NHI first-quarter normalized FFO increases to $17.17M, net income to $15.94M

National Health Investors, Inc. (NYSE:NHI) announced today its normalized Funds From Operations ("FFO") and net income for the three months ended March 31, 2010.

First Quarter Highlights

• Normalized FFO improved to $0.62 per basic and diluted common share compared with $0.55 in the same period of 2009, an increase of 12.7% per share
• FFO increased 8.4% compared with the same period in 2009
• Completed real estate and mortgage loan investments totaling $104.1 million involving nine skilled nursing facilities, five assisted living facilities and one acute psychiatric hospital

Financial Results

Normalized FFO for the three months ended March 31, 2010, was $17,174,000, or $0.62 per basic and diluted common share, compared with $15,098,000, or $0.55 per basic and diluted common share, for the same period in 2009.

FFO, as defined by the National Association of Real Estate Investment Trusts ("NAREIT"), for the three months ended March 31, 2010, was $18,404,000, or $0.66 per diluted common share, compared with $16,978,000, or $0.62 per basic and diluted common share, for the same period in 2009. Net income for the three months ended March 31, 2010, was $15,943,000, or $0.58 per basic and diluted common share, respectively, compared with net income of $15,049,000, or $0.55 per basic and diluted common share, respectively, for the same period in 2009.

Investment Activity

In February 2010, the Company completed the purchase of six Florida skilled nursing facilities totaling 780 beds from Care Foundation of America, Inc. for $67,000,000. The facilities are leased to affiliates of Health Services Management, Inc. for $6,200,000 annually, plus a 3% annual escalator beginning October 1, 2011. The lease expires in 2014 and the tenant has a 3-year optional renewal term.

In March 2010, the Company completed a $12,500,000 purchase/leaseback transaction involving a 66-bed acute psychiatric hospital in La Mesa, California that is leased to Helix Healthcare for a term of 15 years at an initial lease payment of $1,500,000 plus annual fixed escalators and completed a $21,400,000 purchase/leaseback transaction involving four assisted living and memory care facilities totaling 126 units in Minnesota that are leased to Suite Living Senior Specialty Services for a term of 15 years at an initial lease payment of $2,140,000 plus annual fixed escalators. The Company also made second mortgage loans of $3,200,000 secured by three skilled nursing facilities and one assisted living facility totaling 387 beds that include terms of five years and fixed interest rates from 12% to 14%.

2010 Guidance

The Company currently forecasts an increase in normalized FFO for 2010 from 15.0% to 17.2% compared with 2009. The Company's guidance range for the full year 2010 for EPS, FFO and Normalized FFO per share, with underlying assumptions and timing of certain transactions, is set forth and reconciled below:

Following are current assumptions reflected in the company's full-year 2010 guidance for the low and high end of the guidance range:

• Additional investments of $30 million in the second half of the year (assumed for both low and high end).
• Existing and future investments are funded through borrowings on the revolving credit facility (assumed for the high end).
• New debt financings of $100 million to $125 million to fund existing and future investments (assumed for the low end).
• Corporate G&A expenses of $8.4 million to $9.0 million (assumed for both low and high end).

The Company's guidance range reflects the existence of volatile economic conditions, but does not assume any material deterioration in tenant credit quality and/or performance of its portfolio. The guidance is based on a number of assumptions, many of which are outside the Company's control and all of which are subject to change. The Company's guidance may change if actual results vary from these assumptions.