Sabra Health Care REIT, Inc. (SBRA): PESTLE Analysis [Nov-2025 Updated]

You're holding Sabra Health Care REIT, Inc. (SBRA) in your portfolio, so you need to know exactly where the risks and opportunities lie in 2025. The core challenge is a political and economic squeeze: Medicare/Medicaid still drives over 70% of Skilled Nursing Facility (SNF) revenue while high interest rates, likely above 5.0%, and inflation near 3.5% pressure operator margins. But honestly, the demographic tailwind is powerful-the 65+ population is growing by an estimated 3% annually, pushing occupancy to stabilize above 80%-plus, technology like telehealth is helping mitigate the critical labor shortages. We'll map out how regulatory scrutiny, rising litigation, and the growing demand for ESG reporting defintely shape the investment thesis right now, giving you clear actions for your next move.

Sabra Health Care REIT, Inc. (SBRA) - PESTLE Analysis: Political factors

The political landscape for Skilled Nursing Facilities (SNFs), which are a core part of Sabra Health Care REIT, Inc.'s portfolio, is defined by tight government control over revenue and a volatile regulatory environment. This isn't about grand geopolitical strategy; it's about the Centers for Medicare & Medicaid Services (CMS) and state legislatures setting the rules for how much money comes in and what it costs to operate.

You need to focus on two main forces: the fixed nature of government reimbursement and the shifting sands of compliance mandates. The political decisions made in Washington, D.C., and state capitals directly impact your tenants' ability to pay rent, so these aren't abstract risks-they're cash flow drivers.

Medicare/Medicaid reimbursement rates drive over 70% of Skilled Nursing Facility (SNF) revenue.

For the average SNF operator, not a Sabra Health Care REIT, Inc. tenant specifically, roughly 85 percent of their total revenue is derived from Medicare and Medicaid payor sources. This fact alone makes the sector fundamentally a regulated utility, not a free market business. So, any change in the federal or state budget process is a direct change to your tenants' top line.

For the federal fiscal year (FY) 2025, the Centers for Medicare & Medicaid Services (CMS) finalized an overall 4.2% net increase in Medicare Part A payments to SNFs. This reflects a $1.4 billion aggregate increase in Medicare spending for the sector compared to FY 2024. While this is a positive adjustment, it often barely keeps pace with the actual inflation in labor and supply costs, a reality that keeps operating margins thin.

Here is a quick look at the key 2025 Medicare rate components:

Medicaid, which covers the majority of long-term care residents, remains the bigger headwind. State-level Medicaid rates are notoriously low, often lagging up to 20% behind the actual cost of care, forcing operators to cross-subsidize with higher-margin Medicare revenue.

Federal minimum staffing mandate proposals increase operating cost pressure on operators.

The political risk of unfunded mandates was dramatically reduced in 2025. The Centers for Medicare & Medicaid Services' (CMS) proposed federal minimum staffing mandate, which would have required specific Hours Per Resident Day (HPRD) minimums, was struck down by a U.S. District Judge on April 7, 2025. This court decision blocked a policy that would have created a massive, immediate financial burden on operators.

The industry was facing an estimated annual cost increase of over $5 billion by CMS's own estimate, or closer to $6.5 billion according to the American Health Care Association (AHCA) analysis, to hire the necessary staff. The mandate's removal is a significant near-term political win for operators, effectively eliminating a major, uncompensated cost pressure that would have strained rent coverage ratios across the SNF sector.

State-level Certificate of Need (CON) laws restrict new facility development in key markets.

Certificate of Need (CON) laws are a political tool used in 35 states and D.C. to control healthcare supply. These laws require providers to prove a 'public need' before building a new facility, adding beds, or making major capital expenditures. This creates an artificial barrier to entry, which is a double-edged sword for Sabra Health Care REIT, Inc.

On one hand, CON laws protect existing facilities, including many owned by Sabra Health Care REIT, Inc., from new competition, preserving occupancy and cash flow. On the other hand, they stifle the development of modern, updated facilities that are needed to replace aging stock and attract higher-acuity, higher-reimbursement patients.

• North Carolina: Was on track for a near-total repeal of its CON laws by January 2025, signaling a potential increase in competition for new SNF development.
• New York: Adopted regulatory changes effective August 6, 2025, that significantly streamlined the CON process by raising cost thresholds for review (e.g., from $6 million to $8 million for certain facility types), easing the path for smaller capital improvements.

The political debate over CON laws is active, and any state-level repeal represents a long-term risk to the competitive moat of existing SNF assets.

Political focus on quality of care increases regulatory scrutiny and compliance costs.

The political focus on improving quality of care is a constant source of increased regulatory scrutiny. The federal government uses its payment mechanisms to enforce compliance, making it a financial matter for operators.

The FY 2025 final rule expanded the Centers for Medicare & Medicaid Services' (CMS) authority to impose additional financial penalties (Civil Monetary Penalties, or CMPs) on facilities with health and safety deficiencies. This means the financial risk of non-compliance is rising. Plus, the Value-Based Purchasing (VBP) program continues to pressure margins:

• CMS withholds 2% of Medicare Part A payments from all SNFs.
• The net reduction in payments from the SNF VBP adjustments for FY 2025 is estimated to total $196.5 million across the sector.

The clear action here is that operators must defintely increase their investment in compliance and quality assurance to avoid the rising financial penalties and maximize their VBP incentive payments.

Sabra Health Care REIT, Inc. (SBRA) - PESTLE Analysis: Economic factors

High interest rates (likely above 5.0% for the Fed Funds rate in late 2025) increase refinancing risk for operators.

The persistent high interest rate environment fundamentally shifts the cost of capital for Sabra Health Care REIT and its operators. While the Federal Reserve has been cutting rates, the Fed Funds rate remains elevated, with forecasts for the end of 2025 pointing to a target range of 3.75%-4.00% after a cut in October 2025. This is still a significant headwind for refinancing. The risk of future rates climbing back toward or above 5.0% remains a key concern for debt maturity schedules.

Sabra's own balance sheet management shows the direct impact. The company successfully refinanced some debt in the second quarter of 2025 at a rate of 4.04%, extending the maturity by five years. However, a substantial portion of its debt, including the $500 million of 5.125% senior unsecured notes, matures in August 2026, which keeps refinancing risk firmly on the near-term radar. The cost of capital for operators, who ultimately pay the rent, remains high, directly pressuring their ability to cover lease payments.

Persistent inflation (near 3.5%) elevates property insurance and utility expenses.

Inflation, while moderating, continues to be a major operational challenge for the Skilled Nursing Facility (SNF) and Senior Housing operators that lease from Sabra Health Care REIT. The Consumer Price Index (CPI) is projected to be around 3.0% to 3.1% in the fourth quarter of 2025, which is notably above the Federal Reserve's long-term 2% target.

This persistent inflation directly hits non-labor operating expenses, which are harder for operators to manage. For instance, freight and transportation costs, which factor into medical supply delivery, saw a 5.9% rate increase from carriers like FedEx and UPS for 2025. Property insurance premiums, in particular, have seen outsized increases due to rising replacement costs and increased climate risk, often growing at a pace far exceeding general inflation. This expense pressure compresses the operator's earnings before interest, taxes, depreciation, amortization, rent, and management fees (EBITDARM), which is the primary measure of their ability to cover rent.

Wage inflation for clinical staff continues to compress operator margins.

Labor costs are the single largest expense for SNF operators, and wage inflation for clinical staff remains a significant headwind despite some stabilization. A 2025 compensation survey projected a median base pay increase of 4.3% for healthcare staff in 2025, a jump from 2.7% in 2024. This is a direct result of ongoing labor market strains, particularly for frontline roles like clinical technicians, which saw a 5.5% pay increase.

This wage pressure is a double-edged sword: it is necessary to attract and retain staff, but it directly erodes the operator's margin. The Centers for Medicare & Medicaid Services (CMS) provided a 4.2% increase in Medicare Part A payments to SNFs for Fiscal Year 2025, which helps offset some of the cost, but the net effect is a continuous tight-rope walk for profitability. Sabra's SNF operators, however, maintained a solid EBITDARM-to-rent coverage of 2.3x as of the second quarter of 2025, which provides a buffer against these rising costs.

Occupancy recovery in SNFs is strong, projected to stabilize above 80% by year-end 2025.

The most positive economic trend for Sabra Health Care REIT is the continued recovery in Skilled Nursing Facility occupancy. The average nursing home occupancy rate grew to 80.5% toward the end of 2024, marking a recovery back toward pre-pandemic levels. This is a critical metric, as every percentage point of occupancy gain drives significant revenue growth for the operators.

For the 31 National Investment Center (NIC) MAP Primary Markets, the nursing care occupancy rate was even higher, reaching 84.5% in the third quarter of 2024, representing the fourteenth consecutive quarter of occupancy gains. This recovery is driven by a combination of strong demand from an aging population and a decline in the overall operational bed inventory due to facility closures. The improving occupancy, coupled with favorable reimbursement rate increases, is the key factor driving the financial improvement for Sabra's tenants, which is reflected in the company's improved Net Debt to Adjusted EBITDA ratio of 4.96x as of September 30, 2025.

Sabra Health Care REIT, Inc. (SBRA) - PESTLE Analysis: Social factors

The 65+ population is growing, increasing demand for senior housing and SNF beds by an estimated 3% annually.

You're looking at a fundamental demographic tailwind that defintely underpins Sabra Health Care REIT, Inc.'s entire business model: the aging of the Baby Boomer generation. As of 2025, approximately 62 million adults aged 65 and older make up about 18% of the total U.S. population. This cohort is driving a massive increase in demand for both private-pay senior housing and Skilled Nursing Facility (SNF) beds.

Here's the quick math on the market opportunity: the U.S. senior living market is valued at $119.55 billion in 2025 and is projected to grow to $158.93 billion by 2030, a Compound Annual Growth Rate (CAGR) of 5.86%. That growth rate is significantly higher than the general population increase, showing the accelerating need for specialized services. The real surge will come from the oldest segment-the population aged 80 and over is expected to increase by approximately 50% over the next 10 years, growing from 13.9 million to 20.8 million.

This demographic shift creates a clear, long-term opportunity, but it's still constrained by supply shortages, especially in the middle market. Experts estimate a need for 156,000 new senior living units by 2025, and current development is falling short.

Critical labor shortages, particularly for Registered Nurses (RNs), limit capacity and increase reliance on expensive contract labor.

The biggest near-term risk to Sabra's operators, and thus to its rent collections, is the persistent and expensive labor crisis. The demand for care staff is soaring, but the supply is not keeping up, which directly limits a facility's ability to fill beds and drives up operating costs for operators.

For the 2025 fiscal year, the healthcare sector is grappling with significant staffing gaps. The national Registered Nurse (RN) vacancy rate is elevated at 9.6%. This shortage is particularly acute in the long-term care segment, where Skilled Nursing Facilities (SNFs) are still operating with a deficit of over 100,000 workers compared to pre-pandemic levels.

To fill these gaps, operators are forced to rely on expensive contract labor (travel nurses), which compresses margins. The cost of replacing a single bedside RN due to turnover is substantial, averaging $61,110, an 8.6% annual increase. Plus, turnover rates for healthcare support staff in SNFs have been reported as high as 82% annually. That's a brutal cycle of hiring, training, and losing staff.

Consumer preference shifts toward private-pay senior housing over traditional institutional settings.

The market is clearly shifting away from the traditional institutional model, which is a structural headwind for Sabra's SNF portfolio but a tailwind for its Senior Housing Operating Portfolio (SHOP) assets. The Baby Boomer generation is demanding a lifestyle product, not just a care facility.

A recent poll showed that only 1% of older adults most prefer to move into a nursing home for long-term care, compared to 6% for assisted living. The overwhelming preference, cited by 73% of respondents, is to receive care in their own home or a family member's home. This preference drives demand to the private-pay senior housing segment, which offers a more hospitality-focused environment.

The senior housing sector is benefiting from this trend, with the average occupancy rate for U.S. senior housing climbing to 87.4% in the first quarter of 2025-the highest level since early 2020. Operators are leveraging this demand to push rents and curb concessions. The key takeaway here is that the market is rewarding communities that offer a blend of independence, amenities, and specialized care, like Assisted Living and Independent Living, over the traditional, purely clinical Skilled Nursing model.

Public perception of post-pandemic care quality remains a key reputational factor.

The pandemic cast a long, dark shadow over the Skilled Nursing sector, and that reputational damage has not fully healed by 2025. This negative public perception is a social factor that directly impacts occupancy and the political will for favorable reimbursement.

A 2025 poll revealed that 59% of older adults have a mostly negative impression of nursing homes, while only 13% hold a mostly favorable impression. This lack of confidence is a significant barrier to entry for potential residents and their families. The industry is trying to counter this by focusing on quality and transparency.

The reputational risk is compounded by ongoing concerns about quality of care and clinical oversight, which is a direct consequence of the labor shortages. The industry must focus on improving public perception by addressing core issues:

• Boosting staffing levels to improve care consistency.
• Increasing clinical oversight, as many facilities lack adequate medical director presence.
• Managing the lasting effects of the pandemic, such as the increased use of psychotropic medications among residents.

For Sabra, this means its operators must invest aggressively in quality and patient experience to overcome the negative social stigma associated with the institutional care setting. It's a fight for consumer trust, and the SNF sector is defintely starting from a deficit.

Sabra Health Care REIT, Inc. (SBRA) - PESTLE Analysis: Technological factors

The technology landscape for Sabra Health Care REIT, Inc. (SBRA) is a classic two-sided coin: it's the primary engine for operational efficiency and care quality, but also a source of significant capital expense and rising compliance risk. The near-term focus for your operators, especially in the skilled nursing facilities (SNFs), is on digital adoption to combat the severe labor shortage, plus the unavoidable capital outlay for facility-level infrastructure upgrades.

You need to see technology not just as an expense, but as a critical lever for improving the cash flow coverage of your tenants. The challenge is balancing the high initial investment against the long-term gains in efficiency and reduced regulatory risk. It's a cost you can't defintely avoid.

Increased adoption of Electronic Health Records (EHR) and digital platforms streamlines compliance and billing.

The move to Electronic Health Records (EHR) systems and digital platforms is past the point of being optional for your tenants. While EHR adoption across long-term care facilities, which includes many of Sabra Health Care REIT's assets, is around 60%, the real opportunity is in interoperability and deep use. Only about 18% of skilled nursing facilities can electronically exchange health information seamlessly with other providers, which creates workflow bottlenecks and data silos that hurt care coordination.

The payoff is clear: automated EHRs can cut staff documentation and administrative work by 30-40%, freeing up clinicians to focus on direct resident care. This efficiency gain translates directly into better staffing ratios and lower labor costs for your operators. EHR implementation also leads to 86% faster access to patient records, which is crucial for quick decision-making and preventing errors. Nearly 60% of skilled nursing providers plan to add technology specifically to improve profitability.

Here's a quick look at the efficiency opportunity your operators are chasing:

• Accelerate patient record access by 86%.
• Reduce administrative documentation time by 30-40%.
• Improve audit-ready documentation accuracy to 98-99%.
• Save up to $5 billion annually across the U.S. healthcare sector from EHR adoption.

Telehealth integration helps mitigate staffing shortages and improves remote patient monitoring.

The U.S. nursing shortage is a major operational risk, projected to reach a deficit of over 500,000 registered nurses in 2025. Telehealth is one of the most effective tools to mitigate this, especially in the skilled nursing and post-acute care settings that make up a large part of Sabra Health Care REIT's portfolio. Telehealth allows a smaller pool of specialists and nurses to cover more patients across multiple facilities, effectively extending the reach of your operators' existing staff.

Approximately 25% of nurses now spend a significant portion of their time in telehealth roles, which helps alleviate the strain on the bedside workforce. This virtual care model also improves patient outcomes, especially by reducing unnecessary transfers. Telehealth saves between $19 and $121 per visit by diverting patients from expensive emergency departments, a direct financial benefit to your tenants under value-based care models. For a company whose portfolio includes 217 skilled nursing/transitional care facilities as of Q3 2025, this technology is a core defense against the fact that nearly 75% of nursing homes face staffing shortages.

Capital expenditure on facility modernization (e.g., HVAC, air filtration) is necessary but costly.

Beyond digital systems, the physical plant requires significant capital expenditure (CapEx) to meet modern health standards, especially post-pandemic. Upgrading Heating, Ventilation, and Air Conditioning (HVAC) systems and air filtration is a non-negotiable cost for infection control and resident safety. The global hospital HVAC system market was valued at $5.6 billion in 2024 and is expected to grow at a Compound Annual Growth Rate (CAGR) of 7.2% through 2030, reflecting the intense focus on this area.

For Sabra Health Care REIT, this translates into direct and mandated spending. Your regular maintenance CapEx averages $1.5 million to $2 million per quarter. Furthermore, as of late 2024, the company had an aggregate commitment of approximately $16 million for future capital and other expenditures associated with facilities leased under triple-net operating leases. This money is largely directed toward maintaining the physical integrity and modernization of your assets, which is a crucial factor in tenant retention and regulatory compliance.

Data security and HIPAA compliance risks are rising with increased digitalization.

The greater the push toward digital records and telehealth, the higher the risk of a catastrophic data breach. Healthcare is the costliest sector for a data breach, and the risk is accelerating. The average cost of a healthcare data breach is a staggering $9.8 million for 2024-2025, which is 2.5 times the global cross-industry average.

This risk is existential for your operators and a reputation risk for Sabra Health Care REIT. The value of the stolen data is immense: medical records sell for a 10x premium over credit card numbers, trading at $260-$310 per record. The sheer volume of exposed data is alarming, with 276 million Americans having their health data exposed in 2024. This necessitates continuous investment in security infrastructure, compliance automation, and staff training to adhere to the Health Insurance Portability and Accountability Act (HIPAA) (a federal law that protects sensitive patient health information). Failure to comply can result in HIPAA penalties of up to $1.9 million per violation.

The table below summarizes the core technological risks and costs for your operators:

Next Step: Operations team: Request a detailed breakdown of 2025 CapEx spending by asset type, specifically flagging the percentage allocated to IT security and HVAC/air quality upgrades to ensure your operators are addressing these critical risks.

Sabra Health Care REIT, Inc. (SBRA) - PESTLE Analysis: Legal factors

You're operating in a sector where your tenants' clinical and billing compliance is your legal risk. The regulatory environment for skilled nursing facilities (SNFs) and senior housing is tightening in 2025, driven by post-pandemic scrutiny and aggressive federal enforcement. This means Sabra Health Care REIT, Inc. (SBRA) must be defintely vigilant about operator quality and financial strength, because the legal costs of their missteps are ultimately a financial risk to your rent coverage.

Increased litigation risk related to wrongful death and neglect post-COVID-19

The post-COVID-19 environment has permanently heightened the risk of litigation for nursing home operators, and by extension, for the REITs that own the real estate. Families and state attorneys are pursuing wrongful death and neglect claims with greater frequency, often citing understaffing and poor infection control that became endemic during the pandemic. The financial exposure here is significant, and your operators' insurance and balance sheets are the first line of defense.

Here's the quick math: While the average nursing home neglect settlement hovers around $251,296, wrongful death cases, especially those tied to severe neglect, commonly result in settlements ranging from $400,000 to over $1 million. In egregious cases, settlements can even reach $1.5 million to $4 million. What this estimate hides is the operational drag-the time, reputation damage, and increased insurance premiums that follow a major lawsuit, all of which stress your operator's ability to pay rent.

Stricter enforcement of False Claims Act (FCA) related to billing and medical necessity

The Department of Justice (DOJ) is not slowing down its pursuit of healthcare fraud, particularly through the False Claims Act (FCA), which allows the government to recover funds from those who knowingly submit false claims to federal programs like Medicare and Medicaid. The healthcare industry accounted for over $1.67 billion, or more than 57%, of the DOJ's total FCA recoveries of nearly $2.9 billion in Fiscal Year 2024.

This is a direct threat to your operators' revenue stream. In 2025, we've already seen a skilled nursing chain agree to pay $18 million to resolve FCA allegations related to COVID-19 relief fraud, and another group of affiliated skilled nursing facilities pay $21.3 million for knowingly billing for medically unnecessary therapy services. Furthermore, the Centers for Medicare & Medicaid Services (CMS) reported an improper payment rate for SNF services that rose to 17.2% in 2024, representing approximately $5.9 billion in projected improper payments, which is a clear signal of where future enforcement is headed.

New state-level regulations on rent control or tenant rights for senior housing

While rent control has historically targeted multi-family residential properties, the political appetite to extend these measures to senior housing is growing, especially in high-cost-of-living states. This is a critical legal headwind for Sabra Health Care REIT's Senior Housing-Leased portfolio, as it directly caps your revenue growth potential.

In California, the Tenant Protection Act (AB 1482) limits annual rent increases to 5% plus the Consumer Price Index (CPI), with a hard cap of 10%. For 2025, the allowable increase is generally ranging between 6% and 9%, depending on the local CPI. Meanwhile, New Jersey has local ordinances in about 117 municipalities, with 2025 caps like 3.55% in Highland Park and 3.4% in New Brunswick. This patchwork of regulation complicates asset management and makes it harder to project triple-net lease revenue growth with certainty.

Lease restructuring negotiations with struggling operators are a constant legal and financial focus

The core legal and financial work for Sabra Health Care REIT in 2025 continues to be managing the balance sheets of its weaker tenants. When an operator struggles, the REIT must engage in complex lease restructuring, which is a legal negotiation that often involves converting triple-net leases to a Senior Housing-Managed (SHOP) structure, or even outright asset sales. This is a crucial de-risking strategy, but it carries immediate financial costs.

In the third quarter of 2025 alone, Sabra Health Care REIT demonstrated this focus by purchasing the operations of four managed senior housing properties for $19.7 million, which were previously under triple-net leases. This restructuring resulted in a Q3 2025 write-off of $9.2 million in straight-line rent receivables and a $1.2 million lease termination expense. This is the cost of cleaning up a distressed relationship. The company has been actively transitioning assets, with total investments closed year-to-date in 2025 reaching $421.9 million, much of it focused on shifting to the SHOP model for better control and performance.

The legal landscape is a cost center right now, not a tailwind.

The key legal risks for Sabra Health Care REIT are not just fines, but the operational instability they create for your tenants. This translates directly into a higher probability of lease default, forcing your team into costly negotiations. Your next step is to have Legal and Finance map the portfolio's exposure to the top three tenants-Avamere, Ensign Group, and Signature Group-who comprise a quarter of Sabra Health Care REIT's Net Operating Income (NOI), and assess their litigation reserves against the average settlement data.

Sabra Health Care REIT, Inc. (SBRA) - PESTLE Analysis: Environmental factors

Growing investor demand for detailed Environmental, Social, and Governance (ESG) reporting on portfolio energy use and waste.

The pressure from institutional investors for robust Environmental, Social, and Governance (ESG) data is no longer a fringe request; it's a baseline requirement for capital allocation in 2025.

Investors are demanding structured, transparent, and financially relevant disclosures, moving past high-level narratives to focus on quantifiable business intelligence. For a Real Estate Investment Trust (REIT) like Sabra Health Care REIT, Inc., this means treating environmental metrics-like energy and water consumption-as core financial data. You need to show a clear link between sustainability initiatives and financial outcomes, like cost savings or risk mitigation, to stay competitive.

In the REIT sector, 100% of the top 100 equity REITs by market capitalization publicly reported on sustainability in 2023, confirming this is the industry standard you must maintain. Sabra Health Care REIT, Inc. is meeting this by releasing its fifth annual Sustainability Report for the fiscal year 2024 in July 2025, detailing its progress.

Climate change risk, specifically extreme weather events, increases property insurance costs and operational disruption.

Honestly, climate risk is now operating risk. The escalating frequency and severity of extreme weather events-with the U.S. averaging 23 billion-dollar plus disasters per year in the last four years, up from 9 per year historically-is directly hitting your bottom line via property insurance costs. This rise is squeezing Net Operating Income (NOI) and can even impact property valuations.

Sabra Health Care REIT, Inc. has been proactive, which is smart. They revamped their company-wide insurance program to better address physical climate risks, leveraging their understanding of these risks in discussions with their broker, Marsh. This strategic review allowed them to reduce the overall cost of their insurance program while actually enhancing the scope of their coverage, a critical fiduciary win in this market. They also use third-party tools like ClimateCheck to assess physical risk across the geographically diverse portfolio during due diligence.

Focus on energy efficiency upgrades (e.g., LED lighting, low-flow fixtures) to meet sustainability targets.

The path to meeting sustainability targets in healthcare real estate is paved with efficiency upgrades, and the financial returns are clear. Sabra Health Care REIT, Inc. has made significant capital commitments here. Since 2022, the company has invested over $70 million to modernize its senior housing communities, focusing on retrofits for lighting, water, and HVAC systems.

To help their triple-net (NNN) lease operators, who are responsible for utility costs, Sabra Health Care REIT, Inc. committed an additional $5 million in 2024 to energy and water efficiency projects through its Green Links and Green Fund Programs. This fund allows operators to access up to 100% of the capital needed for improvements like LED lighting and then pay it back via the utility savings they realize. Here's the quick math on the portfolio impact:

Disclosure requirements on carbon footprint and climate risk are defintely becoming more standardized.

The regulatory landscape is consolidating, and what was voluntary is fast becoming mandatory. Global standards like the International Sustainability Standards Board (ISSB) and European mandates such as the Corporate Sustainability Reporting Directive (CSRD) are creating a ripple effect, setting a high bar for disclosure that even US-focused REITs must consider due to international investor exposure.

This means your carbon footprint and climate risk assessment must be integrated into your enterprise risk management (ERM) program, not just filed separately. Sabra Health Care REIT, Inc. has a Corporate Responsibility and Governance Committee that oversees climate-related disclosures, and the Board monitors these practices as part of the overall ERM.

The key focus areas for standardized disclosure and action in 2025 are:

• Quantify physical climate risk (flood, fire, heat) at the asset level.
• Report on Scope 1, 2, and increasingly Scope 3 (tenant) GHG emissions.
• Align emissions reduction targets with verifiable frameworks.
• Document the financial impact of rising insurance and compliance costs.