities	91,093			91,574			91,356			91,056			91,044
Financing lease liabilities	17,953			18,037			14,305			14,216			14,294
Other liabilities	70,073			61,504			61,023			50,168			46,144
Total liabilities	1,888,221			1,663,846			1,685,997			1,659,103			1,556,744
Commitments and contingencies
Stockholders' equity
Preferred stock, $.01 par value; 50,000 shares authorized	—			—			—			—			—
Common stock, $.01 par value; 300,000 shares authorized	1,349			1,347			1,314			1,292			1,292
Additional paid-in capital	3,494,123			3,485,003			3,379,572			3,305,344			3,302,814
Accumulated other comprehensive loss	(19,777		)	(6,175		)	(8,470		)	(6,189		)	(1,611		)
Cumulative net income attributable to common stockholders	1,131,619			1,127,304			1,100,094			1,097,494			1,093,010
Cumulative dividends	(2,747,886		)	(2,707,470		)	(2,667,349		)	(2,628,497		)	(2,589,726		)
Total stockholders' equity	1,859,428			1,900,009			1,805,161			1,769,444			1,805,779
Total liabilities and stockholders' equity		$3,747,649			$3,563,855			$3,491,158			$3,428,547			$3,362,523




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 7

Statements of Income

DOLLARS IN THOUSANDS




	1Q 2020			4Q 2019			3Q 2019			2Q 2019			1Q 2019			4Q 2018			3Q 2018			2Q 2018
Revenues
Rental income		$122,644			$119,438			$117,740			$114,351			$110,696			$111,149			$111,452			$109,566
Other operating	2,163			2,086			2,059			1,966			1,961			2,019			2,010			2,068
	124,807			121,524			119,799			116,317			112,657			113,168			113,462			111,634
Expenses
Property operating	49,552			46,214			46,777			44,286			42,725			42,815			44,135			41,737
General and administrative ¹	8,766			7,669			10,802			7,845			8,510			8,534			8,504			8,373
Acquisition and pursuit costs ²	750			515			501			422			305			200			141			120
Depreciation and amortization	47,497			46,134			45,137			43,926			42,662			42,437			42,061			40,130
Bad debts, net of recoveries ³	—			—			—			—			—			18			(62		)	104
	106,565			100,532			103,217			96,479			94,202			94,004			94,779			90,464
Other income (expense)
Gain (loss) on sales of real estate properties	(49		)	20,036			200			4,849			15			10,787			1,288			29,590
Interest expense	(13,960		)	(13,816		)	(14,181		)	(13,850		)	(13,588		)	(13,602		)	(13,464		)	(13,069		)
Impairment of real estate assets	—			(7		)	—			(5,610		)	—			—			—			—
Interest and other income (expense), net	82			5			—			(743		)	9			(35		)	41			38
	(13,927		)	6,218			(13,981		)	(15,354		)	(13,564		)	(2,850		)	(12,135		)	16,559
Net income		$4,315			$27,210			$2,601			$4,484			$4,891			$16,314			$6,548			$37,729


1	The Company's former Executive Chairman, David R. Emery, died on September 30, 2019 resulting in $2.9 million of expenses in the third quarter of 2019 for the acceleration of his outstanding restricted stock awards and associated taxes.


2	Includes third party and travel costs related to the pursuit of acquisitions and developments.


3	Beginning in the first quarter of 2019 with the adoption of Accounting Standards Codification Topic 842, bad debts, net of recoveries associated with lease revenue was recorded within rental income.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 8

FFO, Normalized FFO, & FAD ^{1, 2}

DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA




	1Q 2020			4Q 2019			3Q 2019			2Q 2019			1Q 2019			4Q 2018			3Q 2018			2Q 2018
Net income		$4,315			$27,210			$2,601			$4,484			$4,891			$16,314			$6,548			$37,729
(Gain) loss on sales of real estate assets	49			(20,036		)	(200		)	(4,849		)	(15		)	(10,787		)	(1,288		)	(29,590		)
Impairments of real estate assets	—			7			—			5,610			—			—			—			—
Real estate depreciation and amortization	48,611			47,042			45,926			44,682			43,383			43,380			42,723			40,747
FFO		$52,975			$54,223			$48,327			$49,927			$48,259			$48,907			$47,983			$48,886
Acquisition and pursuit costs ³	750			515			501			422			305			200			141			120
Lease intangible amortization ⁴	745			4			5			54			84			—			—			—
Accelerated stock awards ⁵	—			—			2,854			—			—			—			70			—
Debt financing costs	—			—			—			760			—			—			—			—
Normalized FFO		$54,470			$54,742			$51,687			$51,163			$48,648			$49,107			$48,194			$49,006
Non-real estate depreciation and amortization	823			838			838			829			763			790			845			829
Non-cash interest expense amortization ⁶	746			731			727			707			702			649			661			652
Provision for bad debt, net	(83		)	124			(32		)	150			(75		)	18			(62		)	104
Straight-line rent income, net	(660		)	(781		)	(379		)	(1		)	(270		)	(302		)	(413		)	(683		)
Stock-based compensation	2,599			2,133			2,375			2,372			2,639			2,601			2,605			2,593
Normalized FFO adjusted for non-cash items	57,895			57,787			55,216			55,220			52,407			52,863			51,830			52,501
2nd generation TI	(6,040		)	(12,126		)	(6,114		)	(6,124		)	(4,326		)	(10,367		)	(6,950		)	(7,755		)
Leasing commissions paid	(2,824		)	(4,970		)	(2,697		)	(2,315		)	(1,347		)	(2,182		)	(1,139		)	(1,947		)
Capital expenditures	(3,470		)	(5,159		)	(3,543		)	(4,993		)	(3,462		)	(2,817		)	(6,229		)	(7,117		)
FAD		$45,561			$35,532			$42,862			$41,788			$43,272			$37,497			$37,512			$35,682
Dividends paid		$40,416			$40,121			$38,852			$38,771			$37,614			$37,571			$37,570			$37,569
FFO per common share - diluted		$0.40			$0.41			$0.37			$0.39			$0.39			$0.39			$0.39			$0.39
Normalized FFO per common share - diluted		$0.41			$0.41			$0.40			$0.40			$0.39			$0.40			$0.39			$0.40
FFO weighted average common shares outstanding - diluted⁷	133,980			133,125			129,015			128,279			124,928			124,240			124,192			123,983

Funds from operations (“FFO”) and FFO per share are operating performance measures adopted by the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”). NAREIT defines FFO as “net income (computed in accordance with GAAP) excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity.”

FFO, Normalized FFO and Funds Available for Distribution ("FAD") do not represent cash generated from operating activities determined in accordance with accounting principles generally accepted in the United States of America and is not necessarily indicative of cash available to fund cash needs. FFO, Normalized FFO and FAD should not be considered alternatives to net income attributable to common stockholders as indicators of the Company's operating performance or as alternatives to cash flow as measures of liquidity.


3	Acquisition and pursuit costs include third party and travel costs related to the pursuit of acquisitions and developments.

The Company adopted the 2018 NAREIT FFO White Paper Restatement during the first quarter of 2019. This amended definition specifically includes the impact of acquisition related market lease intangible amortization in the calculation of NAREIT FFO. The Company historically included this amortization in the real estate depreciation and amortization line item which is added back in the calculation of NAREIT FFO. Prior periods were not restated for the adoption.


5	The Company's former Executive Chairman, David R. Emery, died on September 30, 2019 resulting in $2.9 million of expenses recorded in the third quarter of 2019 associated with the acceleration of his outstanding non-vested share-based awards. The third quarter of 2018 includes a revaluation adjustment recorded in connection with an officer retirement.


6	Includes the amortization of deferred financing costs, discounts and premiums.


7	Diluted weighted average common shares outstanding for the three months ended March 31, 2020 includes the dilutive effect of nonvested share-based awards outstanding of 830,024.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 9

Capital Funding & Commitments

DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA



ACQUISITION AND RE/DEVELOPMENT FUNDING
	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019
Acquisitions ¹	$102,030		$107,408		$78,681		$102,225		$93,000
Re/development ¹	6,916		7,028		7,359		6,916		7,281
1st gen. TI & acquisition capex ²	2,731		8,184		3,793		4,934		2,887

MAINTENANCE CAPITAL EXPENDITURES
	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019
$ Spent
2nd generation TI	$6,040		$12,126		$6,114		$6,124		$4,326
Leasing commissions paid	2,824		4,970		2,697		2,315		1,347
Capital expenditures	3,470		5,159		3,543		4,993		3,462
	$12,334		$22,255		$12,354		$13,432		$9,135
% of Cash NOI
2nd generation TI	8.0	%	16.2	%	8.4	%	8.5	%	6.2	%
Leasing commissions paid	3.8	%	6.7	%	3.7	%	3.2	%	1.9	%
Capital expenditures	4.6	%	6.9	%	4.9	%	6.9	%	5.0	%
	16.4	%	29.8	%	17.0	%	18.6	%	13.1	%

LEASING COMMITMENTS
	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019
Renewals
Square feet	342,614		381,561		756,211		366,524		575,195
2nd generation TI/square foot/lease year	$1.65		$3.15		$2.12		$1.75		$2.12
Leasing commissions/square foot/lease year	$0.80		$0.91		$0.86		$0.43		$0.60
WALT (in months) ³	46.3		56.6		55.0		53.0		46.3

New leases
Square feet	97,305		117,274		95,948		123,918		78,947
2nd generation TI/square foot/lease year	$4.07		$5.06		$4.79		$5.18		$5.06
Leasing commissions/square foot/lease year	$1.06		$1.60		$1.29		$1.05		$0.91
WALT (in months) ³	75.3		69.0		74.3		60.7		59.6

All
Square feet	439,919		498,835		852,159		490,442		654,142
2nd generation TI/square foot/lease year	$2.41		$3.67		$2.51		$2.71		$2.56
Leasing commissions/square foot/lease year	$0.88		$1.10		$0.92		$0.60		$0.64
Leasing commitments as a % of annual net rent	14.9	%	21.0	%	14.0	%	15.7	%	14.4	%
WALT (in months) ³	52.7		59.5		57.2		55.0		47.9


1	Acquisitions exclude the first quarter of 2020 purchase of land previously ground leased totaling $1.6 million.


2	Planned capital expenditures for acquisitions include expected near-term fundings that were contemplated as part of the acquisition.


3	WALT = weighted average lease term.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 10

Debt Metrics

DOLLARS IN THOUSANDS



SUMMARY OF INDEBTEDNESS AS OF MARCH 31, 2020
	INTEREST EXPENSE	PRINCIPAL BALANCE	BALANCE ¹	MONTHS TO MATURITY	CONTRACTUAL RATE		EFFECTIVE RATE
Senior notes due April 2023	$2,398	$250,000	$248,647	37	3.75	%	3.95	%
Senior notes due May 2025 ²	2,469	250,000	248,584	61	3.88	%	4.08	%
Senior notes due January 2028	2,775	300,000	295,768	93	3.63	%	3.84	%
Senior notes due March 2030 ³	279	300,000	296,211	120	2.40	%	2.71	%
Total senior notes outstanding	$7,921	$1,100,000	$1,089,210	80	3.38	%	3.61	%
$700 million unsecured credit facility due May 2023	1,880	215,000	215,000	38	LIBOR + 0.90%		1.89	%
$200 million unsecured term loan facility due May 2024 ⁴	1,703	200,000	199,069	50	LIBOR + 1.00%		3.20	%
$150 million unsecured term loan facility due June 2026 ⁵	—	—	—	74	LIBOR + 1.60%		NA
Mortgage notes payable, net	1,649	141,325	141,175	54	4.76	%	4.70	%
Total outstanding notes and bonds payable	$13,153	$1,656,325	$1,644,454	69	3.28	%	3.43	%
Interest cost capitalization	(421)
Unsecured credit facility fee and deferred financing costs	991
Financing lease right-of-use assets	237
Total quarterly consolidated interest expense	$13,960



DEBT MATURITIES SCHEDULE AS OF MARCH 31, 2020
	PRINCIPAL PAYMENTS										WEIGHTED AVERAGE RATE
	CREDIT FACILITY		TERM LOANS		SENIOR NOTES		MORTGAGE NOTES		TOTAL		MORTGAGE NOTES		OTHER		TOTAL
2020							$16,249		$16,249		6.09	%	—	%	6.09	%
2021							17,996		17,996		5.52	%	—	%	5.52	%
2022							13,396		13,396		3.84	%	—	%	3.84	%
2023	$215,000				$250,000		30,665		495,665		4.23	%	2.89	%	2.97	%
2024			$200,000				26,419		226,419		4.51	%	3.20	%	3.36	%
2025					250,000		2,411		252,411		5.30	%	3.88	%	3.89	%
2026							25,214		25,214		3.97	%	—	%	3.97	%
2027							785		785		6.38	%	—	%	6.38	%
2028					300,000		380		300,380		6.63	%	3.63	%	3.63	%
Thereafter					300,000		7,810		307,810		6.85	%	2.40	%	2.51	%
Total	$215,000		$200,000		$1,100,000		$141,325		$1,656,325		4.76	%	3.14	%	3.28	%
Weighted average rate	1.89	%	3.20	%	3.38	%	4.76	%	3.28	%


1	Balances are reflected net of discounts and deferred financing costs and include premiums.


2	The effective interest rate includes the impact of the $1.7 million settlement of a forward-starting interest rate swap that is included in accumulated other comprehensive income on the Company's Condensed Consolidated Balance Sheets.


3	The effective interest rate includes the impact of the $4.3 million settlement of forward interest rate hedges that are included in accumulated other comprehensive income on the Company's Condensed Consolidated Balance Sheets.


4	The effective interest rate includes the impact of interest rate swaps on $175.0 million at a weighted average rate of 2.29% (plus the applicable margin rate, currently 100 basis points).


5	As of March 31, 2020, there are no outstanding loans under the $150 million unsecured term loan due June 2026. This term loan has a delayed draw feature that allows the Company up to May 29, 2020 to draw against the commitments.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 11

Debt Covenants

DOLLARS IN THOUSANDS



SELECTED FINANCIAL DEBT COVENANTS TTM ENDED MARCH 31, 2020 ¹
	CALCULATION	REQUIREMENT	PER DEBT COVENANTS
Revolving credit facility and term loan ²
Leverage ratio ³	Total debt/total capital	Not greater than 60%	35.7	%
Secured leverage ratio	Total secured debt/total capital	Not greater than 30%	3.0	%
Unencumbered leverage ratio ³	Unsecured debt/unsecured real estate	Not greater than 60%	37.5	%
Fixed charge coverage ratio	EBITDA/fixed charges	Not less than 1.50x	4.3x
Unsecured coverage ratio	Unsecured EBITDA/unsecured interest	Not less than 1.75x	4.8x
Construction and development	CIP/total assets	Not greater than 15%	0.0	%
Asset investments	Mortgages & unimproved land/total assets	Not greater than 20%	0.9	%

Senior Notes due 2030 ⁴
Incurrence of total debt ³	Total debt/total assets	Not greater than 60%	35.7	%
Incurrence of debt secured by any lien	Secured debt/total assets	Not greater than 40%	3.0	%
Maintenance of total unsecured assets ³	Unencumbered assets/unsecured debt	Not less than 150%	279.3	%
Debt service coverage	EBITDA/interest expense	Not less than 1.5x	4.9x

Other Senior Notes ⁵
Incurrence of total debt ³	Total debt/total assets	Not greater than 60%	37.0	%
Incurrence of debt secured by any lien	Secured debt/total assets	Not greater than 40%	3.2	%
Maintenance of total unsecured assets ³	Unencumbered assets/unsecured debt	Not less than 150%	270.4	%
Debt service coverage	EBITDA/interest expense	Not less than 1.5x	4.8x

Other
Net debt to adjusted EBITDA ⁶	Net debt (debt less cash)/adjusted EBITDA	Not required	5.3x
Net debt to enterprise value ⁷	Net Debt/enterprise value	Not required	29.2	%


1	Does not include all financial and non-financial covenants and restrictions that are required by the Company's various debt agreements.


2	As part of the Company's amendment to the credit facility and term loan agreements during the second quarter of 2019, the financial covenants were updated to exclude the impact of the Topic 842, Lease Accounting from the covenant calculations.


3	As of March 31, 2020, the Company had cash of $103.4 million. These financial covenant results would improve if the Company used this cash to repay the credit facility.


4	The financial covenants for the Senior Note due 2030 exclude the impact of Topic 842, Lease Accounting from the financial covenant calculations.


5	The senior note covenants calculations apply to the Senior Notes due 2025 and 2028. The Senior Notes due 2023 have similar covenants but contain a less restrictive definition of total assets.


6	Adjusted EBITDA is based on the current quarter results, annualized. See page 26 for a reconciliation of adjusted EBITDA. Net debt does not include lease liabilities.


7	Based on the closing price of $27.93 on March 31, 2020 and 134,932,206 shares outstanding. Debt does not include lease liabilities.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 12

Acquisition & Disposition Activity

DOLLARS IN THOUSANDS



ACQUISITION ACTIVITY
MARKET	TYPE ¹	MILES TO CAMPUS	ASSOCIATED HEALTH SYSTEM	CLOSING	PURCHASE PRICE	SQUARE FEET	LEASED %		CAP RATE ²
Los Angeles, CA	MOB	0.14	MemorialCare Health	1/3/2020	$42,000	86,986	79	%	5.3	%
Atlanta, GA	MOB	0.10	Wellstar Health System	2/13/2020	11,965	64,624	94	%	5.6	%
Raleigh, NC	MOB	0.04	WakeMed Health	2/25/2020	6,325	15,964	100	%	6.7	%
Colorado Springs, CO	MOB	1.60	None	3/9/2020	8,240	34,210	100	%	6.5	%
Denver, CO ³	MOB	0.24	UCHealth	3/13/2020	33,500	136,994	94	%	6.1	%
Total ⁴					$102,030	338,778	91	%	5.8	%



HISTORICAL INVESTMENT ACTIVITY
	ACQUISITIONS		RE/DEVELOPMENT FUNDING		TOTAL INVESTMENTS		DISPOSITIONS
2016	$241,939		$45,343		$287,282		$94,683
2017	327,167		32,305		359,472		122,700
2018	111,450		35,567		147,017		98,691
2019	381,314		28,584		409,898		54,860
YTD 2020	102,030		6,916		108,946		—
Average (2016-2019)	265,468		35,450		300,917		92,734
% of Total	88.2	%	11.8	%	100.0	%


1	MOB = Medical office building


2	For acquisitions, cap rate represents the forecasted first year NOI divided by purchase price.


3	Includes three properties.


4	Total excludes the first quarter of 2020 purchase of land previously ground leased totaling $1.6 million.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 13

Investment Activity

DOLLARS IN THOUSANDS



RE/DEVELOPMENT ACTIVITY
MARKET	MILES TO CAMPUS	ASSOCIATED HEALTH SYSTEM	SQUARE FEET	BUDGET	FUNDINGS THRU 3/31/20	REMAINING FUNDINGS	LEASED %		EXPECTED CASH NOI AT LEASED %	EXPECTED STABILIZED YIELD
Development
Seattle, WA	0.00	UW Medicine	151,031	$64,120	$54,127	$9,993	60	%	$617	7.0	%
Redevelopment
Memphis, TN ¹	0.26	Baptist Memorial	110,883	27,800	10,169	17,631	90	%	489	7.6	%
Total			261,914	$91,920	$64,296	$27,624	73	%	$1,106



RE/DEVELOPMENT EXPECTED CASH NOI AND OCCUPANCY RAMP UP TO LEASED % ²
MARKET	INITIAL OCCUPANCY	Q1 2020		Q2 2020		Q3 2020		Q4 2020		Q1 2021		Q2 2021		Q3 2021
Development
Seattle, WA
Cash NOI		$111		$386		$617		$617		$621		$633		$633
Average occupancy	Q1 2020	10	%	40	%	60	%	60	%	60	%	60	%	60	%
Redevelopment
Memphis, TN
Cash NOI		—		—		—		$42		$306		$489		$489
Average occupancy	Q4 2019	44	%	44	%	44	%	44	%	67	%	90	%	90	%
Total Cash NOI		$111		$386		$617		$659		$927		$1,122		$1,122


1	The project includes the acquisition of a 110,883 square foot medical office building for $8.7 million and redevelopment costs related to the property.


2	Does not reflect the impact of capitalized interest that will be reduced at lease commencement.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 14

Portfolio ¹

DOLLARS IN THOUSANDS



MARKETS (BY SQUARE FEET)
				MOB 93.9%				NON-MOB 6.1%
MARKET	MSA RANK	INVESTMENT	COUNT	MULTI-TENANT		SINGLE-TENANT		INPATIENT/SURGICAL		OFFICE		TOTAL		% OF TOTAL
Dallas, TX	4	$519,494	25	2,073,198				156,245		145,365		2,374,808		15.0	%
Seattle, WA	15	646,333	26	1,456,720		67,510						1,524,230		9.6	%
Nashville, TN	36	202,499	6	766,523						108,691		875,214		5.5	%
Charlotte, NC	22	181,215	16	860,735								860,735		5.4	%
Los Angeles, CA	2	294,037	15	796,783				63,000				859,783		5.4	%
Denver, CO	19	186,257	12	694,362						93,869		788,231		5.0	%
Houston, TX	5	149,040	9	563,760						57,170		620,930		3.9	%
Atlanta, GA	9	228,692	10	588,641		19,732						608,373		3.8	%
Richmond, VA	44	149,459	7	548,801								548,801		3.5	%
Des Moines, IA	87	139,527	7	197,994		181,961				152,655		532,610		3.4	%
Indianapolis, IN	33	119,775	4	526,194								526,194		3.3	%
Memphis, TN	43	98,161	7	515,876								515,876		3.3	%
Washington, DC	6	150,528	6	507,336								507,336		3.2	%
San Antonio, TX	24	95,739	6	473,673								473,673		3.0	%
Oklahoma City, OK	41	126,326	4	180,049		200,000						380,049		2.4	%
Austin, TX	30	108,004	5	375,333								375,333		2.4	%
Chicago, IL	3	93,582	3	352,800								352,800		2.2	%
Honolulu, HI	56	144,187	3	298,427								298,427		1.9	%
San Francisco, CA	12	122,190	3	286,270								286,270		1.8	%
Colorado Springs, CO	79	62,677	4	275,434								275,434		1.7	%
Miami, FL	7	59,470	4	241,980								241,980		1.5	%
Other (16 markets)		563,795	30	1,510,657		322,482		186,000				2,019,139		12.8	%
Total		$4,440,987	212	14,091,546		791,685		405,245		557,750		15,846,226		100.0	%
Number of properties				193		11		3		5		212
% of square feet				88.9	%	5.0	%	2.6	%	3.5	%	100.0	%
Investment¹				$3,842,048		$238,937		$221,496		$138,506		$4,440,987
Quarterly cash NOI				$63,490		$4,961		$5,487		$1,457		$75,395
% of cash NOI				84.2	%	6.6	%	7.3	%	1.9	%	100.0	%



BY BUILDING TYPE
	MOB TOTAL		MULTI-TENANT		SINGLE-TENANT		TOTAL
Number of properties	204		198		14		212
Square feet	14,883,231		14,649,296		1,196,930		15,846,226
% of square feet	93.9	%	92.4	%	7.6	%	100.0	%
Occupancy %	86.2	%	85.7	%	100.0	%	86.8	%
Investment¹	$4,080,985		$3,980,554		$460,433		$4,440,987
Quarterly cash NOI	$68,451		$64,947		$10,448		$75,395
% of cash NOI	90.8	%	86.1	%	13.9	%	100.0	%


1	Excludes assets held for sale, land held for development, construction in progress, Memphis Redevelopment and corporate property.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 15

Associated Health Systems ¹



MOB PORTFOLIO (BY SQUARE FEET)
	SYSTEM RANK ³	CREDIT RATING	ASSOCIATED 94.8%²						OFF CAMPUS			% OF TOTAL MOB
HEALTH SYSTEM	SYSTEM RANK ³	CREDIT RATING	ON		ADJACENT ⁴		ANCHORED ⁵		OFF CAMPUS		TOTAL MOB	% OF TOTAL MOB
Baylor Scott & White Health	20	AA-/Aa3	1,834,256		280,941		163,188		—		2,278,385	15.3	%
Ascension Health	4	AA+/Aa2	1,080,681		156,328		—		—		1,237,009	8.3	%
CommonSpirit Health ⁶	3	BBB+/Baa1	807,182		311,310		95,486		—		1,213,978	8.2	%
Atrium Health	29	AA-/Aa3	393,815		98,066		313,513		—		805,394	5.4	%
Tenet Healthcare	7	B/B2	570,264		67,790		—		—		638,054	4.3	%
UW Medicine (Seattle)	49	AA+/Aaa	345,567		102,540		44,166		125,543		617,816	4.1	%
Bon Secours Mercy Health	78	A+/A1	548,801		—		—		—		548,801	3.7	%
Wellstar Health System	84	A/A2	476,054		64,624		—		—		540,678	3.6	%
Indiana University Health	26	AA/Aa2	423,628		102,566		—		—		526,194	3.5	%
Baptist Memorial Health Care	95	BBB+/--	424,306		—		39,345		52,225		515,876	3.5	%
UCHealth	68	AA/Aa3	150,291		298,093		33,850		—		482,234	3.2	%
HCA	2	BB+/Ba2	177,340		167,017		—		78,305		422,662	2.8	%
Trinity Health	6	AA-/Aa3	267,952		73,331		—		—		341,283	2.3	%
Providence St. Joseph Health	5	AA-/Aa3	176,854		129,181		—		—		306,035	2.1	%
Hawaii Pacific Health	195	--/A1	173,502		—		—		124,925		298,427	2.0	%
Inova Health System	76	AA+/Aa2	262,121		—		—		—		262,121	1.8	%
Medstar Health	39	A/A2	241,739		—		—		—		241,739	1.6	%
Advocate Aurora Health Care	14	AA/Aa3	142,955		95,436		—		—		238,391	1.6	%
Overlake Health System	339	A/A2	191,051		39,659		—		—		230,710	1.6	%
MultiCare Health System	110	AA-/Aa3	154,452		63,039		—		—		217,491	1.5	%
Memorial Hermann	43	A+/A1	—		206,090		—		—		206,090	1.4	%
Mercy (St. Louis)	37	AA-/Aa3	—		—		200,000		—		200,000	1.3	%
Other (23 credit rated systems)			907,321		962,796		146,689		—		2,016,806	13.6	%
Subtotal - credit rated⁷			9,750,132		3,218,807		1,036,237		380,998		14,386,174	96.7	%
Non-credit rated			102,555		—		—		394,502		497,057	3.3	%
Total			9,852,687		3,218,807		1,036,237		775,500		14,883,231	100.0	%
% of total			66.2	%	21.6	%	7.0	%	5.2	%


1	Excludes construction in progress, Memphis Redevelopment and assets classified as held for sale.


2	Includes total square feet of buildings located on-campus, adjacent and off-campus/anchored by healthcare systems.


3	Ranked by revenue based on Modern Healthcare's Healthcare Systems Financials Database.


4	The Company defines an adjacent property as being no more than 0.25 miles from a hospital campus.


5	Includes buildings where health systems lease 40% or more of the property.


6	Previously Catholic Health Initiatives.


7	Based on square footage, 88.7% is associated with an investment-grade rated healthcare provider.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 16

Top Tenants ¹




			# OF ASSOCIATED PROPERTIES		LEASED SQUARE FEET
TENANT	SYSTEM RANK ²	CREDIT RATING	# OF ASSOCIATED PROPERTIES	# OF LEASES	MOB	INPATIENT	TOTAL	% OF TOTAL LEASED		% OF TTM REVENUE
Baylor Scott & White Health	20	AA-/Aa3	24	152	929,826	156,245	1,086,071	7.9	%	8.3	%
Atrium Health	29	AA-/Aa3	16	78	633,065	—	633,065	4.6	%	4.2	%
CommonSpirit Health ³	3	BBB+/Baa1	17	73	566,525	—	566,525	4.1	%	4.0	%
Mercy (St. Louis)	37	AA-/Aa3	2	2	200,000	186,000	386,000	2.8	%	3.8	%
Indiana University Health	26	AA/Aa2	4	62	440,507	—	440,507	3.2	%	2.8	%
Ascension Health	4	AA+/Aa2	11	68	389,657	—	389,657	2.8	%	2.7	%
WellStar Health System	84	A/A2	8	51	347,821	—	347,821	2.5	%	2.2	%
UW Medicine (Seattle)	49	AA+/Aaa	9	27	230,152	—	230,152	1.7	%	1.8	%
Bon Secours Mercy Health	78	A+/A1	7	59	276,541	—	276,541	2.0	%	1.7	%
Proliance Surgeons	-	–	7	18	146,539	—	146,539	1.1	%	1.6	%
UCHealth	68	AA/Aa3	8	14	221,718	—	221,718	1.6	%	1.4	%
Baptist Memorial Health Care	95	BBB+/--	7	25	193,187	—	193,187	1.4	%	1.4	%
Medstar Health	39	A/A2	3	53	151,463	—	151,463	1.1	%	1.3	%
Tenet Healthcare	7	B/B2	10	31	111,991	63,000	174,991	1.3	%	1.1	%
Trinity Health	6	AA-/Aa3	3	31	165,250	—	165,250	1.2	%	1.0	%
USPI ⁴	-	–	6	11	124,590	—	124,590	0.9	%	1.0	%
Providence St. Joseph Health	5	AA-/Aa3	6	22	100,739	—	100,739	0.7	%	1.0	%
Eating Recovery Center	-	B-/Caa1	4	7	104,193	—	104,193	0.8	%	1.0	%
Hawaii Pacific Health	195	--/A1	3	35	91,072	—	91,072	0.7	%	0.9	%
MultiCare Health System	110	AA-/Aa3	4	18	128,978	—	128,978	0.9	%	0.9	%
DaVita	-	BB/Ba2	11	13	115,646	—	115,646	0.8	%	0.9	%
Inova Health	76	AA+/Aa2	3	10	90,533	—	90,533	0.7	%	0.9	%
Labcorp of America	-	BBB/Baa2	22	24	175,012	—	175,012	1.3	%	0.8	%
Memorial Hermann	43	A+/A1	2	2	99,874	—	99,874	0.7	%	0.6	%
HCA	2	BB+/Ba2	6	14	82,236	—	82,236	0.6	%	0.6	%
Kaiser Permanente	1	AA-/--	3	9	101,830	—	101,830	0.7	%	0.6	%
Overlake Health System	339	A/A2	2	8	73,676	—	73,676	0.5	%	0.6	%
Allina Health	58	AA-/Aa3	2	9	76,929	—	76,929	0.6	%	0.6	%
Advocate Aurora Health Care	14	AA/Aa3	2	10	58,027	—	58,027	0.4	%	0.5	%
Cedars-Sinai Health	66	--/Aa3	1	14	47,661	—	47,661	0.3	%	0.5	%
Total				950	6,475,238	405,245	6,880,483	49.9	%	50.7	%


1	Excludes construction in progress, Memphis Redevelopment and assets classified as held for sale.


2	Ranked by revenue based on Modern Healthcare's Healthcare Systems Financials Database.


3	Previously Catholic Health Initiatives.


4	As of December 31, 2019, USPI is approximately 95% owned by Tenet Health.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 17

MOB Proximity to Hospital ^{1, 2}



MEDICAL OFFICE BUILDINGS BY LOCATION
	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019		4Q 2018
On campus	66.2	%	67.4	%	68.4	%	68.9	%	70.0	%	69.3	%
Adjacent to campus ³	21.6	%	20.2	%	19.3	%	18.7	%	17.9	%	18.3	%
Total on/adjacent	87.8	%	87.6	%	87.7	%	87.6	%	87.9	%	87.6	%
Off campus - anchored by health system ⁴	7.0	%	7.2	%	6.7	%	7.3	%	7.6	%	7.8	%
Off campus	5.2	%	5.2	%	5.6	%	5.1	%	4.5	%	4.6	%
	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%



DISTANCE TO HOSPITAL CAMPUS
									GROUND LEASE PROPERTIES
GREATER THAN	LESS THAN OR EQUAL TO	# OF PROPERTIES	SQUARE FEET	% OF TOTAL		CUMULATIVE %		CAMPUS PROXIMITY	SQUARE FEET	% OF TOTAL
	0.00	123	9,852,687	66.2	%	66.2	%	On campus	7,667,107	89.4	%
0.00	250 yards	32	1,907,746	12.8	%	79.0	%	Adjacent ³	128,717	1.5	%
250 yards	0.25 miles	24	1,311,061	8.8	%	87.8	%	Adjacent ³	120,036	1.4	%
0.25 miles	0.50	4	286,818	1.9	%	89.7	%	Off campus	124,925	1.4	%
0.50	1.00	2	280,873	1.9	%	91.6	%		—	—	%
1.00	2.00	6	553,656	3.7	%	95.3	%		319,446	3.7	%
2.00	5.00	7	352,316	2.4	%	97.7	%		13,818	0.2	%
5.00	10.00	3	205,631	1.4	%	99.1	%		205,631	2.4	%
10.00		3	132,443	0.9	%	100.0	%		—	—	%
Total		204	14,883,231	100.0	%				8,579,680	100.0	%


1	Excludes construction in progress, Memphis Redevelopment and assets classified as held for sale.


2	Proximity to hospital campus includes acute care hospitals with inpatient beds. The Company does not consider inpatient rehab hospitals (IRFs), skilled nursing facilities (SNFs) or long-term acute care hospitals (LTACHs) to be hospital campuses for distance calculations.


3	The Company defines an adjacent property as being no more than 0.25 miles from a hospital campus.


4	Includes buildings where health systems lease 40% or more of the property.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 18

Lease Maturity, Lease & Building Size ¹



LEASE MATURITY SCHEDULE
	MULTI-TENANT				SINGLE-TENANT				TOTAL
	# OF LEASES	SQUARE FEET	% OF SQUARE FEET		# OF LEASES	SQUARE FEET	% OF SQUARE FEET		# OF LEASES	SQUARE FEET	% OF TOTAL SQUARE FEET		% OF BASE REVENUE ²
2020	583	2,148,104	17.1	%	1	83,318	7.0	%	584	2,231,422	16.2	%	15.7	%
2021	540	1,821,260	14.5	%	—	—	—	%	540	1,821,260	13.2	%	12.9	%
2022	499	1,740,012	13.9	%	1	58,285	4.9	%	500	1,798,297	13.1	%	13.1	%
2023	373	1,594,065	12.7	%	—	—	—	%	373	1,594,065	11.6	%	11.9	%
2024	418	1,888,577	15.0	%	1	63,000	5.2	%	419	1,951,577	14.2	%	13.5	%
2025	191	957,141	7.6	%	2	91,561	7.6	%	193	1,048,702	7.6	%	7.7	%
2026	117	469,493	3.7	%	—	—	—	%	117	469,493	3.4	%	3.0	%
2027	92	409,445	3.3	%	2	342,245	28.6	%	94	751,690	5.5	%	7.8	%
2028	98	555,694	4.4	%	2	235,419	19.7	%	100	791,113	5.8	%	5.9	%
2029	105	612,343	4.9	%	3	165,342	13.8	%	108	777,685	5.7	%	5.5	%
Thereafter	84	359,475	2.9	%	2	157,760	13.2	%	86	517,235	3.7	%	3.0	%
Total leased	3,100	12,555,609	85.7	%	14	1,196,930	100.0	%	3,114	13,752,539	86.8	%	100.0	%
Total building		14,649,296	100.0	%		1,196,930	100.0	%		15,846,226	100.0	%
WALTR (months) ³		42.3				84.0				46.0
WALT (months) ³		86.7				165.5				93.6



# OF LEASES BY SIZE			BY BUILDING SIZE
LEASED SQUARE FEET	MULTI-TENANT ⁴	SINGLE-TENANT	BUILDING SQUARE FEET	% OF TOTAL		TOTAL SQUARE FOOTAGE	AVERAGE SQUARE FEET	# OF PROPERTIES
0 - 2,500	1,666	—	>100,000	41.7	%	6,602,108	146,714	45
2,501 - 5,000	759	—	<100,000 and >75,000	25.6	%	4,055,599	86,289	47
5,001 - 7,500	247	—	<75,000 and >50,000	17.4	%	2,763,848	62,815	44
7,501 - 10,000	146	—	<50,000 and >25,000	13.0	%	2,060,730	38,162	54
10,001 +	282	14	<25,000	2.3	%	363,941	16,543	22
Total Leases	3,100	14	Total	100.0	%	15,846,226	74,746	212


1	Excludes land held for development, construction in progress, Memphis Redevelopment, corporate property and assets classified as held for sale.


2	Represents the current annualized minimum rents on in-place leases, excluding the impact of potential lease renewals and straight-line rent.


3	WALTR = weighted average lease term remaining; WALT = weighted average lease term.


4	The average lease size in the multi-tenant properties is 4,050 square feet.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 19

Historical Occupancy ¹

DOLLARS IN THOUSANDS



SAME STORE PROPERTIES
	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019		4Q 2018
Multi-tenant
Investment	$3,248,042		$3,240,598		$3,004,110		$2,946,524		$2,894,291		$2,897,873
Number of properties	157		157		149		147		150		151
Total building square feet	12,243,069		12,243,069		11,675,944		11,533,207		11,432,246		11,490,212
Period end % occupied	87.9	%	88.3	%	87.6	%	88.3	%	88.1	%	88.6	%
Single-tenant
Investment	$460,433		$460,415		$461,845		$461,794		$463,261		$471,319
Number of properties	14		14		14		14		14		14
Total building square feet	1,196,930		1,196,930		1,252,198		1,252,198		1,252,198		1,307,713
Period end % occupied	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Total same store properties
Investment	$3,708,475		$3,701,013		$3,465,955		$3,408,318		$3,357,552		$3,369,192
Number of properties	171		171		163		161		164		165
Total building square feet	13,439,999		13,439,999		12,928,142		12,785,405		12,684,444		12,797,925
Period end % occupied	89.0	%	89.3	%	88.8	%	89.5	%	89.3	%	89.8	%

PROPERTIES NOT IN SAME STORE
	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019		4Q 2018
Acquisitions ²
Investment	$606,061		$500,063		$637,827		$574,793		$520,418		$437,835
Number of properties	31		24		30		27		24		22
Total building square feet	1,826,029		1,487,251		1,935,189		1,803,890		1,648,552		1,381,323
Period end % occupied	86.9	%	86.1	%	90.1	%	91.1	%	91.0	%	92.5	%
Development completions
Investment	53,669		—		—		$29,798		$29,388		$29,375
Number of properties	1		—		—		1		1		1
Total building square feet	151,031		—		—		99,957		99,957		99,957
Period end % occupied	20.2	%	—	%	—	%	41.8	%	41.8	%	38.4	%
% leased	60.0	%	—	%	—	%	44.9	%	41.8	%	41.8	%
Reposition ³
Investment	$72,782		$71,007		$84,728		$85,713		$85,342		$74,415
Number of properties	9		9		11		12		12		11
Total building square feet	429,167		429,167		567,252		577,390		577,390		519,424
Period end % occupied	41.9	%	41.9	%	36.0	%	38.7	%	39.1	%	35.7	%

TOTAL PROPERTIES
	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019		4Q 2018
Investment	$4,440,987		$4,272,083		$4,188,510		$4,098,622		$3,992,700		$3,910,817
Number of properties	212		204		204		201		201		199
Total building square feet	15,846,226		15,356,417		15,430,583		15,266,642		15,010,343		14,798,629
Period end % occupied	86.8	%	87.7	%	87.0	%	87.4	%	87.2	%	87.8	%


1	Excludes land held for development, construction in progress, Memphis Redevelopment, corporate property and assets classified as held for sale.


2	Acquisition includes properties acquired within the last 8 quarters of the period presented and are excluded from same store.


3	Reposition includes properties that meet any of the Company-defined criteria: properties having less than 60% occupancy that is expected to last at least two quarters; properties that experience a loss of occupancy over 30% in a single quarter; or properties with negative net operating income that is expected to last at least two quarters.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 20

Occupancy Reconciliation

SQUARE FEET



SEQUENTIAL
	PORTFOLIO								SAME STORE
	COUNT		OCCUPIED		TOTAL		%		COUNT		OCCUPIED		TOTAL		%
Beginning December 31, 2019	204		13,462,442		15,356,417		87.7	%	171		12,001,733		13,439,999		89.3	%
Portfolio activity
Acquisitions	7		308,685		338,778		91.1	%	NA		NA		NA		NA
Re/development completions	1		30,445		151,031		20.2	%	—		—		—		—	%
Dispositions ¹	—		—		—		—	%	—		—		—		—	%
Same store reclassifications
Acquisitions	NA		NA		NA		NA		—		—		—		—	%
Development completions	NA		NA		NA		NA		—		—		—		—	%
Reposition to same store	NA		NA		NA		NA		—		—		—		—	%
Reposition from same store	NA		NA		NA		NA		—		—		—		—	%
	212		13,801,572		15,846,226		87.1	%	171		12,001,733		13,439,999		89.3	%
Leasing activity
New leases/expansions	NA		115,665		NA		NA		NA		85,098		NA		NA
Move-outs/contractions	NA		(164,698	)	NA		NA		NA		(130,823	)	NA		NA
Net absorption	NA		(49,033	)	NA		NA		NA		(45,725	)	NA		NA
Ending March 31, 2020	212		13,752,539		15,846,226		86.8	%	171		11,956,008		13,439,999		89.0	%

YEAR-OVER-YEAR
	PORTFOLIO								SAME STORE
	COUNT		OCCUPIED		TOTAL		%		COUNT		OCCUPIED		TOTAL		%
Beginning March 31, 2019	201		13,093,955		15,010,343		87.2	%	164		11,325,522		12,684,444		89.3	%
Portfolio activity
Acquisitions	21		911,894		1,012,770		90.0	%	NA		NA		NA		NA
Re/development completions	1		62,447		191,309		32.6	%	—		32,002		40,278		79.5	%
Dispositions ¹	(11	)	(244,413	)	(368,196	)	66.4	%	(8	)	(209,719	)	(219,973	)	95.3	%
Same store reclassifications
Acquisitions	NA		NA		NA		NA		14		810,159		835,293		97.0	%
Development completions	NA		NA		NA		NA		1		41,790		99,957		41.8	%
Reposition to same store	NA		NA		NA		NA		—		—		—		—	%
Reposition from same store	NA		NA		NA		NA		—		—		—		—	%
	212		13,823,883		15,846,226		87.2	%	171		11,999,754		13,439,999		89.3	%
Leasing activity
New leases/expansions	NA		499,514		NA		NA		NA		395,004		NA		NA
Move-outs/contractions	NA		(570,858	)	NA		NA		NA		(438,750	)	NA		NA
Net absorption	NA		(71,344	)	NA		NA		NA		(43,746	)	NA		NA
Ending March 31, 2020	212		13,752,539		15,846,226		86.8	%	171		11,956,008		13,439,999		89.0	%


1	Includes properties reclassified as held for sale.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 21

Same Store Leasing Statistics¹




	1Q 2020		4Q 2019		3Q 2019		2Q 2019		1Q 2019		4Q 2018		3Q 2018		2Q 2018
Average in-place contractual increases
Multi-tenant	2.89	%	2.90	%	2.93	%	2.91	%	2.91	%	2.91	%	2.88	%	2.84	%
Single-tenant	2.10	%	2.10	%	2.12	%	2.43	%	2.46	%	2.45	%	2.42	%	2.13	%
	2.79	%	2.80	%	2.82	%	2.84	%	2.85	%	2.84	%	2.82	%	2.73	%
Multi-tenant renewals
Cash leasing spreads	4.4	%	4.2	%	3.3	%	5.0	%	3.3	%	(0.5	%)	3.8	%	6.4	%
Tenant retention rate	84.0	%	86.6	%	90.2	%	87.4	%	85.5	%	82.6	%	87.0	%	84.4	%



AVERAGE IN-PLACE CONTRACTUAL INCREASES ²
	MULTI-TENANT				SINGLE-TENANT				TOTAL
	% INCREASE		% OF BASE RENT		% INCREASE		% OF BASE RENT		% INCREASE		% OF BASE RENT
Annual increase
CPI	2.42	%	2.47	%	1.87	%	49.77	%	2.01	%	8.48	%
Fixed	2.99	%	93.20	%	2.65	%	20.71	%	2.98	%	83.99	%
Non-annual increase (annualized)
CPI	1.85	%	0.71	%	0.50	%	2.61	%	1.38	%	0.95	%
Fixed	1.31	%	2.53	%	2.25	%	26.91	%	1.88	%	5.63	%
No increase
Term > 1 year	—	%	1.09	%	—	%	—	%	—	%	0.95	%
Total ²	2.89	%	100.00	%	2.10	%	100.00	%	2.79	%	100.00	%



TYPE AND OWNERSHIP STRUCTURE (% OF SQUARE FEET)
	MULTI-TENANT		SINGLE-TENANT		TOTAL
Tenant type
Hospital	51.1	%	88.5	%	54.8	%
Physician and other	48.9	%	11.5	%	45.2	%

Lease structure
Gross	12.1	%	—	%	10.9	%
Modified gross	28.8	%	—	%	25.9	%
Net	59.1	%	—	%	53.1	%
Absolute net ³	—	%	100.0	%	10.1	%

Ownership type
Ground lease	63.9	%	10.5	%	59.2	%
Fee simple	36.1	%	89.5	%	40.8	%


1	Excludes recently acquired or disposed properties, construction in progress, Memphis Redevelopment, land held for development, corporate property, reposition properties and assets classified as held for sale.


2	Excludes leases with terms of one year or less.


3	Tenant is typically responsible for operating expenses and capital obligations.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 22

Same Store Performance ¹

DOLLARS IN THOUSANDS, EXCEPT PER SQUARE FOOT DATA




	TTM 2020		1Q 2020		4Q 2019		3Q 2019		2Q 2019		TTM 2019		1Q 2019		4Q 2018		3Q 2018		2Q 2018
Multi-tenant
Revenues	$386,081		$97,479		$96,403		$96,662		$95,537		$376,432		$94,391		$94,671		$94,713		$92,657
Expenses	155,637		39,498		38,354		39,612		38,173		151,752		37,640		37,950		39,026		37,136
Cash NOI	$230,444		$57,981		$58,049		$57,050		$57,364		$224,680		$56,751		$56,721		$55,687		$55,521
Revenue per occ SF ²	$35.79		$36.16		$35.73		$35.79		$35.39		$34.82		$34.94		$34.96		$35.00		$34.30
Margin	59.7	%	59.5	%	60.2	%	59.0	%	60.0	%	59.7	%	60.1	%	59.9	%	58.8	%	59.9	%
Average occupancy	88.1	%	88.1	%	88.2	%	88.2	%	88.2	%	88.3	%	88.3	%	88.5	%	88.4	%	88.3	%
Number of properties	157		157		157		157		157		157		157		157		157		157
Single-tenant
Revenues	$44,077		$11,064		$11,026		$11,019		$10,968		$42,535		$10,670		$10,635		$10,652		$10,578
Expenses	2,467		615		601		643		608		1,643		399		381		429		434
Cash NOI	$41,610		$10,449		$10,425		$10,376		$10,360		$40,892		$10,271		$10,254		$10,223		$10,144
Revenue per occ SF ²	$36.82		$36.97		$36.85		$36.82		$36.65		$35.59		$35.66		$35.54		$35.60		$35.53
Average occupancy	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	99.8	%	100.0	%	100.0	%	100.0	%	99.5	%
Number of properties	14		14		14		14		14		14		14		14		14		14
Total
Revenues	$430,158		$108,543		$107,429		$107,681		$106,505		$418,967		$105,061		$105,306		$105,365		$103,235
Expenses	158,104		40,113		38,955		40,255		38,781		153,395		38,039		38,331		39,455		37,570
Cash NOI	$272,054		$68,430		$68,474		$67,426		$67,724		$265,572		$67,022		$66,975		$65,910		$65,665
Revenue per occ SF ²	$35.89		$36.24		$35.84		$35.89		$35.51		$34.90		$35.01		$35.01		$35.06		$34.42
Margin	63.2	%	63.0	%	63.7	%	62.6	%	63.6	%	63.4	%	63.8	%	63.6	%	62.6	%	63.6	%
Average occupancy	89.2	%	89.1	%	89.2	%	89.3	%	89.3	%	89.3	%	89.3	%	89.5	%	89.4	%	89.3	%
Number of properties	171		171		171		171		171		171		171		171		171		171



SAME STORE GROWTH
	YEAR-OVER-YEAR
	TTM 2020		1Q 2020		4Q 2019		3Q 2019		2Q 2019
Multi-tenant
Revenue per occ SF ²	2.8	%	3.5	%	2.2	%	2.2	%	3.2	%
Avg occupancy (bps)	-20		-20		-30		-20		-10
Revenues	2.6	%	3.3	%	1.8	%	2.1	%	3.1	%
Expenses	2.6	%	4.9	%	1.1	%	1.5	%	2.8	%
Cash NOI	2.6	%	2.2	%	2.3	%	2.4	%	3.3	%
Single-tenant
Cash NOI	1.8	%	1.7	%	1.7	%	1.5	%	2.1	%
Total
Revenues	2.7	%	3.3	%	2.0	%	2.2	%	3.2	%
Cash NOI	2.4	%	2.1	%	2.2	%	2.3	%	3.1	%


1	Excludes recently acquired or disposed properties, development completions, construction in progress, Memphis Redevelopment, land held for development, corporate property, reposition properties and assets classified as held for sale.


2	Revenue per occ SF is calculated by dividing revenue by the average of the occupied SF for the period provided. Quarterly revenue per occ SF is annualized.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 23

NOI Reconciliations

DOLLARS IN THOUSANDS



BOTTOM UP RECONCILIATION
	1Q 2020			4Q 2019			3Q 2019			2Q 2019			1Q 2019			4Q 2018			3Q 2018			2Q 2018
Net income		$4,315			$27,210			$2,601			$4,484			$4,891			$16,314			$6,548			$37,729
Other income (expense)	13,927			(6,218		)	13,981			15,354			13,564			2,850			12,135			(16,559		)
General and administrative expense	8,766			7,669			10,802			7,845			8,510			8,534			8,504			8,373
Depreciation and amortization expense	47,497			46,134			45,137			43,926			42,662			42,437			42,061			40,130
Other expenses ¹	3,365			2,200			2,079			1,965			1,768			1,693			1,457			1,540
Straight-line rent expense	375			378			383			387			391			394			398			399
Straight-line rent revenue	(1,043		)	(1,167		)	(770		)	(395		)	(668		)	(682		)	(802		)	(1,074		)
Other revenue ²	(2,004		)	(1,430		)	(1,726		)	(1,447		)	(1,468		)	(1,523		)	(1,288		)	(1,382		)
Cash NOI		$75,198			$74,776			$72,487			$72,119			$69,650			$70,017			$69,013			$69,156
Acquisitions/development completions	(6,489		)	(5,632		)	(4,013		)	(3,154		)	(1,287		)	(1,067		)	(1,089		)	(400		)
Dispositions/other	(40		)	(433		)	(819		)	(885		)	(1,074		)	(1,756		)	(1,634		)	(2,625		)
Same store cash NOI and reposition	68,669			68,711			67,655			68,080			67,289			67,194			66,290			66,131
Reposition	(239		)	(237		)	(229		)	(356		)	(267		)	(219		)	(380		)	(466		)
Same store cash NOI		$68,430			$68,474			$67,426			$67,724			$67,022			$66,975			$65,910			$65,665

TOP DOWN RECONCILIATION
	1Q 2020			4Q 2019			3Q 2019			2Q 2019			1Q 2019			4Q 2018			3Q 2018			2Q 2018
Property operating before rent concessions		$112,022			$108,029			$106,319			$103,245			$99,607			$99,877			$99,976			$97,185
Rent concessions	(874		)	(493		)	(514		)	(427		)	(625		)	(700		)	(609		)	(766		)
Property operating	111,148			107,536			105,805			102,818			98,982			99,177			99,367			96,419
Single-tenant net lease	10,453			10,735			11,165			11,138			11,046			11,290			11,283			12,073
Straight-line rent revenue	1,043			1,167			770			395			668			682			802			1,074
Rental income	122,644			119,438			117,740			114,351			110,696			111,149			111,452			109,566
Property lease guaranty income	—			—			—			—			128			187			168			146
Parking income	2,051			1,982			1,935			1,870			1,734			1,733			1,752			1,819
Exclude straight-line rent revenue	(1,043		)	(1,167		)	(770		)	(395		)	(668		)	(682		)	(802		)	(1,074		)
Exclude other non-cash revenue ³	(1,892		)	(1,326		)	(1,601		)	(1,350		)	(1,369		)	(1,423		)	(1,198		)	(1,279		)
Revenue	121,760			118,927			117,304			114,476			110,521			110,964			111,372			109,178
Property operating expense	(49,552		)	(46,214		)	(46,777		)	(44,286		)	(42,725		)	(42,815		)	(44,135		)	(41,737		)
Exclude non-cash expenses ⁴	2,990			2,063			1,960			1,929			1,854			1,868			1,776			1,715
Cash NOI		$75,198			$74,776			$72,487			$72,119			$69,650			$70,017			$69,013			$69,156
Acquisitions/development completions	(6,489		)	(5,632		)	(4,013		)	(3,154		)	(1,287		)	(1,067		)	(1,089		)	(400		)
Dispositions/other	(40		)	(433		)	(819		)	(885		)	(1,074		)	(1,756		)	(1,634		)	(2,625		)
Same store cash NOI and reposition	68,669			68,711			67,655			68,080			67,289			67,194			66,290			66,131
Reposition	(239		)	(237		)	(229		)	(356		)	(267		)	(219		)	(380		)	(466		)
Same store cash NOI		$68,430			$68,474			$67,426			$67,724			$67,022			$66,975			$65,910			$65,665


1	Includes acquisition and pursuit costs, bad debt, above and below market ground lease intangible amortization, and leasing commission amortization.


2	Includes management fee income, interest, above and below market lease intangible amortization, lease inducement amortization, lease termination fees and tenant improvement overage amortization.


3	Includes above and below market lease intangibles, lease inducements, lease termination fees and TI amortization.


4	Includes above and below market ground lease intangible amortization, leasing commission amortization, and ground lease straight-line rent.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 24

NOI Reconciliations

DOLLARS IN THOUSANDS



RECONCILIATION OF TTM ENDED 3/31/2020 - CASH NOI
	TTM 2020		TTM 2019		% CHANGE
Same store cash NOI		$272,054		$265,572	2.4	%
Reposition	1,061		1,332		(20.3	%)
		$273,115		$266,904	2.3	%
Acquisitions/development completions	19,288		3,843		402.0	%
Dispositions/other	2,177		7,089		(69.3	%)
Cash NOI		$294,580		$277,836	6.0	%



RECONCILIATION OF NOI TO FFO AND NORMALIZED FFO
	1Q 2020			4Q 2019			3Q 2019			2Q 2019			1Q 2019			4Q 2018			3Q 2018			2Q 2018
Cash NOI		$75,198			$74,776			$72,487			$72,119			$69,650			$70,017			$69,013			$69,156
General and administrative expense	(8,766		)	(7,669		)	(10,802		)	(7,845		)	(8,510		)	(8,534		)	(8,504		)	(8,373		)
Straight-line rent	1,043			1,167			770			395			668			682			802			1,074
Interest and other income (expense), net	82			5			—			(743		)	9			(35		)	41			38
Management fees and other income	112			103			124			96			99			99			90			103
Bad debts, net of recoveries	—			—			—			—			—			(18		)	62			(104		)
Other non-cash revenue ¹	1,892			1,326			1,601			1,350			1,369			1,423			1,198			1,279
Other non-cash expenses ²	(2,990		)	(2,063		)	(1,960		)	(1,929		)	(1,854		)	(1,868		)	(1,776		)	(1,715		)
Debt Covenant EBITDA		$66,571			$67,645			$62,220			$63,443			$61,431			$61,766			$60,926			$61,458
Interest expense	(13,960		)	(13,816		)	(14,181		)	(13,850		)	(13,588		)	(13,602		)	(13,464		)	(13,069		)
Acquisition and pursuit costs	(750		)	(515		)	(501		)	(422		)	(305		)	(200		)	(141		)	(120		)
Leasing commission amortization ³	1,893			1,667			1,547			1,505			1,404			1,415			1,319			1,258
Depreciation expense of unconsolidated JVs ⁴	80			80			80			80			80			80			80			80
Lease intangible amortization ⁵	—			—			—			—			—			238			108			108
Non-real estate depreciation and amortization	(859		)	(838		)	(838		)	(829		)	(763		)	(790		)	(845		)	(829		)
FFO		$52,975			$54,223			$48,327			$49,927			$48,259			$48,907			$47,983			$48,886
Acquisition and pursuit costs	750			515			501			422			305			200			141			120
Lease intangible amortization	745			4			5			54			84			—			—			—
Accelerated amortization of restricted stock awards⁶	—			—			2,854			—			—			—			70			—
Debt financing costs	—			—			—			760			—			—			—			—
Normalized FFO		$54,470			$54,742			$51,687			$51,163			$48,648			$49,107			$48,194			$49,006


1	Includes above and below market lease intangibles, lease inducements, lease termination fees and TI amortization.


2	Includes above and below market ground lease intangible amortization, leasing commission amortization, and ground lease straight-line rent.


3	Leasing commission amortization is included in the real estate depreciation and amortization add back for FFO.


4	The Company has two unconsolidated joint ventures whose earnings are recorded in Interest and other income (expense), net on the Condensed Consolidated Statements of Income. The depreciation expense incurred related to these properties is included in real estate deprecation and amortization add back for FFO.


5	Includes above and below market ground lease intangible amortization, leasing commission amortization, and ground lease straight-line rent.


6	The Company's former Executive Chairman, David R. Emery, died on September 30, 2019 resulting in $2.9 million of expenses associated with the acceleration of his outstanding non-vested share-based awards. The third quarter of 2018 includes a revaluation adjustment recorded in connection with an officer retirement.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 25

EBITDA Reconciliations

DOLLARS IN THOUSANDS



RECONCILIATION OF EBITDA
	TTM			1Q 2020		4Q 2019			3Q 2019			2Q 2019
Net income		$38,610			$4,315		$27,210			$2,601			$4,484
Interest expense	55,807			13,960		13,816			14,181			13,850
Depreciation and amortization	182,694			47,497		46,134			45,137			43,926
EBITDA		$277,111			$65,772		$87,160			$61,919			$62,260
Other amortization ¹	6,933			1,973		1,747			1,628			1,585
Gain on sales of real estate properties	(25,036		)	49		(20,036		)	(200		)	(4,849		)
Impairments on real estate assets	5,617			—		7			—			5,610
EBITDAre ²		$264,625			$67,794		$68,878			$63,347			$64,606

EBITDA		$277,111			$65,772		$87,160			$61,919			$62,260
Acquisition and pursuit costs	2,188			750		515			501			422
Gain on sales of real estate properties	(25,036		)	49		(20,036		)	(200		)	(4,849		)
Impairments on real estate assets	5,617			—		7			—			5,610
Debt Covenant EBITDA		$259,880			$66,571		$67,646			$62,220			$63,443
Other amortization¹	6,933			1,973		1,747			1,628			1,585
Lease intangible amortization	808			745		4			5			54
Timing impact ³	3,012			737		349			902			1,024
Stock based compensation	12,234			2,598		2,133			5,131			2,372
Adjusted EBITDA		$282,867			$72,624		$71,879			$69,886			$68,478


1	Includes leasing commission amortization and depreciation expense of unconsolidated JVs.


2	Earnings before interest, taxes, depreciation and amortization for real estate ("EBITDAre") is an operating performance measure adopted by NAREIT. NAREIT defines EBITDAre equal to “net income (computed in accordance with GAAP) plus interest expense, income tax expense, depreciation and amortization, impairments and minus gains on the disposition of depreciated property.”


3	Adjusted to reflect quarterly EBITDA from properties acquired or disposed in the quarter.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 26

Components of Net Asset Value

DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA



CASH NOI BY PROPERTY TYPE
	1Q 2020
ASSET TYPE	SAME STORE ¹		ACQ./DEV. COMPLETIONS ²		REPOSITION ³		TIMING ADJUSTMENTS ⁴		ADJUSTED CASH NOI		ANNUALIZED ADJUSTED NOI		% OF ADJUSTED NOI
MOB/outpatient		$61,925		$6,178		$465		$2,236		$70,804		$283,216	91.1	%
Inpatient/Surgical	5,487		—		—		—		5,487		21,948		7.0	%
Office	1,018		439		—		—		1,457		5,828		1.9	%
Total Cash NOI		$68,430		$6,617		$465		$2,236		$77,748		$310,992	100.0	%



DEVELOPMENT PROPERTIES			TOTAL SHARES OUTSTANDING
Land held for development		$24,647	As of May 1, 2020			134,932,261
Memphis Redevelopment	10,169
Construction in progress	—
		$34,816

OTHER ASSETS
Reposition properties (net book value) ³	8,594
Cash and other assets ⁵	210,965
		$219,559

DEBT			IMPLIED CAP RATE
Unsecured credit facility		$215,000		STOCK PRICE		IMPLIED CAP RATE
Unsecured term loan	200,000		As of 5/1/20		$27.97	5.92	%
Senior notes	1,100,000
Mortgage notes payable	141,325		1Q 2020 high		$37.92	4.72	%
Other liabilities ⁶	76,279		1Q 2020 low		$24.72	6.46	%
		$1,732,604


1	See Same Store Performance schedule on page 23 for details on same store NOI.


2	Adjusted to reflect quarterly NOI from properties acquired or stabilized developments completed during the full eight quarter period that are not included in same store NOI.

Reposition properties includes 9 properties which comprise 429,167 square feet. The NOI table above includes 7 of these properties comprising 321,556 square feet that have generated positive NOI totaling approximately $0.5 million. The remaining 2 properties, comprising 107,611 square feet, have generated negative NOI of approximately $0.2 million and are reflected at a net book value of $8.6 million in the other assets table above.


4	Timing adjustments include current quarter acquisitions as well as a development conversion adjustment of $2.2 million to reflect full quarterly stabilized NOI from a recently completed development.


5	Includes cash of $103.4 million, prepaid assets of $56.3 million, accounts receivable of $14.6 million, and prepaid ground leases of $24.8 million. In addition, includes the Company's occupied portion of its corporate headquarters of $11.9 million.


6	Includes only liabilities that are expected to reduce future cash or NOI and that are currently producing non-cash benefits to NOI. Included are accounts payable and accrued liabilities of $64.6 million, security deposits of $8.9 million, and deferred operating expense reimbursements of $2.8 million.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 27

Components of Expected FFO

DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA

The Company provided its expectations for the full year of 2020 in February. These expectations have been revised to reflect the estimated impact of the COVID-19 pandemic.



SAME STORE RANGE OF 2020 EXPECTATIONS
	PRE COVID-19				ACTUAL		COVID-19 ADJUSTED ¹
	LOW		HIGH		Q1 2020		LOW		HIGH
TTM Average Occupancy
Multi-tenant	88.0	%	89.0	%	88.1	%	87.0	%	88.0	%
Single-tenant	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
TTM revenue per occupied square foot
Multi-tenant	$35.50		$36.50		$35.79		$35.50		$36.50
Single-tenant	$36.75		$37.50		$36.82		$36.75		$37.50
TTM Multi-tenant cash NOI margin	59.5	%	60.5	%	59.7	%	59.5	%	60.0	%
Multi-tenant cash leasing spreads	3.0	%	4.0	%	4.4	%	—	%	3.0	%
Multi-tenant lease retention rate	75.0	%	90.0	%	84.0	%	75.0	%	90.0	%
TTM cash NOI growth
Multi-tenant	2.4	%	3.3	%	2.6	%	2.1	%	2.7	%
Single-tenant	1.7	%	2.5	%	1.8	%	1.7	%	2.5	%
Total	2.3	%	3.2	%	2.4	%	2.0	%	2.7	%

ANNUAL RANGE OF 2020 EXPECTATIONS
	LOW		HIGH		2020		LOW		HIGH
Normalized G&A	$33,000		$34,000		$8,766		$32,000		$33,000
Straight-line rent, net ²	1,500		3,000		660		1,500		3,000
Funding activity
Acquisitions	250,000		350,000		102,030		102,030		300,000
Dispositions	(25,000)		(75,000)		—		—		(100,000)
Re/development	30,000		50,000		6,916		30,000		45,000
1st generation TI and acq. cap. ex.	20,000		25,000		2,731		18,000		23,000
2nd generation TI	28,000		34,000		6,040		26,000		32,000
Leasing commissions paid	8,000		12,000		2,824		7,000		11,000
Capital expenditures	17,000		21,000		3,470		15,000		20,000
Cash yield
Acquisitions	5.0	%	5.8	%	5.8	%	5.0	%	5.8	%
Dispositions	5.5	%	6.5	%	—	%	5.0	%	7.0	%
Re/development (stabilized)	6.0	%	7.5	%	NA		6.0	%	7.5	%
Leverage (debt/cap)	31.5	%	33.5	%	35.7	%	32.0	%	36.0	%
Net debt to adjusted EBITDA	5.0x		5.5x		5.3x		5.0x		5.5x

COVID-19 Adjusted represents the Company's estimate of full year 2020 results. The ultimate rent deferral accounting method selected could impact quarterly TTM results for the second and third quarters of 2020. The current COVID-19 rent deferral agreements provide for the repayment of deferral amounts before year-end of 2020, and as such the accounting method, when selected, is not expected to impact the full year 2020 results.


2	This guidance range is based on current in-place leases. Straight-line rent, net was $1.4 million for the year ended December 31, 2019, with a quarterly range of $0.0 million to $0.8 million.




HEALTHCARE REALTY	1Q 2020 SUPPLEMENTAL INFORMATION 28

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