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

Attached files

file	filename
EX-99.1 - EXHIBIT 99.1 - HEALTHCARE REALTY TRUST INC	exhibit991secondquarter201.htm
8-K - 8-K - HEALTHCARE REALTY TRUST INC	hr-2016630xearnings8xk.htm

2Q | 2016

Supplemental Information

FURNISHED AS OF AUGUST 3, 2016 (UNAUDITED)

Table of Contents




3			Corporate Information

5			Balance Sheet Information

6			Statements of Income Information

7			Historical Reconciliation of FFO

8			Debt Metrics

9			Investment Activity

10			Portfolio by Market

11			Square Feet by Provider

12			Square Feet by Proximity

13			Lease Maturity, Size and Building Square Feet

14			Occupancy Information

15			Same Store Properties

16			Reconciliation of NOI

17			Same Store Leasing Statistics

18			Components of Net Asset Value

19			Components of Expected 2016 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.

Forward looking statements and 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,” “annualized,” “expect,” “expected,” “future cash or NOI,” “deferred revenue,” “rent increases,” “range of expectations,” "budget," “components of expected 2016 FFO,” 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: 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, 2015 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.





HEALTHCARE REALTY 2		2Q 2016 SUPPLEMENTAL INFORMATION

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 June 30, 2016, the Company had investments of approximately $3.4 billion in 202 real estate properties in 30 states totaling approximately 14.5 million square feet. The Company provided leasing and property management services to approximately 10.0 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
E-mail: communications@healthcarerealty.com
Website: www.healthcarerealty.com

Executive Officers



David R. Emery		Chairman of the Board and Chief Executive Officer
John M. Bryant, Jr.		Executive Vice President and General Counsel
J. Christopher Douglas		Executive Vice President and Chief Financial Officer
Todd J. Meredith		Executive Vice President - Investments
B. Douglas Whitman, II		Executive Vice President - Corporate Finance

Board of Directors



David R. Emery		Chairman of the Board and Chief Executive Officer, Healthcare Realty Trust Incorporated
Nancy H. Agee		President and Chief Executive Officer, Carilion Clinic
C. Raymond Fernandez, M.D.		Retired Chief Executive Officer, Piedmont Clinic
Peter F. Lyle		Vice President of Health Systems, Pharma and Medical Practice Services, Medical Management Associates, Inc.
Edwin B. Morris III		Managing Director, Morris & Morse Company, Inc.
J. Knox Singleton		President and Chief Executive Officer, Inova Health System
Bruce D. Sullivan		Retired Audit Partner, Ernst & Young LLP
Christann M. Vasquez		President, Dell Seton Medical Center at University of Texas
Dan S. Wilford		Retired Chief Executive Officer, Memorial Hermann Healthcare System





HEALTHCARE REALTY 3		2Q 2016 SUPPLEMENTAL INFORMATION

Corporate Information

Professional Services



INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
BDO USA, LLP
414 Union Street, Suite 1800, Nashville, Tennessee 37219
TRANSFER AGENT
Wells Fargo N.A., Shareowner Services
1110 Centre Pointe Curve, Suite 101, Mendota Heights, Minnesota 55120-4100

Stock Exchange, Symbol and CUSIP Number



SECURITY DESCRIPTION	STOCK EXCHANGE	SYMBOL	CUSIP NUMBER
Common Stock	NYSE	HR	421946104
Senior Notes due 2021	OTC	HR	421946AG9
Senior Notes due 2023	OTC	HR	421946AH7
Senior Notes due 2025	OTC	HR	421946AJ3

Dividend Reinvestment Plan



Through the Company’s transfer agent, Wells Fargo, named stockholders of record can re-invest dividends in shares at a 5% discount and may also purchase up to $60,000 of HR common stock per calendar year without a service or sales charge. For information, write Wells Fargo Shareowner Services, P.O. Box 64856, St. Paul, Minnesota 55164-0856, or call 1.800.468.9716. Information may also be obtained at the transfer agent’s website, www.shareowneronline.com.

Direct Deposit of Dividends



Direct deposit of dividends is offered as a convenience to stockholders of record. For information, write Wells Fargo Shareowner Services, P.O. Box 64856, St. Paul, Minnesota 55164-0856, or call 1.800.468.9716. Information may also be obtained at the transfer agent’s website, www.shareowneronline.com.

Dividends Declared



On August 2, 2016, the Company declared a dividend of $0.30 per share, payable on August 31, 2016, to stockholders of record on August 17, 2016.

Analyst Coverage



Cantor Fitzgerald, L.P.		KeyBanc Capital Markets Inc.

Goldman, Sachs & Co.		Mizuho Securities USA Inc.

Green Street Advisors, Inc.		RBC Capital Markets, LLC

J.J.B. Hilliard W.L. Lyons, LLC		Stifel, Nicolaus & Company, Inc.

J.P. Morgan Securities LLC		SunTrust Robinson Humphrey, Inc.

JMP Securities LLC		Wells Fargo Securities, LLC

Morgan Stanley





HEALTHCARE REALTY 4		2Q 2016 SUPPLEMENTAL INFORMATION

Balance Sheet Information ⁽¹⁾

(dollars in thousands, except per share data)



ASSETS

	2016						2015
Real estate properties:	Q2			Q1			Q4			Q3			Q2
Land		$208,386			$201,157			$198,585			$186,108			$186,231
Buildings, improvements and lease intangibles	3,235,744			3,181,748			3,135,893			3,042,367			3,033,213
Personal property	10,032			9,881			9,954			9,833			9,970
Construction in progress	35,174			31,669			19,024			15,455			8,284
Land held for development	17,438			17,434			17,452			17,475			16,952
Total real estate properties	3,506,774			3,441,889			3,380,908			3,271,238			3,254,650
Less accumulated depreciation and amortization	(819,744		)	(790,819		)	(761,926		)	(737,398		)	(730,125		)
Total real estate properties, net	2,687,030			2,651,070			2,618,982			2,533,840			2,524,525
Cash and cash equivalents	9,026			2,174			4,102			8,497			8,431
Mortgage notes receivable	—			—			—			—			1,900
Assets held for sale and discontinued operations, net	710			706			724			6,380			14,192
Other assets, net ⁽²⁾	185,298			187,665			186,416			186,221			184,592
Total assets		$2,882,064			$2,841,615			$2,810,224			$2,734,938			$2,733,640

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Notes and bonds payable ⁽²⁾		$1,414,739			$1,418,347			$1,424,992			$1,374,537			$1,381,865
Accounts payable and accrued liabilities	70,408			66,013			75,489			65,839			57,143
Liabilities of discontinued operations	17			20			33			216			168
Other liabilities	46,452			64,236			66,963			65,648			66,035
Total liabilities	1,531,616			1,548,616			1,567,477			1,506,240			1,505,211
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 50,000 shares authorized; none issued and outstanding	—			—			—			—			—
Common stock, $.01 par value; 150,000 shares authorized	1,067			1,042			1,015			1,005			1,004
Additional paid-in capital	2,609,880			2,533,130			2,461,376			2,435,849			2,432,979
Accumulated other comprehensive loss	(1,485		)	(1,527		)	(1,569		)	(1,611		)	(1,653		)
Cumulative net income attributable to common stockholders	930,985			918,841			909,685			891,027			863,547
Cumulative dividends	(2,189,999		)	(2,158,487		)	(2,127,760		)	(2,097,572		)	(2,067,448		)
Total stockholders' equity	1,350,448			1,292,999			1,242,747			1,228,698			1,228,429
Total liabilities and stockholders' equity		$2,882,064			$2,841,615			$2,810,224			$2,734,938			$2,733,640



CAPITAL FUNDING
Re/development	$8,542	$16,758	$9,322	$7,103	$4,165
1st generation tenant improvements	4,677	393	3,208	3,959	1,150
2nd generation tenant improvements	6,119	4,888	4,281	3,637	2,496
Leasing commissions paid	1,587	1,079	1,856	1,050	1,251
Capital additions:
Revenue enhancing	1,525	717	1,803	1,963	3,188
Routine and non-revenue enhancing	4,377	1,600	2,393	1,543	3,580


(1)	The balance sheet information is presented as of the last day of the quarter indicated.


(2)	The Company adopted a new accounting standard (ASU 2015-03 - "Simplifying the Presentation of Debt Issuance Costs") on January 1, 2016 which resulted in a reclassification of deferred financing costs from Other assets to the Notes and bonds payable line item.





HEALTHCARE REALTY 5		2Q 2016 SUPPLEMENTAL INFORMATION

Statements of Income Information

(dollars in thousands)




	2016						2015												2014
	Q2			Q1			Q4			Q3			Q2			Q1			Q4			Q3
Revenues
Rental income		$101,472			$98,740			$97,466			$95,383			$95,450			$95,034			$93,648			$92,095
Mortgage interest	—			—			—			29			31			31			32			44
Other operating	1,170			1,281			1,116			1,313			1,227			1,391			1,320			1,474
	102,642			100,021			98,582			96,725			96,708			96,456			95,000			93,613
Expenses
Property operating	36,263			35,406			36,758			35,247			33,927			34,263			33,386			34,204
General and administrative	8,129			10,246			7,216			6,258			6,713			6,738			5,990			5,185
Depreciation	28,528			27,693			27,019			26,571			26,552			26,387			25,881			25,345
Amortization	2,762			2,700			2,556			2,386			2,474			2,667			2,630			2,656
Bad debts, net of recoveries	78			(39		)	9			(21		)	27			(207		)	(92		)	3
	75,760			76,006			73,558			70,441			69,693			69,848			67,795			67,393
Other Income (Expense)
Gain on sales of real estate properties	1			—			9,138			5,915			41,549			—			—			—
Interest expense	(14,815		)	(14,938		)	(14,885		)	(15,113		)	(17,213		)	(18,322		)	(18,237		)	(18,192		)
Loss on extinguishment of debt	—			—			—			—			(27,998		)	—			—			—
Pension termination	(4		)	—			—			—			(5,260		)	—			—			—
Impairment of real estate assets	—			—			(1		)	(310		)	—			(3,328		)	—			—
Impairment of internally-developed software	—			—			—			—			(654		)	—			—			—
Interest and other income, net	93			86			78			72			147			91			91			409
	(14,725		)	(14,852		)	(5,670		)	(9,436		)	(9,429		)	(21,559		)	(18,146		)	(17,783		)

Income From Continuing Operations	12,157			9,163			19,354			16,848			17,586			5,049			9,059			8,437

Discontinued Operations
Income (loss) from discontinued operations	(19		)	(7		)	(10		)	61			330			333			729			221
Impairments of real estate assets	—			—			(686		)	—			—			—			(995		)	(4,505		)
Gain on sales of real estate properties	7			—			—			10,571			—			—			9,280			—
Income (Loss) From Discontinued Operations	(12		)	(7		)	(696		)	10,632			330			333			9,014			(4,284		)

Net Income	12,145			9,156			18,658			27,480			17,916			5,382			18,073			4,153
Less: Net income attributable to noncontrolling interests	—			—			—			—			—			—			—			(162		)
Net Income Attributable To Common Stockholders		$12,145			$9,156			$18,658			$27,480			$17,916			$5,382			$18,073			$3,991





HEALTHCARE REALTY 6		2Q 2016 SUPPLEMENTAL INFORMATION

Historical Reconciliation of FFO ^{(1) (2)}

(amounts in thousands, except for share data)




				2016		2015											2014
	Q2			Q1		Q4			Q3			Q2			Q1		Q4			Q3
Net Income Attributable to Common Stockholders		$12,145			$9,156		$18,658			$27,480			$17,916			$5,382		$18,073			$3,991
Gain on sales of real estate properties	(8		)	—		(9,138		)	(16,486		)	(41,549		)	—		(9,280		)	—
Impairments of real estate assets	—			—		687			310			—			3,328		995			4,505
Real estate depreciation and amortization	31,716			30,800		29,907			29,317			29,388			29,370		28,707			28,450
Total adjustments	31,708			30,800		21,456			13,141			(12,161		)	32,698		20,422			32,955
Funds from Operations Attributable to Common Stockholders		$43,853			$39,956		$40,114			$40,621			$5,755			$38,080		$38,495			$36,946
Acquisition costs	232			1,618		1,068			121			167			38		471			188
Pension termination	4			—		—			—			5,260			—		—			—
Loss on extinguishment of debt	—			—		—			—			27,998			—		—			—
Impairment of internally-developed software	—			—		—			—			654			—		—			—
Severance expense	—			—		—			—			—			141		—			—
Security deposit recognized upon sale	—			—		—			—			—			—		(407		)	—
Reversal of restricted stock amortization upon director / officer resignation	—			—		(40		)	—			—			—		(115		)	(445		)
Revaluation of awards upon retirement	—			89		—			—			—			—		—			—
Normalized Funds from Operations Attributable to Common Stockholders		$44,089			$41,663		$41,142			$40,742			$39,834			$38,259		$38,444			$36,689
Funds from Operations per Common Share—Diluted		$0.42			$0.39		$0.40			$0.41			$0.06			$0.38		$0.39			$0.38
Normalized Funds from Operations Per Common Share—Diluted		$0.42			$0.41		$0.41			$0.41			$0.40			$0.39		$0.39			$0.38
FFO Weighted Average Common Shares Outstanding	104,770			102,165		100,474			99,997			99,945			99,137		98,086			97,329

(1)

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 the most commonly accepted and reported measure of a REIT’s operating performance equal to “net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property, plus depreciation and amortization (including amortization of leasing commissions), and after adjustments for unconsolidated partnerships and joint ventures.”

(2)

FFO does 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 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.





HEALTHCARE REALTY 7		2Q 2016 SUPPLEMENTAL INFORMATION

Debt Metrics

(dollars in thousands)



SUMMARY OF INDEBTEDNESS
	Q2 2016 Interest Expense ⁽¹⁾	Balance as of 6/30/2016	Weighted Months to Maturity	Effective Interest Rate
Senior Notes due 2021, net of discount	$5,830	$396,816	55	5.97	%
Senior Notes due 2023, net of discount	2,391	247,096	82	3.95	%
Senior Notes due 2025, net of discount⁽²⁾	2,469	247,709	106	4.08	%
Total Senior Notes Outstanding	$10,690	$891,621	76	4.89	%
Unsecured credit facility due 2017 ⁽³⁾	823	190,000	10	1.61	%
Unsecured term loan facility due 2019 ⁽³⁾	831	199,374	32	1.66	%
Mortgage notes payable, net	1,668	133,744	78	5.17	%
Total Outstanding Notes and Bonds Payable	$14,012	$1,414,739	61	4.02	%
Interest cost capitalization	(273)
Unsecured credit facility fee and deferred financing costs	1,076
Total Quarterly Consolidated Interest Expense	$14,815



SELECTED FINANCIAL DEBT COVENANTS ⁽⁴⁾
	Calculation	Requirement	Trailing Twelve Months Ended 6/30/2016		Proforma ⁽⁶⁾
Revolving Credit Facility and Term Loan
Leverage Ratio	Total Debt / Total Capital	Not greater than 60%	39.7	%	32.4	%
Secured Leverage Ratio	Total Secured Debt / Total Capital	Not greater than 30%	3.7	%
Unencumbered Leverage Ratio	Unsecured Debt / Unsecured Real Estate	Not greater than 60%	40.7	%
Fixed Charge Coverage Ratio	EBITDA / Fixed Charges	Not less than 1.65x	3.5x
Unsecured Coverage Ratio	Unsecured EBITDA / Unsecured Interest	Not less than 1.75x	4.0x
Excess Tangible Net Worth	Tangible Net Worth - Required Base	Greater than $0	$956,398
Construction and Development	CIP / Total Assets	Not greater than 15%	1.2	%
Asset Investments	Mortgages & Unimproved Land / Total Assets	Not greater than 20%	0.6	%

Senior Notes
Incurrence of Total Debt	Total Debt / Total Assets	Not greater than 60%	38.5	%	31.5	%
Incurrence of Debt Secured by Any Lien	Secured Debt / Total Assets	Not greater than 40%	3.6	%
Maintenance of Total Unsecured Assets	Unencumbered Assets / Unsecured Debt	Not less than 150%	260.5	%
Debt Service Coverage	EBITDA / Interest Expense	Not less than 1.5x	3.9x

Other
Net Debt to EBITDA	Total Debt less Cash on Hand / EBITDA	Not required	6.3x		4.9x
Debt to Enterprise Value ⁽⁵⁾	Total Debt / Enterprise Value	Not required	25.4	%	22.0	%


(1)	The Company adopted a new accounting standard (ASU 2015-03 - "Simplifying the Presentation of Debt Issuance Costs") on January 1, 2016 which resulted in a reclassification of deferred financing costs from Other assets to the Notes and bonds payable line item. The Company adjusted the effective interest rates to reflect this change.


(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)	As of July 5, 2016, the balance of the unsecured credit facility due 2017, which on July 29, 2016 was amended and extended through July 2020, was repaid with proceeds from the issuance of 9.2 million shares resulting in proceeds of $304.6 million. In addition, the Company repaid $50.0 million outstanding on the unsecured term loan due 2019.


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


(5)	Based on the closing price of $36.16 on July 29, 2016 and 115,862,407 shares outstanding.


(6)	The proforma calculations include the effects of issuance of 9.2 million shares at $33.13 for net proceeds, after offering expenses, of $304.6 million.





HEALTHCARE REALTY 8		2Q 2016 SUPPLEMENTAL INFORMATION

Investment Activity

(dollars in thousands)



2016 ACQUISITION ACTIVITY

Location	Campus Location	Distance to Campus	Health System Affiliation	Closing	Purchase Price	Acquisition Costs	Square Feet	Aggregate Leased %		Cap Rate ⁽²⁾
Seattle, WA ⁽¹⁾	ADJ	0.24 miles	UW Medicine	3/31/2016	$38,259	$1,618	69,712	100	%	5.5	%
Seattle, WA	ON	0.00 miles	UW Medicine	4/29/2016	21,615	362	46,637	100	%	5.9	%
Los Angeles, CA	ON	0.00 miles	HCA	5/13/2016	20,000	232	63,012	80	%	5.1	%
Total					$79,874	$2,212	179,361	93	%	5.5	%



HISTORICAL INVESTMENT ACTIVITY
	Acquisitions⁽³⁾		Mortgage Funding		Construction Mortgage Funding		Re/Development Funding		Total Investments		Dispositions
2012	$94,951		—		$78,297		$5,608		$178,856		$91,384
2013	216,956		—		58,731		—		275,687		101,910
2014	85,077		1,900		1,244		4,384		92,605		34,840
2015	187,216		—		—		27,859		215,075		157,975
2016	79,874		—		—		25,300		105,174		—
Total	$664,074		$1,900		$138,272		$63,151		$867,397		$386,109
% of Total	76.6	%	0.2	%	15.9	%	7.3	%	100	%



RE/DEVELOPMENT ACTIVITY
Location	Type ⁽⁴⁾	Campus Location	Square Feet	Budget	Amount Funded Q2 2016	Total Amount Funded Through 6/30/2016	Estimated Remaining Fundings	Aggregate Leased %		Estimated Completion Date
Construction activity
Nashville, TN ⁽⁵⁾	Redev	On	294,000	$51,800	$6,418	$39,230	$12,570	83	%	Q1 2017
Denver, CO	Dev	On	98,000	26,500	2,124	2,994	23,506	35	%	Q2 2017
Total construction activity			392,000	$78,300	$8,542	$42,224	$36,076	71	%


(1)	Acquisition costs in Q1 2016 include seller credits related to a loan prepayment, brokerage commission and excise taxes.


(2)	Represents the forecasted first year NOI / purchase price plus acquisition costs and expected capital additions.


(3)	Net of mortgage notes receivable payoffs upon acquisition.


(4)	Redev - Redevelopment; Dev - Development


(5)	Includes $15.2 million for the addition of 70,000 rentable square feet, $18.9 million for a 907-space parking garage and associated land and $17.7 million for existing building upgrades and tenant improvement allowances associated with newly executed leases.





HEALTHCARE REALTY 9		2Q 2016 SUPPLEMENTAL INFORMATION

Portfolio by Market

(dollars in thousands)



BY MARKET
		SQUARE FEET
		MOB/OUTPATIENT (89.4%)				INPATIENT (7.0%)				OTHER (3.6%)
	Investment⁽¹⁾	Multi-tenant		Single-tenant Net Lease		Rehab		Surgical		Other		Total		% of Total
Dallas - Fort Worth, TX	$480,258	2,149,939				42,627		156,245				2,348,811		16.1	%
Charlotte, NC	167,372	820,457										820,457		5.7	%
Seattle - Bellevue, WA	333,127	752,267		67,510								819,777		5.7	%
Nashville, TN	105,252	762,708										762,708		5.2	%
Los Angeles, CA	159,396	551,383				63,000						614,383		4.2	%
Houston, TX	129,127	591,027										591,027		4.1	%
Richmond, VA	146,718	548,801										548,801		3.8	%
Des Moines, IA	133,752	233,413		146,542						152,655		532,610		3.7	%
San Antonio, TX	103,115	483,811				39,786						523,597		3.6	%
Memphis, TN	91,337	515,876										515,876		3.6	%
Roanoke, VA	48,965			334,454						126,427		460,881		3.2	%
Austin, TX	131,063	354,481				66,095				12,958		433,534		3.0	%
Indianapolis, IN	77,029	382,695										382,695		2.6	%
Denver, CO	109,517	346,335				34,068						380,403		2.6	%
Honolulu, HI	136,717	298,427										298,427		2.1	%
Oklahoma City, OK	109,074	68,860		200,000								268,860		1.9	%
Chicago, IL	57,636	243,491										243,491		1.7	%
Miami, FL	52,897	241,980										241,980		1.7	%
Colorado Springs, CO	51,708	241,224										241,224		1.7	%
Phoenix, AZ	64,431	179,963				51,903						231,866		1.6	%
Detroit, MI	25,258	199,749								11,308		211,057		1.5	%
San Francisco, CA	86,143	210,621										210,621		1.5	%
South Bend, IN	43,961	205,573										205,573		1.4	%
Springfield, MO	111,293							186,000				186,000		1.3	%
Washington, DC	31,437	182,836										182,836		1.3	%
Other (31 markets)	462,041	1,324,132		296,623		373,722				214,864		2,209,341		15.2	%
Total	$3,448,624	11,890,049		1,045,129		671,201		342,245		518,212		14,466,836		100.0	%
Number of Properties		165		14		11		2		10		202
Percent of Square Feet		82.2	%	7.2	%	4.6	%	2.4	%	3.6	%	100.0	%
Investment ⁽¹⁾		$2,719,267		$248,556		$191,815		$208,725		$80,261		$3,448,624
% of Investment		78.8	%	7.2	%	5.6	%	6.1	%	2.3	%	100.0	%



MSA BY RANK (% of total SF)
Rank	MOB / Outpatient		Total
Top 25	58	%	55	%
Top 50	83	%	78	%
Top 75	87	%	81	%
Top 100	91	%	87	%


(1)	Excludes gross assets held for sale, land held for development, construction in progress and corporate property.





HEALTHCARE REALTY 10		2Q 2016 SUPPLEMENTAL INFORMATION

Square Feet by Provider ⁽¹⁾



MOB SQUARE FEET
			ASSOCIATED (92.9%) ⁽²⁾
Top Providers	Health System Rank⁽³⁾	Credit Rating	On		Adjacent ⁽⁴⁾		Anchored ⁽⁵⁾		Off		Total MOB SF	% of Total MOB SF
Baylor Scott & White Health	19	AA-/Aa3	1,834,256		129,879		163,188		—		2,127,323	16.4	%
Ascension Health	3	AA+/Aa2	967,996		148,356		30,096		—		1,146,448	8.9	%
Catholic Health Initiatives	7	A-/--	769,471		132,617		95,486		—		997,574	7.7	%
HCA	2	BB/B1	460,839		185,904		157,388		—		804,131	6.2	%
Carolinas HealthCare System	27	--/Aa3	353,537		98,066		313,513		—		765,116	5.9	%
Tenet Healthcare Corporation	6	B/B1	570,264		67,790		—		—		638,054	4.9	%
Bon Secours Health System	49	A-/A3	548,801		—		—		—		548,801	4.2	%
Baptist Memorial Health Care	105	A-/--	424,306		—		39,345		—		463,651	3.6	%
Indiana University Health	22	AA-/Aa3	280,129		102,566		—		—		382,695	3.0	%
University of Colorado Health	73	AA-/Aa3	150,291		161,099		33,850		—		345,240	2.7	%
Trinity Health	8	AA-/Aa3	205,573		73,331		—		—		278,904	2.2	%
Providence Health & Services	9	AA-/Aa3	126,361		129,181		—		—		255,542	2.0	%
Medstar Health	31	A-/A2	241,739		—		—		—		241,739	1.9	%
Advocate Health Care	26	AA/Aa2	142,955		95,436		—		—		238,391	1.8	%
Memorial Hermann	43	A+/A1	—		206,090		—		—		206,090	1.6	%
Community Health	4	B+/B2	201,574		—		—		—		201,574	1.6	%
Mercy (St. Louis)	30	AA-/Aa3	—		—		200,000		—		200,000	1.5	%
Overlake Health System	343	A/A2	191,051		—		—		—		191,051	1.5	%
University of Washington	90	AA+/Aa1	107,074		69,712		—		—		176,786	1.4	%
Other credit rated			695,273		560,499		90,607		—		1,346,379	10.4	%
Subtotal - credit rated ⁽⁶⁾			8,271,490		2,160,526		1,123,473		—		11,555,489	89.3	%
Non-credit rated			269,506		192,418		—		917,765		1,379,689	10.7	%
Total			8,540,996		2,352,944		1,123,473		917,765		12,935,178	100.0	%
% of Total			66.0	%	18.2	%	8.7	%	7.1	%



HEALTH SYSTEM ⁽²⁾⁽³⁾ BY RANK (% of total SF)
Rank	MOB / Outpatient		Total
Top 25	55	%	51	%
Top 50	73	%	69	%
Top 75	77	%	72	%
Top 100	79	%	77	%



LEASED SQUARE FEET
					LEASED SQUARE FEET
Top Providers	Health System Rank⁽³⁾	Credit Rating	# of Buildings	# of Leases	MOB	Inpatient / Other	Total	% of Total Leased SF		% of Total Revenue
Baylor Scott & White Health	19	AA-/Aa3	23	159	988,326	156,245	1,144,571	9.0	%	10.0	%
Mercy (St. Louis)	30	AA-/Aa3	2	2	200,000	186,000	386,000	3.0	%	4.6	%
Catholic Health Initiatives	7	A-/--	14	82	549,166	—	549,166	4.3	%	4.5	%
Carolinas HealthCare System	27	--/Aa3	16	77	584,767	—	584,767	4.6	%	4.4	%
HealthSouth	89	BB-/Ba3	5	5	—	351,989	351,989	2.8	%	2.9	%
HCA	2	BB/B1	15	22	462,957	—	462,957	3.6	%	2.7	%
Baptist Memorial Health Care	105	A-/--	7	18	105,419	—	105,419	0.8	%	2.7	%
Bon Secours Health System	49	A-/A3	7	62	269,025	—	269,025	2.1	%	2.2	%
Ascension Health	3	AA+/Aa2	16	51	305,214	—	305,214	2.4	%	2.0	%
Tenet Healthcare Corporation	6	B/B1	10	35	121,887	63,000	184,887	1.5	%	1.7	%
Total								34.1	%	37.7	%


(1)	Excludes mortgage notes receivable, construction in progress 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)	Based on square footage, 89.3% of HR's MOB portfolio is associated with a credit-rated healthcare provider and 76.4% is associated with an investment-grade rated healthcare provider.



HEALTHCARE REALTY 11		2Q 2016 SUPPLEMENTAL INFORMATION

Square Feet by Proximity ⁽¹⁾⁽²⁾



MEDICAL OFFICE BUILDINGS BY LOCATION
	2016 ⁽³⁾				2015
	Q2		Q1		Q4		Q3		Q2		Q1
On campus	66	%	66	%	67	%	67	%	68	%	68	%
Adjacent to campus ⁽³⁾	18	%	18	%	13	%	13	%	12	%	12	%
Total on/adjacent	84	%	84	%	80	%	80	%	80	%	80	%
Off campus - anchored by hospital system ⁽⁴⁾	9	%	9	%	9	%	9	%	9	%	9	%
Off campus	7	%	7	%	11	%	11	%	11	%	11	%
	100	%	100	%	100	%	100	%	100	%	100	%



MEDICAL OFFICE BUILDINGS BY DISTANCE TO HOSPITAL CAMPUS
Greater than	Less than or equal to	Number of Buildings	Square Feet	% of Total		Cumulative %		Campus Proximity
	0.00	107	8,540,996	66	%	66	%	On campus
0.00	250 yards	19	1,231,736	9	%	75	%	Adjacent ⁽³⁾
250 yards	0.25 miles	19	1,121,208	9	%	84	%	Adjacent ⁽³⁾
0.25 miles	0.50	3	143,690	1	%	85	%	Off campus
0.50	1.00	3	336,602	3	%	88	%
1.00	2.00	8	608,486	5	%	93	%
2.00	5.00	10	476,633	4	%	97	%
5.00	10.00	6	332,359	2	%	99	%
10.00		4	143,468	1	%	100	%
Total		179	12,935,178	100	%


(1)	Excludes mortgage notes receivable, construction in progress and assets classified as held for sale.


(2)	Hospitals include 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)	Beginning in Q1 2016, the Company adopted a definition of an adjacent property as being no more than 0.25 miles from a hospital campus.


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





HEALTHCARE REALTY 12		2Q 2016 SUPPLEMENTAL INFORMATION

Lease Maturity, Size and Building Square Feet ⁽¹⁾

(dollars in thousands)



LEASE MATURITY SCHEDULE
	MULTI-TENANT				SINGLE-TENANT NET LEASE				TOTAL
	Number of Leases	Square Feet	% of Square Feet		Number of Leases	Square Feet	% of Square Feet		Number of Leases	Square Feet	% of Total Square Feet
2016	330	1,019,269	10.1	%	1	8,749	0.4	%	331	1,028,018	8.3	%
2017	373	1,605,165	15.9	%	5	334,454	14.6	%	378	1,939,619	15.6	%
2018	335	1,566,757	15.5	%	—	—	—	%	335	1,566,757	12.7	%
2019	315	1,417,510	14.0	%	9	371,805	16.3	%	324	1,789,315	14.4	%
2020	236	1,226,609	12.1	%	1	83,318	3.6	%	237	1,309,927	10.6	%
2021	146	682,585	6.7	%	2	143,868	6.3	%	148	826,453	6.7	%
2022	93	681,845	6.7	%	2	137,016	6.0	%	95	818,861	6.6	%
2023	101	747,926	7.4	%	1	75,000	3.3	%	102	822,926	6.6	%
2024	57	422,922	4.2	%	1	51,903	2.3	%	58	474,825	3.8	%
2025	37	382,870	3.8	%	2	91,561	4.0	%	39	474,431	3.8	%
Thereafter	37	359,282	3.6	%	10	987,073	43.2	%	47	1,346,355	10.9	%



BY LEASE SIZE
	NUMBER OF LEASES
Square Footage	Multi-Tenant Properties ⁽²⁾	Single-Tenant Net Lease Properties
0 - 2,500	976	—
2,501 - 5,000	565	—
5,001 - 7,500	187	1
7,501 - 10,000	112	1
10,001 +	220	32
Total Leases	2,060	34



BY BUILDING SQUARE FEET
Size Range by Square Feet	% of Total		Total Square Footage	Average Square Feet	Number of Properties
>100,000	43.1	%	6,235,128	145,003	43
<100,000 and >75,000	23.1	%	3,341,479	85,679	39
<75,000 and >50,000	18.7	%	2,704,580	62,897	43
<50,000	15.1	%	2,185,649	28,385	77
Total	100.0	%	14,466,836	71,618	202


(1)	Excludes mortgage notes receivable, land held for development, construction in progress, corporate property and assets classified as held for sale.


(2)	The average lease size in the multi-tenant properties is 4,909 square feet.





HEALTHCARE REALTY 13		2Q 2016 SUPPLEMENTAL INFORMATION

Occupancy Information ⁽¹⁾

^{(dollars in thousands)}



OCCUPANCY
						2016		2015
	Investment at 6/30/2016		Square Feet at 6/30/2016	Q2		Q1		Q4		Q3		Q2
Multi-Tenant
Same store properties		$2,284,072	10,252,590	87.8	%	87.9	%	87.6	%	87.4	%	87.4	%
Acquisitions	331,992		921,069	95.0	%	91.8	%	89.7	%	89.9	%	90.7	%
Development completions ⁽²⁾	4,817		12,958	15.2	%	N/A		N/A		N/A		N/A
Reposition ⁽³⁾	153,878		995,472	57.0	%	56.5	%	56.7	%	51.4	%	50.7	%
Total		$2,774,759	12,182,089	85.7	%	85.6	%	85.3	%	84.2	%	84.2	%

Single-Tenant Net lease
Same store properties		$673,865	2,284,747	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Total		$673,865	2,284,747	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%

Total
Same store properties		$2,957,937	12,537,337	90.0	%	90.0	%	89.8	%	89.6	%	89.5	%
Acquisitions	331,992		921,069	95.0	%	93.3	%	91.4	%	91.7	%	93.0	%
Development completions ⁽²⁾	4,817		12,958	15.2	%	N/A		N/A		N/A		N/A
Reposition ⁽³⁾	153,878		995,472	57.0	%	56.5	%	56.7	%	51.4	%	50.7	%
Total		$3,448,624	14,466,836	88.0	%	87.9	%	87.6	%	86.8	%	86.7	%

# of Properties
Same store properties				169		166		166		160		159
Acquisitions				15		16		16		17		18
Development completions ⁽²⁾				1		N/A		N/A		N/A		N/A
Reposition ⁽³⁾				17		17		16		18		19
Total				202		199		198		195		196


(1)	Excludes mortgage notes receivable, land held for development, construction in progress, corporate property and assets classified as held for sale.


(2)	Development completions consist of one property that was completed in April 2016 and is currently 100% leased.


(3)	Reposition includes properties that are not stabilized based on specific criteria that are further discussed in the Company's Form 10-Q.





HEALTHCARE REALTY 14		2Q 2016 SUPPLEMENTAL INFORMATION

Same Store Properties

(dollars in thousands)



QUARTERLY ⁽¹⁾
	Q2 2016		Q1 2016		Q4 2015		Q3 2015		Q2 2015		Q1 2015		Q4 2014		Q3 2014
Multi-tenant
Revenues	$72,982		$71,943		$71,764		$70,490		$69,652		$68,981		$68,389		$67,861
Expenses	30,620		30,140		32,218		30,778		29,557		29,965		29,658		30,647
NOI	$42,362		$41,803		$39,546		$39,712		$40,095		$39,016		$38,731		$37,214
Occupancy	87.8	%	87.9	%	87.7	%	87.3	%	87.6	%	87.2	%	87.3	%	87.2	%
Number of properties	135		135		135		135		135		135		135		135

Single-tenant net lease
Revenues	$16,457		$16,529		$16,518		$16,451		$16,345		$16,370		$16,167		$15,891
Expenses	389		456		481		419		396		395		434		360
NOI	$16,068		$16,073		$16,037		$16,032		$15,949		$15,975		$15,733		$15,531
Occupancy	100.0	%	100.0	%	100.0	%	100.0	%	98.4	%	98.4	%	98.4	%	89.7	%
Number of properties	34		34		34		34		34		34		34		34

Total
Revenues	$89,439		$88,472		$88,282		$86,941		$85,997		$85,351		$84,556		$83,752
Expenses	31,009		30,596		32,699		31,197		29,953		30,360		30,092		31,007
Same Store NOI	$58,430		$57,876		$55,583		$55,744		$56,044		$54,991		$54,464		$52,745
Occupancy	90.0	%	90.1	%	90.0	%	89.6	%	89.9	%	89.5	%	89.3	%	89.2	%
Number of properties	169		169		169		169		169		169		169		169
% NOI year-over-year growth	4.3	%	5.2	%	2.1	%	5.7	%



TRAILING TWELVE MONTHS ⁽¹⁾
	Twelve Months Ended June 30,
	2016		2015		% Change
Multi-tenant
Revenues	$287,179		$274,883		4.5	%
Expenses	$123,756		$119,827		3.3	%
NOI	$163,423		$155,056		5.4	%
Revenue per average occupied square foot	$31.96		$30.76		3.9	%
Average occupancy	87.6	%	87.2	%
Number of properties	135		135

Single-tenant net lease
Revenues	$65,955		$64,773		1.8	%
Expenses	$1,745		$1,585		10.1	%
NOI	$64,210		$63,188		1.6	%
Revenue per average occupied square foot	$28.87		$28.62		0.9	%
Average occupancy	100.0	%	99.0	%
Number of properties	34		34

Total
Revenues	$353,134		$339,656		4.0	%
Expenses	$125,501		$121,412		3.4	%
Same Store NOI	$227,633		$218,244		4.3	%
Revenue per average occupied square foot	$31.33		$30.33		3.3	%
Average occupancy	89.9	%	89.3	%
Number of Properties	169		169


(1)	Excludes recently acquired or disposed properties, mortgage notes receivable, development conversions, construction in progress, land held for development, corporate property, reposition properties and assets classified as held for sale.





HEALTHCARE REALTY 15		2Q 2016 SUPPLEMENTAL INFORMATION

Reconciliation of NOI

(dollars in thousands)



QUARTERLY
	Q2 2016			Q1 2016			Q4 2015			Q3 2015			Q2 2015			Q1 2015			Q4 2014			Q3 2014
Rental income^(a)		$101,472			$98,740			$97,466			$95,383			$95,450			$95,034			$93,648			$92,095
Property lease guaranty revenue ^(b)	885			1,002			851			999			937			1,102			1,029			1,100
Exclude straight-line rent revenue	(2,091		)	(2,132		)	(1,929		)	(2,309		)	(2,475		)	(2,832		)	(3,122		)	(3,046		)
Revenue	100,266			97,610			96,388			94,073			93,912			93,304			91,555			90,149
Property operating expense	(36,263		)	(35,406		)	(36,758		)	(35,247		)	(33,927		)	(34,263		)	(33,386		)	(34,204		)
NOI		$64,003			$62,204			$59,630			$58,826			$59,985			$59,041			$58,169			$55,945
Less:
Acquisitions / Development completions	(4,696		)	(3,545		)	(3,132		)	(2,088		)	(1,617		)	(1,630		)	(791		)	(258		)
Reposition	(957		)	(881		)	(1,006		)	(885		)	(820		)	(863		)	(1,332		)	(1,194		)
Dispositions / other	80			98			91			(109		)	(1,504		)	(1,557		)	(1,582		)	(1,748		)
Same store NOI		$58,430			$57,876			$55,583			$55,744			$56,044			$54,991			$54,464			$52,745

(a) Rental income reconciliation:
Property operating		$83,283			$80,501			$79,466			$76,960			$75,470			$74,654			$73,153			$71,847
Single-tenant net lease	16,098			16,107			16,071			16,114			17,505			17,548			17,373			17,202
Straight-line rent	2,091			2,132			1,929			2,309			2,475			2,832			3,122			3,046
Total consolidated rental income		$101,472			$98,740			$97,466			$95,383			$95,450			$95,034			$93,648			$92,095

(b) Other operating income reconciliation:
Property lease guaranty revenue		$885			$1,002			$851			$999			$937			$1,102			$1,029			$1,100
Interest income	115			123			123			144			156			157			163			246
Other	170			156			142			170			134			132			128			128
Total consolidated other operating income		$1,170			$1,281			$1,116			$1,313			$1,227			$1,391			$1,320			$1,474



TRAILING TWELVE MONTHS
	Twelve Months Ended June 30,
	2016	2015	% Change
Same store NOI	$227,633	$218,244	4.3	%
Reposition	3,729	4,209	(11.4	)%
Subtotal	$231,362	$222,453	4.0	%
Acquisitions / Development completions	13,461	4,296	213.3	%
Dispositions / other	(160)	6,391	(102.5	)%
NOI	$244,663	$233,140	4.9	%





HEALTHCARE REALTY 16		2Q 2016 SUPPLEMENTAL INFORMATION

Same Store Leasing Statistics ⁽¹⁾




			2016								2015		2014
	Q2		Q1		Q4		Q3		Q2		Q1		Q4		Q3
Contractual rent increases occurring in the quarter
Multi-tenant properties	2.9	%	2.9	%	3.0	%	2.9	%	3.1	%	3.0	%	2.9	%	3.0	%
Single-tenant net lease properties	2.2	%	1.0	%	1.6	%	2.6	%	2.2	%	0.7	%	6.9	%	3.5	%
Total	2.7	%	2.5	%	2.8	%	2.8	%	2.9	%	2.6	%	4.0	%	3.1	%

Multi-tenant renewals
Cash leasing spreads	6.3	%	7.2	%	3.7	%	2.1	%	5.0	%	3.6	%	4.0	%	1.4	%
Tenant retention rate	81.2	%	87.2	%	91.2	%	82.4	%	87.3	%	83.1	%	88.6	%	85.9	%




	As of 6/30/2016
	Multi-tenant		Single-tenant Net Lease
Contractual Rental Rate Increases by Type
Annual increase
CPI	2.1	%	57.6	%
Fixed	83.5	%	26.6	%
Non-annual increase
CPI	2.2	%	5.3	%
Fixed	4.1	%	10.5	%
No increase
Term < 1 year	4.5	%	—	%
Term > 1 year	3.6	%	—	%

Tenant Type
Hospital	45.2	%	82.6	%
Physician and other	54.8	%	17.4	%

Lease Structure
Gross	16.7	%	—	%
Modified gross	29.5	%	—	%
Net	53.8	%	100.0	%

Ownership Type
Ground lease	64.3	%	11.5	%
Fee simple	35.7	%	88.5	%


(1)	Excludes recently acquired or disposed properties, mortgage notes receivable, construction in progress, land held for development, corporate property, reposition properties and assets classified as held for sale.





HEALTHCARE REALTY 17		2Q 2016 SUPPLEMENTAL INFORMATION

Components of Net Asset Value

(dollars in thousands)




Asset Type	Q2 2016 Same Store NOI⁽¹⁾	Q2 2016 Acquisitions/Development Completions NOI ⁽²⁾	Q2 2016 Reposition NOI⁽³⁾	Timing Adjustments⁽⁴⁾	Q2 2016 Adjusted NOI	Annualized Adjusted NOI	% of Adjusted NOI
MOB / Outpatient	$47,395	$4,696	$1,048	$822	$53,961	$215,844	82.9	%
Inpatient rehab	4,774	—	—	—	4,774	19,096	7.3	%
Inpatient surgical	4,435	—	—	—	4,435	17,740	6.8	%
Other	1,826	—	96	—	1,922	7,688	3.0	%
Total NOI	$58,430	$4,696	$1,144	$822	$65,092	$260,368	100.0	%

TOTAL SHARES OUTSTANDING (AS OF JUNE 30, 2016) 106,662,262

TOTAL SHARES OUTSTANDING (AS OF JULY 29, 2016) 115,862,407



DEVELOPMENT PROPERTIES
	Land held for development		$17,438
	Construction in progress	35,174
	Subtotal		$52,612

OTHER ASSETS
	Assets held for sale⁽⁵⁾		$702
	Reposition properties (net book value)⁽³⁾	8,595
	Cash and other assets⁽⁶⁾	88,985
	Subtotal		$98,282


DEBT
	Unsecured credit facility		$190,000
	Unsecured term loan	200,000
	Senior notes	900,000
	Mortgage notes payable	132,881
	Other liabilities⁽⁷⁾	81,233
	Subtotal		$1,504,114


(1)	See Same Store Properties schedule on page 14 for details on same store NOI.


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

(3)

Reposition properties includes 17 properties which comprise 995,472 square feet. The NOI table above includes 11 of these properties comprising 810,492 square feet that have generated positive NOI totaling approximately $1.1 million. The remaining 6 properties, comprising 184,980 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 table above.


(4)	Timing adjustments related to current quarter acquisitions and the difference between leased and occupied square feet on previous developments.


(5)	Assets held for sale includes one real estate property that is excluded from same store NOI and reflects net book value.


(6)	Includes cash of $9.0 million and other assets of $80.0 million that are expected to generate future cash or NOI and assets that are currently causing non-cash reductions to NOI. Other assets include prepaid assets of $63.1 million and above-market intangible assets (net) of $16.9 million.


(7)	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 $70.4 million, security deposits of $6.7 million, market-rate lease intangibles of $3.5 million, and deferred operating expense reimbursements of $0.6 million. Also, excludes deferred revenue of $35.6 million.





HEALTHCARE REALTY 18		2Q 2016 SUPPLEMENTAL INFORMATION

Components of Expected 2016 FFO

(dollars in thousands, except per square foot data)



SAME STORE QUARTERLY RANGE OF EXPECTATIONS
	Low			High
Occupancy
Multi-Tenant	87.5		%	89.0		%
Single-Tenant Net Lease	100.0		%	100.0		%

TTM Revenue per Occupied Square Foot ⁽¹⁾
Multi-Tenant		$31.00			$33.00
Single-Tenant Net Lease		$28.00			$29.00

Multi-Tenant TTM NOI Margin⁽¹⁾	56.0		%	58.0		%

Multi-Tenant Contractual Rent Increases by Type (% of SF)
Annual Increase	80.0		%	90.0		%
Non-annual Increase	6.0		%	8.0		%
No Increase (term < 1 year)	4.0		%	6.0		%
No Increase (term > 1 year)	3.0		%	5.0		%

Contractual Increases Occurring in the Quarter
Multi-Tenant	2.8		%	3.0		%
Single-Tenant Net Lease	1.0		%	3.0		%

Multi-Tenant Cash Leasing Spreads	3.0		%	6.5		%

Multi-Tenant Lease Retention Rate	75.0		%	90.0		%

TTM NOI Growth ⁽¹⁾
Multi-Tenant ⁽²⁾	4.5		%	6.5		%
Single-Tenant Net Lease	1.0		%	3.0		%

ANNUAL RANGE OF EXPECTATIONS
	Low			High

Normalized G&A ⁽³⁾	$30,500			$32,500

Funding Activity
Acquisitions	$200,000			$250,000
Dispositions	(50,000)			(75,000)
Development	15,000			25,000
Redevelopment	28,000			33,000
1st Generation Tenant Improvements	10,000			15,000
2nd Generation Tenant Improvements	12,000			18,000
Leasing Commissions	4,000			8,000
Capital Additions
Revenue enhancing	6,000			10,000
Routine and non-revenue enhancing	8,000			12,000

Cash Yield
Acquisitions	5.50		%	6.00		%
Dispositions	7.50		%	8.50		%
Development (stabilized)	6.75		%	8.00		%
Redevelopment (stabilized)	7.50		%	8.50		%

Leverage (Debt/Cap)	32.0		%	36.0		%


(1)	TTM = Trailing Twelve Months


(2)	Long-term same store NOI Growth, excluding changes in occupancy, is expected to range between 2% and 4%.


(3)	Normalized G&A excludes acquisition expenses and includes amortization of non-cash share-based compensation awards of $7.4 million inclusive of $2.4 million related to 2015 performance awards.





HEALTHCARE REALTY 19		2Q 2016 SUPPLEMENTAL INFORMATION

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