Q4 2016 Real-Time Call Brief

Highlights

We delivered 16% total returns to shareholders, outperforming the S&P 500 and the REIT and healthcare REIT indices.

Our 17 year compound annual return to shareholders is an exceptional 25%.

During the year, we grew normalized FFO per share by 5% at the high-end of the guidance range we presented at the beginning of 2016.

We made or committed to investments of nearly $2 billion, including our exciting and accretive $1.5 billion acquisition of high-quality, new life sciences and innovation center portfolio affiliated with leading universities, academic medical centers and research institutions.

This deal is a winner, with great yield approaching 7%, attract real-estate, long-term leases with institutional quality tenants and the leading developer partner in Wexford.

We also delivered reliable income growth to our shareholders by increasing our dividend by 6%.

To fund our business, we once again demonstrated excellence in capital markets by completing over $2 billion in highly attractive, long-term senior notes and equity offerings.

We also generated additional funding sources by accelerating our capital recycling and portfolio optimization plans receiving over $600 million in profitable loan repayments and disposition proceeds from non-strategic assets.

Key among these agreements is a $700 million net debt position deal, we have reached with Kindred to enable Kindred to exit it's skilled nursing segment at a very favorable cash rent yield to Ventas of 7%.

We also delivered an innovative capital solution to our partners Ardent and Sam Zell's EGI to fund their funding acquisition of high-quality Acute Care Provider LHP and scale the Ardent platform into a $3 billion revenue company operating in six states.

Specifically, our own portfolio generates 93% of it's revenue from private-pay sources.

Our SHOP portfolio represents approximately 30% of our net operating income.

Our attractive life science and medical office building segment generates about 25% of our NOI.

Our triple-net leases representing 42% of our NOI, have virtually not lease escalations through the end of 2018, and none of out tenants represent more than 10% of our NOI.

At the end of this year, we expect to generate only 1% of our NOI from skilled nursing facility.

So while we may experienced near term challenges from picking deliveries of senior living units in 2017 or potential changes to affordable care at, the opportunities in our $1 trillion fragmented market are unmistakable, inexorable and gigantic.

Our overall same-store cash NOI increased 2.7% for the full year 2016 right in line with our 2.5% to 3% total company same-store guidance range.

Our fourth quarter same-store NOI growth of 2.9% was also right in line with our expectations.

Starting with our triple-net business, which accounts for 42% of our NOI.

Our triple-net portfolio grew same-store cash NOI by an excellent 3.7% for the full year 2016 over 2015.

In the fourth quarter, triple-net same-store cash NOI increased by 4.5% driven principally by strong in place lease escalations, and rent we allocated to more productive assets from the Kindred LTAC lease modification agreement in Q2.

Cash flow coverage in our overall stabilize to triple-net lease portfolio for the third quarter of 2016, the latest available information was consistent with quarter at 1.7 times.

Coverage in our triple-net same-store senior housing portfolio remained at 1.3 times, incorporating escalator growth for the trailing 12-months that exceeded 3%.

Coverage trends and senior housing were supported by low single-digit EBITDARM growth at the asset level for the trailing 12-months.

Cash flow coverage in our same-store post acute portfolio was 1.8 times.

We expect that the spin-off in Kindred disposals will together achieve highly attractive blended cap rate approximating 7% and will reduce our exposure to the skilled nursing space to only 1% of Ventas's NOI.

Specialty Hospital coverage declined by 10 basis points to 1.9 times, in line with our expectation as Kindred entered the new LTAC patient criteria in the third quarter.

Rent coverage at the assets improved 10 basis points sequentially to a very strong 3.1 times in Q3.

For 2017, we expect our triple-net portfolio overall will grow in the range of 2.5% to 3.5%, driven by more normalized in place lease escalations in the year.

Our same-store SHOP cash NOI increased by 2.3% for the full year 2016, and grew over 1% in the fourth quarter, both right in line with our expectations.

In both the fourth quarter and full year 2016, RevPOR increased at approximately 4% overall, driven by our high barrier to entry, cost of markets, where we have attractive pricing power.

Labor cost increases driven by wage pressure pressures exceeded 5% in 2016.

These increases were partially tempered by the benefit of $2 million in lower Sunrise management fees in the second half of the year.

Our premier coastal markets in the U.S.

such as New York, Los Angeles and Boston provided the engine room of growth for our overall SHOP portfolio in the fourth quarter and for the full year.

These high-quality infill communities represent 70% of our SHOP NOI and for the fourth quarter and full year these communities increase same-store NOI mid single-digits on strong rate and revenue growth.

Canada also delivered very strong performance increasing NOI by nearly 7% in the fourth quarter and 5% for the full year.

Our NOI exposure in markets with a new supply surplus continues to represent 30% of our SHOP portfolio, or less than 10% of Ventas's overall NOI.

Our same-store NOI performance in the fourth quarter in these communities decelerated to a mid single-digit decline, via occupancy pressure.

Net-net, the 70% of our portfolio in high barrier markets powered same-store NOI growth overall both in the fourth quarter and for the full year.

Turning to 2017.

We expect the SHOP portfolio to grow same-store NOI in 2017 in the range of 0% to 2%.

Given over 70% of annual SHOP revenue is determine by these rate ladders they are extremely important to our full year SHOP profit delivery.

The accelerated level of pricing is also important to allow the continued labor wage pressure, which we estimate will approximate 4% to 5% for our SHOP portfolio overall in 2017.

The 30% of our SHOP portfolio with the supply surplus, we anticipate mid to high single-digit NOI declines, a deceleration due to the cumulative impact of new units online.

That said, new construction as a percentage of inventory within our trade areas has held steady at 5% overall over the last several quarters and we are seeing early signs that suggest new starts maybe slowing.

Encouragingly, the 70% of our portfolio located at high barrier markets are expected to continue to driving mid single-digit NOI growth in 2017.

We continue to invest in attractive high returned, redevelopment projects this advantage markets, with six new projects totaling $70 million now underway, to help fuel our growth over the medium and long-term.

Let's turn it out the portfolio review with our office operations reporting segment, which include their medical office business as well as our newly acquired lifescience and innovation centers.

Taking together these assets now represents approximately 25% of Ventas's annualized NOI.

The 23 operating assets acquired through our lifescience investment, which closed in September 2016, performed very well in the fourth quarter.

We expect two properties to come online late in 2017 In our medical office business, cash NOI for the full year 2016, same-store pool 270 assets increased by 1.3% in line with guidance.

In the fourth quarter, same-store NOI increased 2.1%.

On a sequential basis, as expected, we made progress in the fourth quarter in growing occupancy with sequential occupancy increasing by 40 basis points to 92%.

Looking ahead to 2017, we expect stable and steady growth of 1% to 2% from our same-store office portfolio of 364 medical office assets.

Income from continuing operations per share for 2016 grew 36%, to $1.59 compared to 2015.

Full year 2016 normalized FFO totaled $4.13 per fully diluted share, representing a 5% growth on a comparable basis over 2015.

We closed on $1.6 billion in acquisitions in 2016, including our acquisition of 23 high-quality lifescience and innovation centers.

We also invested over $140 million in high return redevelopment and development projects in 2016.

Ventas sold properties and received final repayment on loans receivable for proceeds totaling nearly $620 million at a gain of $100 million, and with 8% cash in GAAP yields.

These proceeds outpaced our previous guidance of $500 million, including approximately $350 million in proceeds realized late in the fourth quarter.

We demonstrated capital market excellence by issuing $1.3 billion in equity over the course of the year at an average growth price $70 per share.

We also raised $850 million of new senior notes, including our most attractive 10 year bond in Ventas's history within all in rate below 3.25%.

Meanwhile, we retired or refinanced approximately $1 billion of in place debt yielding approximately 2.3% on a GAAP basis.

At year-end the company's net debt to adjusted EBITDA improved to 5.7 times, a 0.4 times reduction from our year-end 2015 leverage of 6.1 times.

Our fixed charge coverage grew to an exceptional 4.8 times.

Our net debt to gross asset value improved by four percentage points to 38%.

Our secured debt to total indebtedness reached to 6%.

Our expectations as we begin the year, as for 2017 income from continuing operations to range between $1.72 and $1.78 per fully diluted shares.

We expect normalized FFO per share to range from $4.12 to $4.18.

We expect the total Ventas same-store portfolio to grow cash NOI by 1.5% to 2.5% with all segments contributing to growth.

We expect our ongoing capital recycling program to generate $900 million in disposition proceeds at a 7% to 8% GAAP yield.

This includes $700 million in proceeds at a gain approximating $670 million in the second half of the year through the potential sale of 36 skilled nursing facilities.

Disposition proceeds are expected to be redeployed at approximately the same rate into new 2017 investments approximating $1 billion.

Principally the scale our lifesciences and acute care platforms including $700 million in secured debt financing to fund Ardent's acquisition of LHP.

We also expect to invest in future growth through attractive new ground up lifesciences developments.

With our development and redevelopment funding expected to accelerate to approximately $300 million in 2017.

A note on quarterly phasing, we expect softer first quarter sequentially in 2017 to the nearly $350 million in late Q4 2016 dispositions.

We plann to drive an even stronger financial profile and liquidity in 2017, including refinancing approximately $1 billion of low cost short duration debt, with longer dated notes.

Our outlook assumes 358 million weighted average shares in 2017 compared to 348 million shares outstanding in 2016.