Healthcare Realty Trust Incorporated

Technology infrastructure · Technology systems and infrastructure failure

A security breach or other significant disruption involving the Company's IT network and related systems could: disrupt the proper functioning of the Company's networks and systems and therefore the Company's operations and/or those of certain tenants; result in misstated financial reports, violations of loan covenants, missed reporting deadlines, and/or missed permitting deadlines; result in the Company's inability to properly monitor its compliance with the rules and regulations regarding the Company's qualification as a REIT.

Market and investment · Market volatility and economic cycles

The Company's real estate investments are illiquid and the Company may not be able to sell properties strategically targeted for disposition. Because real estate investments are relatively illiquid, the Company's ability to adjust its portfolio promptly in response to economic or other conditions is limited. Certain significant expenditures generally do not change in response to economic or other conditions, including debt service (if any), real estate taxes, and operating and maintenance costs.

Capital structure and performance · Dividend policy and capital allocation

The Company cannot assure you that it will be able to continue paying dividends at or above the rates previously paid. The stockholders of the Company may not receive dividends at the same rate they received previously for various reasons, including the following: (i) the Company may not have enough cash to pay such dividends due to changes in the Company's cash requirements, capital spending plans, cash flow or financial position; (ii) decisions on whether, when and in what amounts to make any future distributions will remain at all times entirely at the discretion of the Board of Directors.

Credit and liquidity · Access to capital and financing

The unavailability of equity and debt capital, volatility in the credit markets, increases in interest rates, or changes in the Company's debt ratings could have an adverse effect on the Company's ability to meet its debt payments, make dividend payments to stockholders or engage in acquisition and development activity. A REIT is required by the Internal Revenue Code of 1986, as amended (the Internal Revenue Code), to make dividend distributions, thereby retaining less of its capital for growth. As a result, a REIT typically requires new capital to invest in real estate assets.

Market and investment · Interest rate and yield curve risk

Increases in interest rates could have a material adverse effect on the Company's cost of capital. During 2025, the Federal Reserve mainly kept interest rates constant and in the latter part of the year actually decreased rates by a total of 75 basis points with the easing of inflation. However, if inflation climbs again, the Federal Reserve may again raise interest rates. Any increases in interest rates will increase interest costs on any new debt and existing variable rate debt.

Credit and liquidity · Banking relationships and credit facilities

If lenders under the Unsecured Credit Facility fail to meet their funding commitments, the Company's operations and consolidated financial position would be negatively impacted. Access to external capital on favorable terms is critical to the Company's success in growing and maintaining its portfolio. If financial institutions within the Unsecured Credit Facility were unwilling or unable to meet their respective funding commitments to the Company, any such failure would have a negative impact on the Company's operations, consolidated financial condition and ability to meet its obligations, including the payment of dividends to stockholders.

Capital structure and performance · Debt management and refinancing

The Company has incurred significant debt obligations and may incur additional debt and increase leverage in the future. As of December 31, 2025, the Company had approximately $4.1 billion of outstanding indebtedness excluding discounts, premiums and debt issuance costs. The Company has approximately $1.3 billion of combined debt maturities in 2026 and 2027. A high level of indebtedness would require the Company to dedicate a substantial portion of its cash flows from operations to service debt, thereby reducing the funds available to implement the Company's business strategy and to make distributions to stockholders.

Strategic execution · Strategic transformation and turnaround risks

The Company may make material acquisitions and undertake developments and redevelopments that may involve the expenditure of significant funds and may not perform in accordance with management's expectations. The Company's acquired, developed, redeveloped and existing real estate properties may not perform in accordance with management's expectations because of many factors including the following: The Company's purchase price for acquired facilities may be based upon a series of market or building-specific judgments which may be incorrect.

Strategic execution · Merger acquisition and divestiture risks

The Company may make material acquisitions and undertake developments and redevelopments that may involve the expenditure of significant funds and may not perform in accordance with management's expectations. Future acquisitions could require the Company to issue equity securities, incur debt or other contingent liabilities or amortize expenses related to other intangible assets, any of which could adversely impact the Company's consolidated financial condition or results of operations.

Customer and revenue · Reimbursement and pricing pressure healthcare or insurance

Trends in the healthcare service industry, including the impact of the One Big Beautiful Bill Act passed during 2025 that is subject of ongoing analysis, may negatively affect the demand for the Company's properties, lease revenues and the values of its investments. The healthcare service industry may be affected by the following: transition to value-based care and reimbursement of providers; pressure on providers' operating profit margins from lower reimbursement rates, lower admissions growth, and higher expense growth; regulatory and government reimbursement uncertainty related to the Medicare and Medicaid programs.

Customer and revenue · Customer concentration and key customer dependence

Many of the Company's leases are dependent on the viability of associated health systems. Revenue concentrations relating to these leases expose the Company to risks related to the financial condition of the associated health systems. Most of the Company's properties on or adjacent to hospital campuses are largely dependent on the viability of the health system's campus where they are located, whether or not the hospital or health system is a tenant in such properties.

Human capital and workforce · Talent acquisition and retention

The Company's success depends, in part, on its ability to attract and retain talented employees. The loss of any one of the Company's key personnel or the inability to maintain appropriate staffing could adversely impact the Company's business. The success of the Company's business depends, in part, on the leadership and performance of its executive and senior management team and key employees and the ability to maintain appropriate staffing levels across the Company. Rising labor costs, increased competition for talent, and a tight labor market may make it difficult for the Company to hire skilled and unskilled employees to meet staffing needs.

Core operations · Operational disruption and business continuity

If the Company is unable to promptly re-let its properties, if the rates upon such re-letting are significantly lower than the previous rates or if the Company is required to undertake significant expenditures or make significant leasing concessions to attract new tenants, then the Company's business, consolidated financial condition and results of operations would be adversely affected.

Supply chain and procurement · Geographic concentration of suppliers

The Company is exposed to risks associated with geographic concentration. As of December 31, 2025, the Company had investment concentrations of greater than 5% of its total investments in the Dallas, TX (9.5%), Seattle, WA (6.1%), Houston, TX (6.0%), and Charlotte, NC (5.4%) markets. These concentrations increase the exposure to adverse conditions that might affect these markets, including natural disasters, local economic conditions, local real estate market conditions, increased competition, state and local regulation (including property taxes) and other localized events or conditions.

Corporate governance · Internal controls and risk management

A security breach or other significant disruption involving the Company's IT network and related systems could: result in the Company's inability to properly monitor its compliance with the rules and regulations regarding the Company's qualification as a REIT; result in loss, theft, or misappropriation of Company funds, or funds held by tenants or other parties.

Economic and market conditions · Inflation and deflation pressures

The Company has, and in the future may have more exposure to fixed rent escalators, which could lag behind inflation and the growth in operating expenses such as real estate taxes, utilities, insurance, and maintenance expense. Approximately 96% of leases have increases that are based upon fixed percentages and approximately 4% of leases have increases based on the Consumer Price Index. To the extent fixed percentage increases lag behind inflation and operating expense growth, the Company's performance, growth, and profitability would be negatively impacted.

Natural and catastrophic events · Natural disasters and extreme weather

Damage from catastrophic weather and other natural events, whether caused by climate change or otherwise, could result in losses to the Company. Many of our properties are located in areas susceptible to revenue loss, cost increase, or damage caused by severe weather conditions or natural disasters such as wildfires, hurricanes, earthquakes, tornadoes and floods. The Company could experience losses to the extent that such damages exceed insurance coverage, cause an increase in insurance premiums, and/or a decrease in demand for properties located in such areas.

Natural and catastrophic events · Pandemic and public health crises

Pandemics and measures intended to prevent their spread or mitigate their severity could have a material adverse effect on the Company's business, results of operations, cash flows and financial condition. Pandemics can have repercussions across regional and global economies and financial markets. For example, during the COVID-19 pandemic, all of the states and cities in which the Company owns properties, manages properties, and/or has development or redevelopment projects instituted quarantines, restrictions on travel, shelter in place rules, restrictions on the types of businesses that may continue to operate.

Industry regulation · Safety and environmental regulations

The costs of complying with governmental laws and regulations may adversely affect the Company's results of operations. All real property and the operations conducted on real property are subject to federal, state, and local laws and regulations relating to environmental protection and human health and safety. Some of these laws and regulations may impose joint and several liability on tenants, owners, or operators for the costs to investigate or remediate contaminated properties, regardless of fault or whether the acts causing the contamination were legal.

Tax and financial reporting · Financial reporting and accounting standards

The Company's expected results may not be achieved, and actual results may differ materially from expectations. This may be the result of various factors, including, but not limited to: changes in the economy; the availability and cost of capital at favorable rates; increases in property taxes, utilities and other operating expenses; changes to facility-related healthcare regulations; changes in rules or practices governing the Company's financial reporting; and other financial, legal and operational matters.