Community Healthcare Trust Inc
Community Healthcare Trust Inc. is a self-administered healthcare REIT that owns and leases properties used by hospitals, physicians, healthcare systems, and other healthcare service providers. Its portfolio is built through small to mid-sized acquisitions, often off-market or via sale-leaseback transactions, with an emphasis on long-term, contract-based rental income from need-based healthcare real estate.
Fiscal year 2025 · change from previous year
Development 2020–2025
Business
Share of revenueLong-term leases on properties used for medical and healthcare delivery.
Acquisition of healthcare facilities, often through off-market or lightly marketed deals.
Capital invested to refurbish, reposition, or convert healthcare buildings for new uses.
Ancillary income including notes receivable and other contractual property-related items.
Customers
The company’s customers are healthcare operators that need specialized real estate rather than general office space. These include hospitals, physician groups, healthcare systems, dialysis providers, behavioral health operators, and rehabilitation-focused tenants that value long-duration leases and facility-specific layouts. Demand is driven by providers seeking capital-efficient occupancy through sale-leasebacks or expansion into targeted submarkets.
Lease hospitals and system-affiliated facilities to support clinical operations and long-term occupancy needs.
Lease medical office and clinic space for routine care, diagnostics, and specialty practices.
Lease specialty facilities for inpatient behavioral care and rehabilitation services.
Lease dialysis, surgical, and other niche healthcare buildings tailored to service delivery.
Sell properties to the REIT and remain as tenants to raise capital while preserving operating control.
Strategy
The company is focused on growing through disciplined acquisitions of smaller healthcare properties, typically in the $3 million to $30 million range, where it believes competition is lower and pricing is more attractive. It also seeks to deepen relationships with healthcare providers and use sale-leasebacks, OP units, and selective redevelopment to expand the portfolio while keeping leases long-dated and cash flows predictable.
Small, off-market deals can improve returns and reduce auction competition.
Diversification across tenants, facility types, and states reduces concentration risk.
Deep provider and intermediary relationships create proprietary acquisition flow.
Redevelopment can reposition assets and asset sales can fund new investments.
Geography
The portfolio is spread across 36 U.S. states, which reduces reliance on any single local market but still leaves the company exposed to state-level healthcare and real estate conditions. Texas and Florida are the largest concentrations, together representing 26.7% of annualized rent as of December 31, 2025, so performance in those markets matters disproportionately. The company’s acquisition strategy targets submarkets rather than major urban cores, which shapes both tenant mix and competitive dynamics.
Risks
The business is exposed to tenant credit risk, because rent depends on healthcare operators that are themselves affected by reimbursement, regulation, and operating performance. It also faces concentration risk in healthcare real estate and in states such as Texas and Florida, while leverage, interest rates, and acquisition execution can affect growth and dividend capacity.
- Tenant credit deteriorationImpact: HighLikelihood: Medium
Rental income depends on healthcare operators remaining solvent and current on lease payments.
Exposure: Largest tenants include US Healthvest and Lifepoint Health; no tenant exceeds 10% of annualized rent.
- Healthcare regulation and reimbursement changesImpact: HighLikelihood: Medium
Operators may face lower margins or licensure issues, which can impair their ability to pay rent.
Exposure: Behavioral, hospital, and specialty care tenants are especially sensitive to reimbursement and licensing.
- Geographic concentrationImpact: MediumLikelihood: Medium
A meaningful share of rent comes from Texas and Florida, so local downturns could affect results.
Exposure: Texas 14.3% and Florida 12.4% of annualized rent.
- Acquisition execution riskImpact: MediumLikelihood: Medium
Growth depends on sourcing and closing accretive healthcare property deals at acceptable prices.
Exposure: Targeted off-market transactions may be harder to source consistently.
- Interest rate and leverage riskImpact: MediumLikelihood: Medium
Higher borrowing costs can reduce acquisition returns and pressure dividend coverage.
Exposure
Accounting
Judgemental itemsReported revenue depends on when leases commence and how reimbursements are billed under contractual arrangements.
Impact: A lease starting later can defer real estate revenue recognition.
The company noted a 2025 behavioral specialty facility was initially accounted for as financing until lease commencement.
Impact: Can shift amounts between other assets, real estate properties, and income timing.
Management must test properties for recoverability when occupancy, lease terms, or market conditions weaken.
Impact: Could create non-cash impairment charges on real estate assets.
A 2025 reserve was recorded against notes receivable tied to a behavioral hospital tenant.
Impact: Directly reduces earnings and signals tenant-specific credit stress.
The company had significant commitments for tenant improvements and capital projects at year-end 2025.
Impact: Affects future cash outflows and may change asset basis and depreciation.
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Last updated: 24/09/2026