LTC Properties (LTC) risk factors, FY2025 10-K

Risks Related to Our Business and Industry

1. 01We are responsible for, and our financial performance will be impacted by, operational and legal risks and liabilities under our new SHOP segmentNew
2. 02We are dependent on the ability of our third- party SHOP operators to successfully manage and operate our SHOP communitiesNew
3. 03We are dependent on our operators for revenue and cash flow29% rewritten
4. 04We and our operators are subject to risks associated with public health crises, including pandemics
5. 05The health care industry is heavily regulated by the government and changes in federal, state, or local law could impose negative costs and restrictions on us and our operators53% rewritten
6. 06Changes in federal, state, or local laws limiting REIT investments in the health care sector may adversely impact our ability to participate in the ownership of and investment in health care real estateNew
7. 07Federal and state health care cost containment measures including reductions in reimbursement from third-party payors such as Medicare and Medicaid could adversely affect us and the ability of our operators to make payments to us
8. 08Required regulatory approvals could delay operation of health care facilities
9. 09Failure to comply with applicable law or regulations could prohibit operation of health care facilities45% rewritten
10. 10Insurance coverage maintained by our operators could be inadequate to protect against contingencies30% rewritten
11. 11We rely on a few major operators24% rewritten
12. 12The extent and pace of inflation could adversely impact our operators’ net income and our results of operations
13. 13We may be unable to find suitable replacement operators for our SHOP communitiesNew
14. 14We may be unable to renew leases, or the terms of renewals or new leases could be less favorable than current leases
15. 15Operator financial or legal difficulties could delay or prevent collection of rent
16. 16Collateral securing mortgage loans could be insufficient
17. 17Our real estate investments could become impaired
18. 18Our real estate investments are relatively illiquid and could be difficult to sell for book value
19. 19Development and construction risks could affect the profitability and completion of properties
20. 20We may be unable to invest cash proceeds due to competition for health care properties
21. 21Our operators face competition providing seniors housing and health care services

Risks Related to Our Status as a REIT

1. 22Our failure to qualify as a REIT would have serious adverse consequences to our stockholders
2. 23stockholders would be significantly reduced for each of the years involved. In addition, we would no longer be required to make distributions to stockholders

Risks Related to Our Capital Structure

1. 24Limited access to capital could affect our growth
2. 25We could incur more debt21% rewritten
3. 26Covenants related to our indebtedness could limit our operations
4. 27An increase in market interest rates could increase our debt cost and impact our stock price
5. 28Ownership through partnerships and joint ventures could limit property performance

Risks Related to Our Stock

1. 29A failure to maintain or increase our dividend could reduce the market price of our common stock
2. 30Your ownership percentage in our common stock could be diluted
3. 31Provisions in our charter limit ownership of shares of our stock
4. 32Maryland law could increase the difficulty of acquiring us
5. 33We are dependent on key personnel
6. 34Our investments are concentrated in a single sector
7. 35Disruptions in the capital markets could affect the price of our common stock and our ability to obtain financing
8. 36Catastrophic weather and natural disasters could affect our properties
9. 37We could incur costs associated with hazardous substances and contamination
10. 38The use of, or inability to take advantage of the benefits of, artificial intelligence by us or our operators presents risks and challengesNew
11. 39Information systems failures or data breaches could harm our business
12. 40Data privacy security failures or breaches could expose us to regulatory and other liability