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 UNITED
STATES

 SECURITIES
AND EXCHANGE COMMISSION

 Washington,
D.C. 20549

 FORM

 (Mark
One)

 ANNUAL
 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the fiscal year ended December 31, 2023

 or

 TRANSITION
 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the transition period from __________ to __________

 Commission
File No. 001-41628

FIELDS REIT, INC.

 (Exact
name of registrant as specified in its charter)

 Maryland

 84-2336054

 (State
 or other jurisdiction

 of
 incorporation or organization)

 (I.R.S.
 Employer

 Identification
 No.)

 6101
Nimtz Parkway, South Bend, IN 46628

 (Address
of principal executive offices, including Zip Code)

 Registrant's
telephone number, including area code: (574) 807-0800

 Securities
registered pursuant to Section 12(b) of the Act:

 Title
 of each class

 Trading
 Symbol(s)

 Name
 of each exchange on which registered

 Common
 stock

 Par
 value $0.0001 per share

 STRW

 NYSE
 American LLC

 Securities
registered pursuant to Section 12(g) of the Act:

 None

by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No

by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes No

by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files). Yes No

by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer,"
"smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 Large
 accelerated filer

 Accelerated
 filer

 Non-accelerated
 filer

 Smaller
 reporting company

 Emerging
 growth company

 If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report.

 If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.

by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).

by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Act.) Yes No

 The
aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which
the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's
most recently completed second fiscal quarter: $ 38,040,290

 As
of March 19, 2024, there were 6,474,175 shares of the registrant's common stock outstanding.

 DOCUMENTS
INCORPORATED BY REFERENCE

 Portions
of the registrant's Definitive Proxy Statement for the 2023 Annual Meeting of Shareholders (to be filed with the Securities and
Exchange Commission no later than 120 days after the end of the registrant's fiscal year end) are incorporated by reference in
this Annual Report on Form 10-K in response to Part II, Item 5 and Part III, Items 10, 11, 12, 13 and 14.

 TABLE
OF CONTENTS

 Item
 1.

 Business

 Item
 1A.

 Risk Factors

 Item
 1B.

 Unresolved Staff Comments

 Item
 1C.

 Cybersecurity

 Item
 2.

 Properties

 Item
 3.

 Legal Proceedings

 Item
 4.

 Mine Safety Disclosures

 Item
 5.

 Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Item
 6.

 [Reserved]

 Item
 7.

 Management's Discussion and Analysis of Financial Condition and Results of Operations

 Item
 7A.

 Quantitative and Qualitative Disclosures About Market Risk

 Item
 8.

 Financial Statements and Supplementary Data

 Item
 9.

 Changes in and Disagreements with Accountants on Accounting and Financial Disclosures

 Item
 9A.

 Controls and Procedures

 Item
 9B.

 Other Information

 Item
 9C.

 Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

 Item
 10.

 Directors, Executive Officers and Corporate Governance

 Item
 11.

 Executive Compensation

 Item
 12.

 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 Item
 13.

 Certain Relationships and Related Transactions, and Director Independence

 Item
 14.

 Principal Accountant Fees and Services

 Item
 15.

 Exhibit and Financial Statement Schedules

 Item
 16.

 Form 10-K Summary

 CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS

 Certain
statements in this Annual Report on Form 10-K are "forward-looking statements" within the meaning of the U.S. federal securities
laws. Forward-looking statements provide our current expectations or forecasts of future events and are not statements of historical
fact. This Form 10-K also contains forward-looking statements by third parties relating to market and industry data and forecasts; forecasts
and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other
forward-looking statements contained in this Form 10-K. These forward-looking statements include information about possible or assumed
future events, including, among other things, discussion and analysis of our future financial condition, results of operations, Funds
From Operations ("FFO"), our strategic plans and objectives, cost management, potential property acquisitions, anticipated
capital expenditures (and access to capital), amounts of anticipated cash distributions to our stockholders in the future and other matters.
Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks,"
"estimates" and variations of these words and other similar expressions are intended to identify forward-looking statements.
These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are
beyond our control, are difficult to predict and/or could cause actual results to differ materially from those expressed or forecasted
in the forward-looking statements.

 Forward-looking
statements involve inherent uncertainty and may ultimately prove to be incorrect or false. Readers are cautioned to not place undue reliance
on forward-looking statements. Except as otherwise may be required by law, we undertake no obligation to update or revise forward-looking
statements to reflect changed assumptions, the occurrence of unanticipated events or actual operating results. Our actual results could
differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited
to:

risks and uncertainties related to the national, state and local economies, particularly the economies of Arkansas, Illinois, Indiana,
Kentucky, Michigan, Ohio, Oklahoma, Tennessee and Texas, and the real estate and healthcare industries in general;

availability and terms of capital and financing;

the impact of existing and future healthcare reform legislation on our tenants, borrowers and guarantors;

adverse trends in the healthcare industry, including, but not limited to, changes relating to reimbursements available to our tenants
by government or private payors;

competition in long-term healthcare industry and shifts in the perception of various types of long-term care facilities, including skilled
nursing facilities;

the impact of COVID-19 on our business and the business of our tenants and operators, including without limitation, increased costs and
decreased occupancy levels experienced by operators of skilled nursing facilities;

our tenants' ability to make rent payments;

our dependence upon key personnel whose continued service is not guaranteed;

availability of appropriate acquisition opportunities and the failure to integrate successfully;

ability to source target-marketed deal flow;

ability to dispose of assets held for sale for the anticipated proceeds or on a timely basis, or to deploy the proceeds therefrom on
favorable terms;

fluctuations in mortgage and interest rates;

changes in the ratings of our debt securities;

risks and uncertainties associated with property ownership and development;

the potential need to fund improvements or other capital expenditures out of operating cash flow;

potential liability for uninsured losses and environmental liabilities;

the outcome of pending or future legal proceedings;

changes in tax laws and regulations affecting REITs;

our ability to maintain our qualification as a REIT; and

the effect of other factors affecting our business or the businesses of our operators that are beyond our or their control, including
natural disasters, other health crises or pandemics and governmental action; particularly in the healthcare industry.

 This
list of risks and uncertainties, however, is only a summary of some of the most important factors and is not intended to be exhaustive.
New risks and uncertainties may also emerge from time to time that could materially and adversely affect us.

 GLOSSARY
OF CERTAIN TERMS

 The
following is a glossary of certain terms used in this Form 10-K:

 "ADA"
means the Americans with Disabilities Act of 1990, as amended.

 "ALF"
means assisted living facility.

 "Affordable
Care Act" means the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act
of 2010.

 "BVI
Company" means Strawberry Fields REIT, Ltd., a company organized under the laws of the British Virgin Islands. Upon the consummation
of the formation transactions, the BVI Company became a wholly-owned subsidiary of the Operating Partnership.

 "CAGR"
means compound annual growth rate.

 "Capitalization
rate" means the ratio of a property's operating income to its purchase price.

 "CMS"
means the Centers for Medicare and Medicaid Services, which administers Medicare, Medicaid and the State Children's Health Insurance
Program.

 "Company"
means Strawberry Fields REIT, Inc., a Maryland corporation.

 "Dollars"
or "$" means United States dollars.

 "EBITDA"
means earnings before interest, taxes, depreciation and amortization.

 "EBITDAR"
means earnings before interest, taxes, depreciation, amortization and rent.

 "EBITDARM"
means earnings before interest, taxes, depreciation, amortization, rent and management fees.

 "GLA"
or "gross leasable area" or means the area in any building that may be leased to tenants.

 "HHS"
means the U.S. Department of Health and Human Services.

 "HIPAA"
means the Health Insurance Portability and Accountability Act of 1996, as amended.

 "HITECH
Act" means the Health Information Technology for Economic and Clinical Health Act.

 "HUD"
means the U.S. Department of Housing and Urban Development, the federal government agency for housing and urban development.

 "long-term
acute care hospital" or "LTACH" means medical institutions in which patients requiring prolonged hospitalization (but
who are stable) are given medical care and rehabilitation for several weeks. The operation of these institutions is subject to receipt
of a suitable license.

 "NIS"
means New Israeli Shekels.

 "Operating
Partnership" means Strawberry Fields Realty LP, a Delaware limited partnership.

 "OP
units" means the units of limited partnership interests in the Operating Partnership.

 "Predecessor
Company" means Strawberry Fields REIT, LLC, an Indiana limited liability company. Prior to the consummation of the formation transactions,
the Predecessor Company was the indirect owner of 73 of our properties.

 "SNF"
means a skilled nursing facility.

 "Series
A Bonds" means the Series A Bonds issued by the BVI Company, which were first offered to the public in Israel in 2015. The Series
A Bonds were repaid in full during the year ended December 31, 2023.

 "Series
C Bonds" means the Series C Bonds issued by the BVI Company, which were first offered to the public in Israel on July 28, 2021.
As of December 31, 2023, the Series C Bonds had an outstanding principal balance of approximately $60.8 million.

 "Series
D Bonds" means the Series D Bonds issued by the BVI Company, which were first offered to the public in Israel on June 19, 2023.
In July 2023, the BVI Company issued an additional NIS 70.0 million ($19.2 million) in Series D Bonds. As of December 31, 2023, the Series
D Bonds had an outstanding principal balance of approximately $42.2 million.

 "TASE"
means the Tel Aviv Stock Exchange Ltd.

 "TRS"
means taxable REIT subsidiary.

 TENANT
INFORMATION

 This
Annual Report on Form 10-K includes information regarding certain of our tenants that lease properties from us and are not subject to
SEC reporting requirements.

 The
information related to our tenants contained or referred to in this Annual Report on Form 10-K was provided to us by such tenants. We
have not verified this information through an independent investigation or otherwise. We have no reason to believe that this information
is inaccurate in any material respect, but we cannot provide any assurance of its accuracy. We are providing this data for informational
purposes only.

 PART
I

 References
in this Annual Report on Form 10-K to "we," "our," "us" and "the Company" refer to Strawberry
Fields REIT, Inc., a Maryland corporation, together with its consolidated subsidiaries, Strawberry Fields Realty LP, a Delaware limited
partnership, which we refer to in this Form 10-K as our Operating Partnership. We are the sole general partner of our Operating Partnership.

 ITEM
1. Business

 We
are a self-managed and self-administered real estate company that specializes in the acquisition, ownership and triple-net leasing of
skilled nursing facilities and other post-acute healthcare properties. As of the date of this Form 10-K, our portfolio consisted of 100
healthcare properties with an aggregate of 12,449 licensed beds. We hold fee title to 97 of these properties and hold three properties
under long-term leases. These properties are located across Arkansas, Illinois, Indiana, Kentucky, Michigan, Ohio, Oklahoma, Tennessee
and Texas. Our 100 properties comprise 109 healthcare facilities, consisting of 99 skilled nursing facilities, 8 assisted living facilities
and 2 long-term acute care hospitals.

 We
generate substantially all of our revenues by leasing our properties to tenants under long-term leases primarily on a triple-net basis,
under which the tenant pays the cost of real estate taxes, insurance and other operating costs of the facility and capital expenditures.
Our properties are currently leased to 109 tenants under 32 lease agreements. Approximately 80.7% of our properties are held under a
master lease which provides for cross default provisions, cross collateralization and diversification of risk. As of the date of this
Form 10-K, our average remaining initial lease term is 6.4 years with average annual rent escalators of 2.7%. Most of our leases include
two 5-year renewal options to extend the term.

 We
are entitled to monthly rent paid by the tenants and we do not receive any income or bear any expenses from the operation of such facilities.
As of the date of this Form 10-K, the aggregate annualized average base rent for the expected life of the leases for our properties was
approximately $102.3 million.

 Each
healthcare facility located at our properties is managed by a qualified operator with an experienced management team. As of the date
of this Form 10-K, 64 facilities representing 67.3% of our annualized base rent are leased to and operated by related parties that
are affiliates of Moishe Gubin, who is our Chairman and Chief Executive Officer and Michael Blisko, who is one of our directors.
These properties are operated by affiliates of Infinity Healthcare Management ("Infinity Healthcare"), a healthcare
consulting business, beneficially owned by Mr. Gubin and Mr. Blisko/. Infinity Healthcare and its affiliates are one of the largest groups of operators of skilled nursing
facilities in the Midwest with over 10,000 beds. Our relationship with Infinity Healthcare provides us with unmatched insight into
operating trends and industry developments. Additionally, our relationship with Infinity Healthcare provides us with operating
flexibility with regard to evaluating potential new acquisitions or better understanding of operational issues pertaining to
underperforming tenants.

 Since
January 2017 we have grown significantly through acquisitions, having purchased 52 properties, with an aggregate purchase price of approximately
$335.1 million and weighted average lease yield of 15.0%. The weighted average lease yield is calculated as the annualized average annual
base rent for the expected life of the leases divided by total purchase price. Since 2017, our aggregate annualized average base rent
for the expected life of the leases for our properties has grown at an approximate 10.2% CAGR from $57.1 million in fiscal year 2017
to $102.3 million as of the date of this Form 10-K. In addition, our Adjusted EBITDA and FFO from 2018 to 2023 grew at an approximate
10.4% and 18.6% CAGR, respectively. During that period, we expanded our geographic footprint from six states to nine states.

 From
January 1, 2023, through March 19, 2024, we acquired 25 skilled nursing and assisted living facilities for a total cost of $108.0 million
(including finder fees and leasehold improvements), which includes capitalized acquisition costs. In addition to these acquisitions,
we leased two facilities which we expect to acquire in Q2 2024. These acquisitions and leases are expected to generate initial annual
cash revenues of approximately $0.45 million.

 Our
management team has extensive experience in acquiring, owning, financing, operating and leasing skilled nursing facilities and other
types of healthcare properties. The team is led by Moishe Gubin, our Chief Executive Officer and Chairman of our Board of Directors,
Greg Flamion, our Chief Financial Officer, and Jeffrey Bajtner who serves as our Chief Investment Officer. Combined, this team has over
50 years of experience investing in real estate and particularly in healthcare related real estate and operating companies. Mr. Gubin
began his career working at a skilled nursing operator in 1998 and developed in-depth knowledge of the business before purchasing his
first skilled nursing facility in 2003. Mr. Gubin has successfully raised equity and debt capital to facilitate over 125 real estate
related/healthcare related acquisitions totaling over $1.2 billion in gross investment. In addition, our management team has extensive
experience as operators of, and healthcare consultants to, skilled nursing facilities, having managed and operated over 90 skilled nursing
facilities, including 65 of our current tenants. We believe our management team's unique experience across both skilled nursing
operations and real estate and its extensive knowledge of the skilled nursing industry position us favorably to take advantage of healthcare
investment opportunities. Additionally, our deep and broad relationships with industry operators have allowed us to identify and acquire
skilled nursing facilities to which many of our competitors do not have access.

 We
have assembled a high quality and diversified portfolio of skilled nursing and other healthcare related facilities and we plan to continue
to invest primarily in skilled nursing facilities and other healthcare facilities that primarily provide services to the elderly. We
believe these asset classes provide potential for higher risk-adjusted returns compared to other forms of net-leased real estate assets
due to the specialized expertise necessary to acquire, own, finance and operate these properties, which are factors that tend to limit
competition among investors, owners, operators and finance companies. Additionally, our management team's strong relationships
in the industry have allowed us to acquire healthcare-related properties at valuations that achieve attractive lease yields, with the
goal of generating strong returns for our stockholders over the long-term. As we continue to acquire additional properties and expand
our portfolio, we expect to continue diversifying our portfolio by geography and by tenant, while also maintaining balance sheet strength
and liquidity.

 We
elected to be taxed as a REIT for U.S. federal income tax purposes commencing with our taxable year ending December 31, 2022. We believe
that we have been organized and have operated, and we intend to continue to operate, in a manner to qualify for taxation as a REIT. We
operate through an umbrella partnership, commonly referred to as an UPREIT structure, in which substantially all of our properties and
assets are held through Strawberry Fields Realty, L.P. (the "Operating Partnership"). We are the general partner of the Operating
Partnership and own approximately 12.6% of the outstanding OP units. To maintain REIT status, we must meet certain organizational and
operational requirements, including a requirement that we annually distribute to our stockholders at least 90% of our REIT taxable income,
determined without regard to the dividends paid deduction and excluding any net capital gains.

 We
generate revenues primarily by leasing healthcare-related properties to healthcare operators in triple-net lease arrangements, under
which the tenant is solely responsible for the costs related to the property (including property taxes, insurance, maintenance and repair
costs and capital expenditures). From time to time, we also extend loans to healthcare operators, generally secured by their receivables.
We conduct and manage our business as one operating segment for internal reporting and internal decision-making purposes. We expect to
grow our portfolio by pursuing opportunities to acquire additional properties that will be leased to a diverse group of local, regional
and national healthcare providers, which may include new or existing skilled nursing operators. We also anticipate diversifying our portfolio
over time, including by acquiring properties in different geographic markets, and in different asset classes. In addition, we actively
monitor the clinical, regulatory, and financial operating results of our tenants, and work to identify opportunities within their operations
and markets that could improve their operating results at our facilities. We communicate such observations to our tenants; however, we
have no contractual obligation to do so. Moreover, our tenants have sole discretion with respect to the day-to-day operation of the facilities
they lease from us, and how and whether to implement any observation we may share with them. We also actively monitor the overall occupancy,
skilled mix, and other operating metrics of our tenants monthly.

 We
have replaced tenants in the past, and may elect to replace tenants in the future, if they fail to meet the terms and conditions of their
leases with us. The replacement tenants may include tenants with whom we have had no prior landlord-tenant relationship as well as current
tenants with whom we are comfortable expanding our relationships. In addition, we periodically reassess the investments we have made
and the tenant relationships we have entered, and have selectively disposed of facilities or investments, or terminated such relationships,
and we expect to continue making such reassessments and, where appropriate, taking such actions.

 Our
Industry

 The
skilled nursing industry has evolved to meet the growing demand for post-acute and custodial healthcare services generated by an aging
population, increasing life expectancies and the trend toward shifting patient care to lower cost settings. We believe this evolution
has led to a number of favorable improvements in the industry, as described below:

 Shift
 of Patient Care to Lower Cost Alternatives. The growth of the senior population in the United States continues to increase healthcare
 costs. In response, federal and state governments have adopted cost-containment measures that encourage the treatment of patients
 in more cost-effective settings such as SNFs, for which the staffing requirements and associated costs are often significantly lower
 than acute care hospitals, inpatient rehabilitation facilities and other post-acute care settings. As a result, SNFs are generally
 serving a larger population of higher-acuity patients than in the past. The same trend is impacting ALFs, which are now generally
 serving some patients who previously would have received services at SNFs.

 Significant
 Acquisition and Consolidation Opportunities. The skilled nursing industry is large and highly fragmented, characterized predominantly
 by numerous local and regional providers. We believe this fragmentation provides significant acquisition and consolidation opportunities.

 Widening
 Supply and Demand Imbalance. The number of SNFs has declined modestly over the past several years. According to the Valuation
 & Information Group, which provides appraisal and market reports for the industry, the nursing home industry is currently comprised
 of approximately 14,800 facilities, as compared with over 16,700 facilities as of December 2000. Supply of new facilities is limited
 due to certificate of need restrictions. 71% of states have certificate of need restrictions., We expect that the supply/demand imbalance
 in the skilled nursing industry will increasingly favor skilled nursing providers due to the shift of patient care to lower cost
 settings and an aging population to meet the growing need for post-acute healthcare.

 Increased
 Demand Driven by Aging Populations. As seniors account for a higher percentage of the total U.S. population, we believe the overall
 demand for skilled nursing services will increase. At present, the primary market demographic for skilled nursing services is individuals
 aged 75 and older. The 2020 U.S. Census reported that there were over 56 million people in the United States in 2020 over the age
 of 65. The U.S. Census estimates this group to be one of the fastest growing segments of the United States population, projecting
 that it will almost double between 2020 and 2060. According to the Centers for Medicare & Medicaid Services, nursing home care
 facilities and continuing care retirement expenditures are projected to grow from approximately $196.8 billion in 2020, which includes
 federal expenditures in response to the COVID-19 pandemic, to approximately $266 billion in 2028. Although skilled nursing and seniors
 housing occupancy rates have declined during the COVID-19 pandemic, we believe that these trends in population will support an increasing
 demand for skilled nursing services in the long-term, which in turn will likely support an increasing demand for the services provided
 within our properties.

 Tenants
and Operators

 Our
properties are currently leased to 109 tenants under 32 lease agreements. Our leases include 11 master lease agreements that cover 88
facilities leased to 88 tenants, with the remaining 21 leases each covering a single facility leased to one tenant. 65 of our tenants
are related parties.

 Each
property is operated as a healthcare facility by a licensed operator, which may be the tenant or a separate operator. Each operator holds
a license granted by state regulators to operate a specific type of facility. All the operators have experienced management teams and
senior healthcare staff with substantial knowledge of their respective local markets. We target healthcare operators that are owned by
principals with a history of quality care, and the demonstrated ability to successfully navigate in a changing healthcare operating environment.
Certain operators are related parties.

 We
believe that each of the operators of our properties is primarily focused on serving the needs of the local community. Unlike operators
that are part of a large national healthcare conglomerate, we believe the operators at our properties can manage their facilities more
efficiently because they are not burdened by costly infrastructure and have the flexibility to rapidly adjust their cost structure to
respond to changes in the reimbursement environment.

 In
order to operate efficiently and improve profitability, most of the operators at our facilities have engaged large consulting firms that
specialize in healthcare and skilled nursing operations. These consulting firms provide advice and assistance on marketing, operating
policies and procedures, billing, collections and regulatory compliance. The operators and consultants work together to develop and standardize
best practices in the facilities, while operating in a cost-efficient manner. The operators at our properties primarily use one of nine
principal consulting firms, including three firms that are part of Infinity Healthcare, a healthcare consulting business that is owned
by the Moishe Gubin, who is our Chairman and Chief Executive Officer and Michael Blisko, who is one of our directors.

 The
tenants and operators of our properties have demonstrated the ability to generate consistent profitability despite the challenging markets
in which they operate. In many cases, these tenants and operators have successfully optimized and stabilized underperforming skilled
nursing facilities. While these tenants and operators have been successful, we expect to seek opportunities to diversify our tenant/operator
mix through future acquisitions that will be leased to new operators.

 The
following table contains information regarding our healthcare facility portfolio by tenant, as of March 19, 2024.

 Lessor/Company

 City

 State

 type

 Number
 of licensed beds

 Tenant
 Lease Expiration Year (1)

 Rentable
 square feet

 Percent
 leased

 Lease Income

 %
 of total Annualized Lease Income

 lease income per SQF

 Lease IN

 1020
 West Vine St, LLC

 The
 Waters of Princeton II, LLC

 Princeton

 IN

 SNF

 2025

 32,571

 %

 1,045,506

 1.02
 %

 32.10

 12803
 Lenover Street Realty, LLC

 The
 Waters of Dillsboro - Ross II, LLC

 Dillsboro

 IN

 SNF

 2025

 67,851

 %

 1,353,656

 1.32
 %

 19.95

 1350
 North Todd St, LLC

 The
 Waters of Scottsburg II, LLC

 Scottsburg

 IN

 SNF

 2025

 28,050

 %

 1,089,528

 1.06
 %

 38.84

 1600
 East Liberty Street Realty, LLC

 The
 Waters of Covington II, LLC

 Covington

 IN

 SNF

 2025

 40,821

 %

 1,309,634

 1.28
 %

 32.08

 1601
 Hospital Dr Realty, LLC

 The
 Waters of Greencastle II, LLC

 Greencastle

 IN

 SNF

 2025

 31,245

 %

 1,100,533

 1.08
 %

 35.22

 1712
 Leland Drive Realty, LLC

 The
 Waters of Huntingburg II, LLC

 Huntingburg

 IN

 SNF

 2025

 45,156

 %

 1,045,506

 1.02
 %

 23.15

 2055
 Heritage Dr Realty, LLC

 The
 Waters of Martinsville II, LLC

 Martinsville

 IN

 SNF

 2025

 30,060

 %

 1,133,549

 1.11
 %

 37.71

 3895
 Keystone Ave Realty, LLC

 The
 Waters of Indianapolis II, LLC

 Indianapolis

 IN

 SNF

 2025

 25,469

 %

 891,432

 0.87
 %

 35.00

 Rio Vista Lane Realty, LLC

 The
 Waters of Rising Sun II, LLC

 Rising
 Sun

 IN

 SNF

 2025

 16,140

 %

 638,309

 0.62
 %

 39.55

 Cross Ave Realty, LLC

 The
 Waters of Clifty Falls II, LLC

 Madison

 IN

 SNF

 2025

 39,438

 %

 1,518,736

 1.48
 %

 38.51

 East Highway 46 Realty, LLC

 The
 Water of Batesville II, LLC

 Batesville

 IN

 SNF

 2025

 59,582

 %

 946,458

 0.92
 %

 15.88

 2400
 Chateau Drive Realty LLC

 The
 Waters of Muncie II, LLC

 Muncie

 IN

 SNF

 2025

 22,350

 %

 792,384

 0.77
 %

 35.45

 Big
 H2O

 The
 Waters of Newcastle II, LLC (2)

 New
 Castle

 IN

 SNF

 2025

 24,860

 %

 726,352

 0.71
 %

 29.22

 Lease 253, Alton, Midwest

 Bradington Drive, LLC

 Bria
 of Columbia

 Columbia

 IL

 SNF

 2032

 43,189

 %

 410,821

 0.40
 %

 9.51

 3523
 Wickenhauser, LLC

 Bria
 of Alton

 Alton

 IL

 SNF

 2032

 44,840

 %

 624,862

 0.61
 %

 13.94

 North 17th St, LLC

 Bria
 of Belleville

 Belleville

 IL

 SNF

 2032

 50,650

 %

 621,410

 0.61
 %

 12.27

 South Lincoln Street LLC

 Bria
 of Smithton

 Smithton

 1623
 West Delmar Ave, LLC

 Bria
 of Godfrey

 Godfrey

 IL

 SNF

 2032

 15,740

 %

 234,755

 0.23
 %

 14.91

 Edwardsville Road LLC

 Bria
 of Wood River

 Wood
 River

 IL

 SNF

 2032

 29,491

 %

 365,941

 0.36
 %

 12.41

 Lease Landmark

 8200
 National Ave Realty, LLC

 of Midwest City Nursing and Rehab

 Midwest
 City

 OK

 SNF

 2032

 39,789

 %

 1,072,382

 1.05
 %

 26.95

 8200
 National Ave Realty, LLC

 of Midwest City Hospital

 Midwest
 City

 OK

 LTACH

 2032

 49,319

 %

 313,621

 0.31
 %

 6.36

 South 3rd St Realty LLC

 Chalet
 Of Niles

 Niles

 MI

 SNF

 2032

 31,895

 %

 1,011,681

 0.99
 %

 31.72

 1015
 Magazine Street, LLC

 of River City Rehabilitation and Nursing Center

 Louisville

 KY

 SNF

 2032

 36,050

 %

 930,747

 0.91
 %

 25.82

 Gagel Avenue, LLC

 of Iroquois Park Rehabilitation and Nursing Center

 Louisville

 KY

 SNF

 2032

 36,374

 %

 1,214,018

 1.18
 %

 33.38

 West Maple Avenue, LLC

 of Lancaster Rehabilitation and Nursing Center

 Lancaster

 KY

 SNF

 2032

 42,438

 %

 971,214

 0.95
 %

 22.89

 1155
 Eastern Parkway, LLC

 of Louisville Rehabilitation and Nursing Center

 Louisville

 KY

 SNF

 2032

 106,250

 %

 2,549,437

 2.48
 %

 23.99

 Bruce Court, LLC

 of Danville Rehabilitation and Nursing Center

 Danville

 KY

 SNF

 2032

 26,000

 %

 910,513

 0.89
 %

 35.02

 Bruce Court, LLC

 Goldenrod
 Village Assisted Living Center

 Danville

 KY

 ALF

 2032

 19,500

 %

 161,869

 0.16
 %

 8.30

 Bruce Court, LLC

 Hillside
 Suites Independent Living Center

 Danville

 KY

 Independent
 Living

 2032

 1,000

 -

 0.00
 %

 -

 Life Care Way, LLC

 of Bardstown Rehabilitation and Nursing Center

 Bardstown

 KY

 SNF

 2032

 36,295

 %

 1,011,681

 0.99
 %

 27.87

 1033
 North Highway 11, LLC

 of Laurel Creek Rehabilitation and Nursing Center

 Manchester

 KY

 SNF

 2032

 32,793

 %

 1,072,382

 1.05
 %

 32.70

 West Russell Street, LLC

 of Elkhorn City Rehabilitation and Nursing Center

 Elkhorn
 City

 KY

 SNF

 2032

 31,637

 %

 1,072,382

 1.05
 %

 33.90

 Jett Drive, LLC

 of Breathitt County Rehabilitation and Nursing Center, LLC

 Jackson

 KY

 SNF

 2032

 32,581

 %

 1,214,018

 1.19
 %

 37.26

 1253
 Lake Barkley Drive, LLC

 of Kuttawa, A Rehabilitation & Nursing Center

 Kuttawa

 KY

 SNF

 2032

 37,892

 %

 657,593

 0.64
 %

 17.35

 Lessor/Company

 City

 State

 type

 Number
 of licensed beds

 Tenant
 Lease Expiration Year (1)

 Rentable
 square feet

 Percent
 leased

 Lease Income

 %
 of total Annualized Lease Income

 lease income per SQF

 Lease Ohio

 -

 3090
 Five Points Hartford Realty, LLC

 Continent
 Healthcare Co - Hartford

 Fowler

 OH

 SNF

 2025

 15,504

 %

 196,012

 0.19
 %

 12.64

 3121
 Glanzman Rd Realty, LLC

 Continent
 Healthcare Co - Toledo

 Toledo

 OH

 SNF

 2025

 24,087

 %

 304,908

 0.30
 %

 12.66

 West Strub Rd Realty, LLC

 Continent
 Healthcare Co - Sandusky

 Sandusky

 OH

 SNF

 2025

 18,984

 %

 181,493

 0.18
 %

 9.56

 4250
 Sodom Hutchings Road Realty, LLC

 Continent
 Healthcare Co - Cortland

 Cortland

 OH

 SNF

 2025

 14,736

 %

 181,493

 0.18
 %

 12.32

 Lease TN 1

 Woodlawn Drive, LLC

 Lakebridge
 a Waters Community, LLC

 Johnson
 City

 TN

 SNF

 2031

 37,734

 %

 1,463,458

 1.43
 %

 38.78

 Buck Creek Road, LLC

 of Roan Highlands, LLC

 Roan
 Mountain

 TN

 SNF

 2031

 30,139

 %

 1,074,097

 1.05
 %

 35.64

 5th Avenue East, LLC

 of Springfield, LLC

 Springfield

 TN

 SNF

 2031

 19,900

 %

 886,130

 0.87
 %

 44.53

 2501
 River Road, LLC

 of Cheatham, LLC

 Ashland
 City

 TN

 SNF

 2031

 37,953

 %

 1,074,097

 1.05
 %

 28.30

 Enon Springs East, LLC

 of Smyrna, LLC

 Smyrna

 TN

 SNF

 2031

 34,070

 %

 1,221,786

 1.19
 %

 35.86

 Technology Lane, LLC

 of Johnson City, LLC

 Johnson
 City

 TN

 SNF

 2031

 34,814

 %

 1,127,802

 1.10
 %

 32.40

 Union Street, LLC

 of Shelbyville, LLC

 Shelbyville

 TN

 SNF

 2031

 44,327

 %

 1,288,917

 1.26
 %

 29.08

 Lease TN 2

 North Roan Street, LLC

 Agape
 Rehabilitation & Nursing Center, A Water's Community

 Johnson
 City

 TN

 SNF

 2031

 27,100

 %

 1,628,910

 1.59
 %

 60.11

 14510
 Highway 79, LLC

 of McKenzie, A Rehabilitation & Nursing Center

 McKenzie

 TN

 SNF

 2031

 22,454

 %

 1,279,858

 1.25
 %

 57.00

 6500
 Kirby Gate Boulevard, LLC

 of Memphis, A Rehabilitation & Nursing Center

 Memphis

 TN

 SNF

 2031

 51,565

 %

 1,745,261

 1.71
 %

 33.85

 Highway 11 South, LLC

 of Sweetwater, A Rehabilitation & Nursing Center

 Sweetwater

 TN

 SNF

 2031

 30,312

 %

 1,745,261

 1.71
 %

 57.58

 2830
 Highway 394, LLC

 of Bristol, A Rehabilitation & Nursing Center

 Bristol

 TN

 SNF

 2031

 53,913

 %

 2,327,014

 2.26
 %

 43.16

 Lease AR

 5301
 Wheeler Avenue, LLC

 The
 Blossoms at Fort Smith

 Fort
 Smith

 AR

 SNF

 2028

 41,490

 %

 821,950

 0.80
 %

 19.81

 Massey Avenue, LLC

 The
 Blossoms at Mountain View Assisted Living

 Mountain
 View

 AR

 ALF

 2028

 12,548

 %

 224,807

 0.22
 %

 17.92

 Oak Grove Street, LLC

 The
 Blossoms at Mountain View

 Mountain
 View

 AR

 SNF

 2028

 31,586

 %

 681,445

 0.67
 %

 21.57

 8701
 Riley Drive, LLC

 The
 Blossoms at Woodland Hills

 Rock

 AR

 SNF

 2028

 61,543

 %

 983,530

 0.96
 %

 15.98

 1516
 Cumberland Street, LLC

 The
 Blossoms at Cumberland

 Rock

 AR

 SNF

 2028

 82,328

 %

 843,025

 0.82
 %

 10.24

 5720
 West Markham Street, LLC

 The
 Blossoms at Midtown

 Rock

 AR

 SNF

 2028

 56,176

 %

 1,081,883

 1.06
 %

 19.26

 2501
 John Ashley Drive, LLC

 The
 Blossoms at North Little Rock

 Rock

 AR

 SNF

 2028

 65,149

 %

 983,530

 0.96
 %

 15.10

 1513
 South Dixieland Road, LLC

 The
 Blossoms at Rogers

 Rogers

 AR

 SNF

 2028

 32,962

 %

 772,773

 0.76
 %

 23.44

 North Street, LLC

 The
 Blossoms at Stamps

 Stamps

 AR

 SNF

 2028

 30,924

 %

 660,370

 0.65
 %

 21.35

 Lessor/Company

 City

 State

 type

 Number
 of licensed beds

 Tenant
 Lease Expiration Year (1)

 Rentable
 square feet

 Percent
 leased

 Lease Income

 %
 of total Annualized Lease Income

 lease income per SQF

 Lease AR SF LLC

 Lindley Lane, LLC

 The
 Blossoms at Newport

 Newport

 AR

 SNF

 2029

 49,675

 %

 850,639

 0.83
 %

 17.12

 2821
 West Dixon Road, LLC

 The
 Blossoms at West Dixon

 Rock

 AR

 SNF

 2029

 42,825

 %

 992,412

 0.97
 %

 23.17

 2821
 West Dixon Road, LLC

 The
 Blossoms at West Dixon Assisted Living

 Rock

 AR

 ALF

 2029

 7,557

 %

 226,837

 0.22
 %

 30.02

 Golf Links Road, LLC

 The
 Blossoms at Hot Springs

 Hot
 Springs

 AR

 SNF

 2029

 30,372

 %

 1,077,476

 1.05
 %

 35.48

 Lease IN 2 SF LLC

 8400
 Clearvista Place LLC

 The
 Waters of Castleton SNF, LLC

 Indianapolis

 IN

 SNF

 2029

 41,400

 %

 1,023,207

 1.00
 %

 24.72

 Anderson Road LLC

 The
 Waters of Chesterfield SNF, LLC

 Chesterfield

 IN

 SNF

 2029

 21,900

 %

 538,530

 0.53
 %

 24.59

 West Ellsworth Street LLC

 The
 Waters of Columbia City SNF, LLC

 Columbia
 City

 IN

 SNF

 2029

 30,462

 %

 753,942

 0.74
 %

 24.75

 11563
 West 300 South LLC

 The
 Waters of Dunkirk SNF, LLC

 Dunkirk

 IN

 SNF

 2029

 19,800

 %

 412,873

 0.40
 %

 20.85

 5544
 East State Boulevard LLC

 The
 Waters of Fort Wayne SNF, LLC

 Ft.
 Wayne

 IN

 SNF

 2029

 31,500

 %

 691,113

 0.68
 %

 21.94

 South 100 West LLC

 The
 Waters of Hartford City SNF, LLC

 Hartford
 City

 IN

 SNF

 2029

 22,400

 %

 583,407

 0.57
 %

 26.04

 2901
 West 37th Avenue LLC

 The
 Waters of Hobart SNF, LLC

 Hobart

 IN

 SNF

 2029

 43,854

 %

 987,305

 0.96
 %

 22.51

 1500
 Grant Street LLC

 The
 Waters of Huntington SNF, LLC

 Huntington

 IN

 SNF

 2029

 44,957

 %

 762,917

 0.75
 %

 16.97

 North Detroit Street LLC

 The
 Waters of LaGrange SNF, LLC

 Lagrange

 IN

 SNF

 2029

 31,133

 %

 897,550

 0.88
 %

 28.83

 Beechwood Avenue LLC

 The
 Waters of Middletown SNF, LLC

 Middletown

 IN

 SNF

 2029

 18,500

 %

 538,530

 0.53
 %

 29.11

 Blair Pike LLC

 The
 Waters of Peru SNF, LLC

 Peru

 IN

 SNF

 2029

 60,230

 %

 1,166,815

 1.14
 %

 19.37

 West Washington Street LLC

 The
 Waters of Rockport SNF

 Rockport

 IN

 SNF

 2029

 25,000

 %

 538,530

 0.53
 %

 21.54

 East 11th Street LLC

 The
 Waters of Rushville SNF

 Rushville

 IN

 SNF

 2029

 16,572

 %

 879,599

 0.86
 %

 53.08

 West Wolfe Street LLC

 The
 Waters of Sullivan SNF

 Sullivan

 IN

 SNF

 2029

 15,600

 %

 834,721

 0.82
 %

 53.51

 East Pickwick Drive LLC

 The
 Waters of Syracuse SNF

 Syracuse

 IN

 SNF

 2029

 26,000

 %

 592,383

 0.58
 %

 22.78

 Fairgrounds Road LLC

 The
 Waters of Tipton SNF

 Tipton

 IN

 SNF

 2029

 30,970

 %

 1,346,325

 1.32
 %

 43.47

 1900
 Alber Street LLC

 The
 Waters of Wabash SNF East

 Wabash

 IN

 SNF

 2029

 29,762

 %

 753,942

 0.74
 %

 25.33

 1720
 Alber Street LLC

 The
 Waters of Wabash SNF West

 Wabash

 IN

 SNF

 2029

 12,956

 %

 394,922

 0.39
 %

 30.48

 North Washington Street LLC

 The
 Waters of Wakarusa SNF

 Wakarusa

 IN

 SNF

 2029

 48,000

 %

 1,193,741

 1.17
 %

 24.87

 8400
 Clearvista Place LLC

 The
 Waters of Castleton ALF, LLC

 Indianapolis

 IN

 ALF

 2029

 43,900

 %

 484,677

 0.47
 %

 11.04

 North Detroit Street LLC

 The
 Waters of LaGrange ALF, LLC

 Lagrange

 IN

 ALF

 2029

 20,756

 %

 152,583

 0.15
 %

 7.35

 East 11th Street LLC

 The
 Waters of Rushville ALF, LLC

 Rushville

 IN

 ALF

 2029

 11,048

 %

 260,289

 0.25
 %

 23.56

 West Wolfe Street LLC

 The
 Waters of Sullivan ALF, LLC

 Sullivan

 IN

 ALF

 2029

 10,400

 %

 287,216

 0.28
 %

 27.62

 North Washington Street LLC

 The
 Waters of Wakarusa ALF, LLC

 Wakarusa

 IN

 ALF

 2029

 48,630

 %

 547,505

 0.54
 %

 11.26

 Lease TX

 1621
 Coit Road Realty, LLC

 of Plano Nursing and Rehab

 Plano

 TX

 SNF

 2033

 74,718

 %

 723,520

 0.71
 %

 9.68

 5601
 Plum Creek Drive Realty, LLC

 of Amarillo Nursing and Rehab

 Amarillo

 TX

 SNF

 2033

 90,046

 %

 447,678

 0.44
 %

 4.97

 2301
 North Oregon Realty, LLC

 Grace
 Point Wellness Center

 El
 Paso

 TX

 SNF

 2033

 19,895

 %

 823,004

 0.80
 %

 41.37

 Lessor/Company

 City

 State

 type

 Number
 of licensed beds

 Tenant
 Lease Expiration Year (1)

 Rentable
 square feet

 Percent
 leased

 Lease Income

 %
 of total Annualized Lease Income

 lease income per SQF

 Individual
 Leases

 Ambassador
 Nursing Realty, LLC

 Ambassador
 Nursing and Rehab, LLC

 IL

 SNF

 2026

 37,100

 %

 1,005,313

 0.98
 %

 27.10

 Momence
 Meadows Realty, LLC

 Momence
 Meadows Nursing & Rehab Center, LLC

 Momence

 IL

 SNF

 2025

 37,139

 %

 1,038,000

 1.01
 %

 27.95

 Oak
 Lawn Nursing Realty, LLC

 Oak
 Lawn Respiratory and Rehab center, LLC

 Oak
 Lawn

 IL

 SNF

 2028

 37,854

 %

 1,083,048

 1.06
 %

 28.61

 Forest
 View Nursing Realty, LLC

 Forest
 View Rehab and Nursing center, LLC

 Itasca

 IL

 SNF

 2024

 34,152

 %

 1,215,483

 1.19
 %

 35.59

 Lincoln
 Park Holdings, LLC

 Lakeview
 Rehab and Nursing center, LLC

 IL

 SNF

 2031

 34,362

 %

 1,260,000

 1.23
 %

 36.67

 Continental

 Continental
 Nursing and Rehab, LLC

 IL

 SNF

 2031

 53,653

 %

 1,575,348

 1.54
 %

 29.36

 Westshire

 City
 View Multi care Center LLC

 Cicero

 IL

 SNF

 2025

 124,020

 %

 1,788,365

 1.75
 %

 14.42

 Belhaven

 Belhaven
 Nursing and Rehab, LLC

 IL

 SNF

 2026

 60,000

 %

 2,134,570

 2.08
 %

 35.58

 West
 Suburban Nursing Realty, LLC

 West
 Suburban Nursing & Rehab Center, LLC

 Bloomingdale

 IL

 SNF

 2027

 70,314

 %

 1,961,604

 1.92
 %

 27.90

 Niles
 Nursing Realty, LLC

 Niles
 Nursing & Rehab, LLC

 Niles

 IL

 SNF

 2026

 46,480

 %

 2,409,998

 2.35
 %

 51.85

 Parkshore
 Estates Nursing Realty, LLC

 Parkshore
 Estates Nursing & Rehab Center, LLC

 IL

 SNF

 2024

 94,018

 %

 2,454,187

 2.40
 %

 26.10

 Midway
 Neurological and Rehab Realty, LLC

 Midway
 Neurological and Rehab Center, LLC

 Bridgeview

 IL

 SNF

 2026

 120,000

 %

 2,547,713

 2.49
 %

 21.23

 West Frech St, LLC

 Parker
 Nursing and Rehab, LLC

 Streator

 IL

 SNF

 2031

 24,979

 %

 498,351

 0.49
 %

 19.95

 4343
 Kennedy Drive, LLC

 Hope
 Creek Nursing and Rehabilitation Center, LLC

 East
 Moline

 IL

 SNF

 2030

 104,000

 %

 478,959

 0.47
 %

 4.61

 1316
 North Tibbs Avenue Realty LLC

 West
 Park a water community

 Indianapolis

 IN

 SNF

 2024

 26,572

 %

 549,885

 0.54
 %

 20.69

 1585
 Perry Worth Rd, LLC

 of Lebanon LLC

 Lebanon

 IN

 SNF

 2027

 32,650

 %

 116,678

 0.11
 %

 3.57

 2301
 North Oregon Realty, LLC

 Specialty
 Hospital Management

 El
 Paso

 TX

 LTACH

 2029

 24,660

 %

 1,050,853

 1.03
 %

 42.61

 9209
 Dollarway Road, LLC

 The
 Blossoms at White Hall

 White
 Hall

 AR

 SNF

 2029

 45,771

 %

 843,022

 0.82
 %

 18.42

 9300
 Ballard Rd Realty, LLC

 Zahav
 of DesPlaines

 Des
 Plaines

 IL

 SNF

 2033

 70,556

 %

 1,302,479

 1.26
 %

 18.46

 Netherland Lane, LLC

 of Kingsport

 Kingsport

 TN

 SNF

 2033

 28,140

 %

 151,323

 0.15
 %

 5.38

 2648
 Sevierville Road, LLC

 Asbury
 Inc - Maryville

 Maryville

 TN

 SNF

 2033

 49,810

 %

 302,647

 0.30
 %

 6.08

 Total/Average

 12,449

 2029

 4,296,662

 100.00
 %

 102,324,734

 100.00
 %

 23.82

 (1)
The tenant and the operator are the same for each facility other than the 32 SNFs leased under the two Indiana master lease agreements
and one SNF in Amarillo, Texas. In the case of these other facilities, the tenants are county hospitals which have entered into management
agreements with the operators listed in the table. These arrangements permit the facilities to participate in a CMS program that pays
higher Medicaid reimbursement rates for facilities associated with hospitals in underserved areas.

 (2)
The expiration dates do not reflect the exercise of any renewable options.

Party Tenants

 As
of March 19, 2024, we leased 65 of our facilities to tenants that are affiliates of: (i) Moishe Gubin who serves as
Chairman of the Board and our Chief Executive Officer, (ii) Michael Blisko, who serves as one of our directors, and (iii) Ted
Lerman, one of the controlling members of the Predecessor Company. As of March 19, 2024, approximately 67.3% of our
annualized base rent is received from such related-party tenants. The failure of these tenants to fulfill their obligations under
their leases or renew their leases upon expiration could have a material adverse effect on our business, financial condition and
results of operations. In January 2023, affiliates of Moishe Gubin and Michael Blisko acquired the membership interests held by the
affiliate of Ted Lerman in all of the related party tenants.

 Rental
income from leases with these related party tenants represented 67.3% of all rental income for the year ended December 31, 2023. We believe
these affiliated relationships provide a strong alignment of interests between us and our tenants and offers us increased operating flexibility
with regards to potentially replacing underperforming tenants or evaluating acquisitions in new states. As we continue to grow and expand
our portfolio, we intend to develop new relationships with unrelated party tenants and operators in order to diversify our tenant base
and reduce our dependence on related party and operators.

 The
following table contains information regarding tenant/operators that are related parties of the Company as March 19,
2024:

 Manager/Tenant/Operators that are Related Parties

 Lessor/Company Subsidiary

 Manager/Tenant/Operator

 Beneficial Owner Percentage in

 Tenant/Operator by Related Party

 Gubin/Gubin Enterprises LP

 Michael Blisko/Blisko Enterprises LP

 Master Lease Indiana

 1020 West Vine Street Realty, LLC

 The Waters of Princeton II LLC

 49.49
 %

 50.1
 %

 12803 Lenover Street Realty LLC

 The Waters of Dillsboro – Ross Manor II LLC

 49.49
 %

 50.51
 %

 1350 North Todd Drive Realty, LLC

 The Waters of Scottsburg II LLC

 49.49
 %

 50.1
 %

 1600 East Liberty Street Realty LLC

 The Waters of Covington II, LLC

 49.49
 %

 50.51
 %

 1601 Hospital Drive Realty LLC

 The Waters of Greencastle II LLC

 49.49
 %

 50.51
 %

 1712 Leland Drive Realty, LLC

 The Waters of Huntingburg II LLC

 49.49
 %

 50.1
 %

 2055 Heritage Drive Realty LLC

 The Waters of Martinsville II LLC

 49.49
 %

 50.51
 %

 3895 South Keystone Avenue Realty LLC

 The Waters of Indianapolis II LLC

 49.49
 %

 50.51
 %

 405 Rio Vista Lane Realty LLC

 The Waters of Rising Sun II LLC

 49.49
 %

 50.51
 %

 950 Cross Avenue Realty LLC

 The Waters of Clifty Falls II LLC

 49.49
 %

 50.51
 %

 958 East Highway 46 Realty LLC

 The Water of Batesville II LLC

 49.24
 %

 50.51
 %

 2400 Chateau Drive Realty, LLC

 The Waters of Muncie II LLC

 49.49
 %

 50.51
 %

 The Big H2O, LLC

 The Waters of New Castle II LLC

 49.49
 %

 50.51
 %

 Master Lease Tennessee

 115 Woodlawn Drive, LLC

 Lakebridge, a Waters Community, LLC

 50.00
 %

 50.00
 %

 146 Buck Creek Road, LLC

 The Waters of Roan Highlands, LLC

 50.00
 %

 50.00
 %

 704 5 TH Avenue East, LLC

 The Waters of Springfield, LLC

 50.00
 %

 50.00
 %

 2501 River Road, LLC

 The Waters of Cheatham, LLC

 50.00
 %

 50.00
 %

 202 Enon Springs Road East, LLC

 The Waters of Smyrna, LLC

 50.00
 %

 50.00
 %

 140 Technology Lane, LLC

 The Waters of Johnson City, LLC

 50.00
 %

 50.00
 %

 835 Union Street, LLC

 The Waters of Shelbyville, LLC

 50.00
 %

 50.00
 %

 Master Lease Tennessee 2

 505 North Roan Street, LLC

 Agape Rehabilitation & Nursing Center, A Water's Community, LLC

 50.00
 %

 50.00
 %

 14510 Highway 79, LLC

 Waters of McKenzie, A Rehabilitation & Nursing Center, LLC

 50.00
 %

 50.00
 %

 6500 Kirby Gate Boulevard, LLC

 Waters of Memphis, A Rehabilitation & Nursing Center, LLC

 50.00
 %

 50.00
 %

 978 Highway 11 South, LLC

 Waters of Sweetwater, A Rehabilitation & Nursing Center, LLC

 50.00
 %

 50.00
 %

 2830 Highway 394, LLC

 Waters of Bristol, A Rehabilitation & Nursing Center, LLC

 50.00
 %

 50.00
 %

 Master Lease Indiana 2

 8400 Clearvista Place LLC

 The Waters of Castleton SNF, LLC

 50.00
 %

 50.00
 %

 524 Anderson Road LLC

 The Waters of Chesterfield SNF, LLC

 50.00
 %

 50.00
 %

 640 West Ellsworth Street LLC

 The Waters of Columbia City SNF, LLC

 50.00
 %

 50.00
 %

 11563 West 300 South LLC

 The Waters of Dunkirk SNF, LLC

 50.00
 %

 50.00
 %

 5544 East State Boulevard LLC

 The Waters of Fort Wayne SNF, LLC

 50.00
 %

 50.00
 %

 548 South 100 West LLC

 The Waters of Hartford City SNF, LLC

 50.00
 %

 50.00
 %

 2901 West 37th Avenue LLC

 The Waters of Hobart SNF, LLC

 50.00
 %

 50.00
 %

 1500 Grant Street LLC

 The Waters of Huntington SNF, LLC

 50.00
 %

 50.00
 %

 787 North Detroit Street LLC

 The Waters of LaGrange SNF, LLC

 50.00
 %

 50.00
 %

 981 Beechwood Avenue LLC

 The Waters of Middletown SNF, LLC

 50.00
 %

 50.00
 %

 317 Blair Pike LLC

 The Waters of Peru SNF, LLC

 50.00
 %

 50.00
 %

 815 West Washington Street LLC

 The Waters of Rockport SNF

 50.00
 %

 50.00
 %

 612 East 11th Street LLC

 The Waters of Rushville SNF

 50.00
 %

 50.00
 %

 505 West Wolfe Street LLC

 The Waters of Sullivan SNF

 50.00
 %

 50.00
 %

 500 East Pickwick Drive LLC

 The Waters of Syracuse SNF

 50.00
 %

 50.00
 %

 300 Fairgrounds Road LLC

 The Waters of Tipton SNF

 50.00
 %

 50.00
 %

 1900 Alber Street LLC

 The Waters of Wabash SNF East

 50.00
 %

 50.00
 %

 1720 Alber Street LLC

 The Waters of Wabash SNF West

 50.00
 %

 50.00
 %

 300 North Washington Street LLC

 The Waters of Wakarusa SNF

 50.00
 %

 50.00
 %

 8400 Clearvista Place LLC

 The Waters of Castleton ALF, LLC

 50.00
 %

 50.00
 %

 787 North Detroit Street LLC

 The Waters of LaGrange ALF, LLC

 50.00
 %

 50.00
 %

 612 East 11th Street LLC

 The Waters of Rushville ALF, LLC

 50.00
 %

 50.00
 %

 505 West Wolfe Street LLC

 The Waters of Sullivan ALF, LLC

 50.00
 %

 50.00
 %

 300 North Washington Street LLC

 The Waters of Wakarusa ALF, LLC

 50.00
 %

 50.00
 %

 Individual Leases

 Ambassador Nursing Realty, LLC

 Ambassador Nursing and Rehabilitation Center II, LLC

 40.00
 %

 40.00
 %

 Momence Meadows Realty, LLC

 Momence Meadows Nursing and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 Oak Lawn Nursing Realty, LLC

 Oak Lawn Respiratory and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 Forest View Nursing Realty, LLC

 Forest View Rehabilitation and Nursing Center, LLC

 50.00
 %

 50.00
 %

 Lincoln Park Holdings, LLC

 Lakeview Rehabilitation and Nursing Center, LLC

 40.00
 %

 40.00
 %

 Continental Nursing Realty, LLC

 Continental Nursing and Rehabilitation Center, LLC

 40.00
 %

 40.00
 %

 Westshire Nursing Realty, LLC

 City View Multicare Center LLC

 50.00
 %

 50.00
 %

 Belhaven Realty, LLC

 Belhaven Nursing and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 West Suburban Nursing Realty, LLC

 West Suburban Nursing and Rehabilitation Center, LLC

 40.00
 %

 40.00
 %

 Niles Nursing Realty LLC

 Niles Nursing & Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 Parkshore Estates Nursing Realty, LLC

 Parkshore Estates Nursing and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 Midway Neurological and Rehabilitation Realty, LLC

 Midway Neurological and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 516 West Frech Street, LLC

 Parker Rehab & Nursing Center, LLC

 50.00
 %

 50.00
 %

 1316 North Tibbs Avenue Realty LLC

 Westpark A Waters Community, LLC

 50.00
 %

 50.00
 %

 1585 Perry Worth Road LLC

 The Waters of Lebanon LLC

 50.00
 %

 50.00
 %

 100 Netherland Lance LLC

 The Waters of Kingsport LLC

 50.00
 %

 50.00
 %

 We
monitor the creditworthiness of our tenants by evaluating the ability of the tenants to meet their lease obligations to us based on the
tenants' financial performance, including the evaluation of any guarantees of tenant lease obligations. The primary basis for our
evaluation of the credit quality of our tenants (and more specifically the tenants' ability to pay their rent obligations to us)
is the tenants' lease coverage ratios. These coverage ratios compare (i) earnings before interest, income taxes, depreciation,
amortization and rent ("EBITDAR") to rent coverage, and (ii) earnings before interest, income taxes, depreciation, amortization,
rent and management fees ("EBITDARM") to rent coverage. We utilize a standardized 5% management fee when we calculate lease
coverage ratios. We obtain various financial and operational information from our tenants each month. We regularly review this information
to calculate the above-described coverage metrics, to identify operational trends, to assess the operational and financial impact of
the changes in the broader industry environment (including the potential impact of government reimbursement and regulatory changes),
and to evaluate the management and performance of the tenants' operations. These metrics help us identify potential areas of concern
relative to our tenants' credit quality and ultimately the tenants' ability to generate sufficient liquidity to meet their
ongoing obligations, including their obligations to continue paying contractual rents due to us and satisfying other financial obligations
to third parties, as prescribed by our triple-net leases.

 Geographic
Diversification

 As
of March 19, 2024, our portfolio of 100 properties is broadly diversified by geographic
location across nine U.S. states, comprising Arkansas, Illinois, Indiana, Kentucky, Michigan, Ohio, Oklahoma, Tennessee and Texas.

 The
following table contains information regarding our healthcare facility portfolio by geography, as of March 19,
2024:

 State

 Number of Properties

 Facility Type

 Licensed Bed Count

 Annualized Average Base Rent (Amounts in $000s)

 % of Total Annualized Average Base Rent

 Indiana

 34 SNFs 5 ALFs

 3,240

 30,881

 30.2
 %

 20 SNFs

 4,226

 $
 25,011

 24.4
 %

 Tennessee

 14 SNFs

 1,304

 17,317

 16.9
 %

 Arkansas

 12 SNFs 2 ALFs

 1,568

 11,044

 10.8
 %

 Kentucky

 10 SNFs 1 ALF

 1,163

 11,766

 11.5
 %

 Texas

 3 SNFs 1 LTACH

 3,045

 3.0
 %

 Oklahoma

 1 SNFs 1 LTACH

 1,386

 1.4
 %

 Ohio

 4 SNFs

 0.8
 %

 Michigan

 1 SNF

 1,012

 1.0
 %

 Totals

 99 SNFs 2 LTACHs 8 ALFs

 12,449

 $
 102,326

 100.0
 %

 Competitive
Strengths

 We
believe that the following competitive strengths provide a solid foundation for the sustained growth of our business and successful execution
of our business strategies:

 Diversified
Portfolio. We have a portfolio that is diversified in terms of both geography and tenant composition. As of March 19, 2024,
our portfolio is comprised of 100 healthcare-related properties with a total of 12,449 licensed beds located throughout Arkansas, Illinois,
Indiana, Kentucky, Michigan, Ohio, Oklahoma, Tennessee and Texas. We believe that our geographic diversification limits the potential
impact of any regulatory, reimbursement, competitive dynamic or other changes in any single market on the overall performance of our
portfolio. We lease our properties to 109 tenants, with no single tenant accounting for more than 2.5% of our annualized base rent. This
diversification limits our exposure for any single tenant that encounters financial or operational difficulties.

 Protected
Markets. In eight of the nine states in which we operate, we benefit from CON laws that require state approval for the construction
and expansion of certain types of healthcare facilities. These laws represent significant barriers to entry and limit competition in
these markets.

 Demonstrated
Ability to Identify and Structure Accretive Acquisition Opportunities. Our management team has long-standing relationships in
the skilled nursing and post-acute industries. Through their experience in acquiring these types of facilities, we have the proven ability
to identify and complete complex and accretive transactions. Additionally, because many of our acquisitions are off-market opportunities
sourced through our management team's network of industry relationships, we believe we do not typically compete with larger healthcare-focused
real estate companies for acquisitions as they tend to focus on larger, platform acquisition opportunities. As a result, we have consistently
acquired assets at attractive valuations and believe we can continue to identify these types of opportunities to expand our portfolio.

 Significant
Experience Acquiring Underperforming Assets. Although we primarily seek to acquire properties that have had consistent profitability,
we may also acquire underperforming properties if we believe that the underlying facilities can become successful through better management.
Our management team's prior experience as operators gives it the ability to evaluate these types of facilities and their potential
for improved revenue enhancement and increased operating efficiencies. We will consider the acquisition of underperforming properties
if they are available at attractive valuations and provide us with significant upside potential once their new operators have successfully
stabilized and optimized their operations. If we acquire underperforming properties, we would expect to lease them to tenants and operators
that have significant turnaround experience and support from experienced consultants.

 Experienced
and Adept Operators. We have strong and long-standing relationships with operators and their principals who have significant
experience in operating successful skilled nursing facilities. These operators and their principals have a strong track record of operating
in challenging markets where operators are subject to increased regulatory issues and significant competition. Additionally, these operators
and their principals have learned to successfully operate facilities in which most of the revenue is earned from providing services to
patients covered by Medicaid which are subject to lower reimbursement rates than other revenue sources.

 Consulting
Firms Provide Additional Resources for the Operators of our Facilities. Most of the operators of our facilities utilize the services
of experienced healthcare consulting firms to provide them with expert advice and assistance with their operations. We believe these
consulting firms provide the operators with additional expertise and resources that materially enhance their ability to operate efficiently
and to meet applicable regulatory requirements.

 Close
Relationships with Tenants, Operators and Consultants Provide Enhanced Oversight, Market Intelligence and Strong Alignment of Interests.
 The nature of our close relationships with the tenants and operators of our properties and their consulting firms allows us to
maintain close communication and obtain early knowledge of potential issues faced by our tenants, enabling us to address those issues
that affect us as the lessor. These relationships also provide us with intelligence on the markets in which we own properties and assistance
in locating new and replacement tenants. Additionally, the consulting firms assist us without charge in evaluating potential acquisitions
and operators. This assistance provides us with insight into local market trends, which is particularly valuable for new markets. These
relationships also provide a strong alignment of interests between our interests as a property owner and our tenants' interests.

 Well-Structured,
Long-Term, Triple-Net Leases Generate Predictable and Growing Rental Income Streams. Most of our owned properties are leased
to tenants under long-term, non-cancellable, triple-net leases, pursuant to which the tenants are responsible for all maintenance and
repairs, insurance and taxes associated with the leased properties and the business conducted at the properties. As of December 31, 2023,
100% of the gross leasable area of our facilities was leased with an average remaining lease term of 6.4 years. Our leases generally
have terms that range from 10 to 20 years with two five-year extensions, and annual rent escalators of 1% to 3% per year, which provides
us with a steady and growing cash rental stream. Additionally, our leases are structured to provide us with key credit support and have
credit enhancement provisions that may include non-refundable security deposits of up to 6 months, personal and corporate guarantees
and cross-default provisions under our master leases. Approximately 72.9% of our total annualized rental revenue is generated through
our 11 master leases that have cross-default and cross-collateralization provisions.

 Seasoned
Management Team with Significant Experience. Moishe Gubin, our Chairman and Chief Executive Officer, has over 25 years of operating
and real estate experience in the skilled nursing and long-term care industries. Prior to founding the Predecessor Company, Mr. Gubin
worked as an operator of skilled nursing facilities and built a strong operational knowledge base that has been incorporated into the
day-to-day management of our current portfolio. Additionally, Mr. Gubin has significant acquisition experience having completed over
125 healthcare-related facilities with an aggregate investment amount of over $1.2 billion since 2003. Mr. Gubin also has significant
experience accessing debt capital markets to fund growth, having raised over $310 million of publicly traded bonds that are listed
on the Tel Aviv Stock Exchange. We believe that the diverse operational and financial background and expertise of our management team
gives us the ability to successfully manage our portfolio and sustain our growth.

 Our
Business and Growth Strategies

 Our
objective is to generate attractive returns for our stockholders over the long term through dividends and capital appreciation. Key
elements of our strategy include the following:

 Acquire
Additional Healthcare Properties in Concentrated Geographic Areas. We plan to invest primarily in real estate used as skilled
nursing facilities and other healthcare facilities that provide services to the elderly, where our management team has substantial experience
and relationships. We believe these facilities have the potential to provide higher risk-adjusted returns compared to other forms of
net-leased real estate assets due to the specialized expertise necessary to acquire, own, finance and manage these properties, which
are factors that tend to limit competition among investors, owners, operators and finance companies. We will seek to acquire properties
in states where we believe we can build regional density in order to create competitive advantages and drive operational and cost efficiencies.

 Negotiate
Well-Structured Net Leases. Our primary ownership structure is a facility purchase with a long-term triple-net lease with the
healthcare operator. We seek to structure our leases with lease terms of 10 years with tenant options to extend the lease for an additional
period of 5 to 10 years and rent escalators that provide a steadily growing cash rental stream. Our lease structures are designed to
provide us with credit support for our rents, including, in certain cases, lease deposits, covenants regarding liquidity, and various
provisions for cross-default. We believe these features help insulate us from variability in operator cash flows and enable us to minimize
our expenses while we continue to build our portfolio.

 Leverage
Existing and Develop New Operator Relationships. relationships in the healthcare industry
through which we have sourced our existing portfolio, and we intend to continue to expand our portfolio by leveraging these existing
relationships. Sixty-five of our properties are leased to related parties. One of our goals is to reduce our dependence on related party
tenants in order to diversify our tenant base. Although we expect to continue to lease properties to related party tenants in markets
in which the related party tenants have substantial experience and operations, we intend to lease properties in other markets to unrelated
tenants if we are able to identify qualified operators. Additionally, we will consider leasing properties to unrelated parties in markets
in which related parties operate if we are able to identify qualified operators that are willing to lease properties on terms that are
no less favorable than those available from related parties.

 Utilize
Prudent Investment Underwriting Criteria. We have adopted what we believe to be a thorough investment underwriting process based
on careful analysis and due diligence with respect to both the healthcare real estate and the healthcare service operations. We seek
to make investments in healthcare properties that have the following attributes: well-located, visible to traffic, in good physical condition
with predictable future capital improvement needs and with attractive prospects for future profitability.

 Monitor
the Performance of our Facilities and Industry Trends. We carefully monitor the financial and operational performance of our
tenants and of the specific facilities in which we invest through a variety of methods, such as reviews of periodic financial statements,
and regular meetings with the facility operators. Pursuant to the terms of our leases, our tenants are required to provide us with certain
periodic financial statements and operating data.

 Utilize
Targeted Leverage in Our Investing Activities. We seek to utilize a targeted level of leverage that is appropriate in light of
market conditions, future cash flows, the creditworthiness of tenants and future rental rates. We will seek to achieve a ratio of debt
to asset fair market value in the range of 45% to 55%. However, our charter and bylaws do not limit the amount of debt that we may incur
and our board of directors has not adopted a policy limiting the total amount of our borrowings.

 Policy
for the Acquisition and Sale of Properties

 In
considering these performance targets, readers should bear in mind that targeted performance for each acquisition is not a guarantee,
projection, forecast or prediction and is not necessarily indicative of future results. These performance targets are as of the date
hereof and may change in the future. The performance targets are based on an assumption that economic, market and other conditions will
not deteriorate and, in some cases, will improve. These performance targets are also based on estimates and assumptions about performance
believed to be reasonable under the circumstances, but actual realized returns of our investments will depend on, among other factors,
the ability to consummate attractive investments, future operating results, the value of the assets and market conditions at the time
of disposition, any related transaction costs and the timing and manner of sale, all of which may differ from the assumptions and circumstances
on which targeted returns are based. We believe the performance targets are reasonable, but readers should keep in mind that this investment
involves a high degree of risk and they should purchase these securities only if they can afford a complete loss of their investment.

 We
believe our management team's depth of experience in healthcare real estate, operations and finance provides us with unique perspective
in underwriting potential investments. Our real estate underwriting process focuses on both real estate and healthcare operations. The
process includes a detailed analysis of the facility and the financial strength and experience of the tenant and its management. Key
factors that we consider in the underwriting process include the following:

the current, historical and projected cash flow and operating margins of each tenant and at each facility;

the ratio of our tenants' operating earnings both to facility rent and to facility rent plus other fixed costs, including debt
costs;

the quality and experience of the tenant and its management team;

construction quality, condition, design and projected capital needs of the facility and property condition assessments;

competitive landscape;

drivers of healthcare-related needs;

the location of the facility;

local economic and demographic factors and the competitive landscape of the market;

licensure and accreditation;

the effect of evolving healthcare legislation and other existing and future regulations and compliance with such regulations on our tenants'
profitability and liquidity; and

the payor mix of private, Medicare and Medicaid patients at the facility.

 We
also require tenants to furnish property and operator-level financials, among other data, on a monthly basis; we evaluate individual
and portfolio property performance, liquidity metrics, lease and debt coverage, occupancy, planned capital expenditures, and other measures;
and we conduct in- person visits to each facility in the portfolio at least two times per year. We believe our underwriting process enables
us to acquire desirable properties with strong tenants that will support our ability to deliver attractive risk-adjusted returns to our
stockholders.

 The
policy does not limit the authority of our board of directors to change or deviate from the policy as it sees fit from time to time.
Changes to the policy do not require stockholder approval.

 Our
management does not have a fixed policy relating to the sale of properties. Accordingly, each potential sale opportunity will be examined
on its merits in view of the business opportunity involved.

 Our
Leases

 As
of March 19, 2024, all of our healthcare properties were subject to lease agreements. Our leases have a weighted-average annualized lease
income per leased square foot of $23.81, and a weighted-average remaining lease term of approximately 6.4 years.

 To
our knowledge, except as noted below, none of our current tenants are in default under any of the leases.

 Each
of our properties is leased under a separate lease agreement, although 11 groups of properties, covering a total of 88 facilities, are
subject to 11 master lease agreements. Each master lease agreement provides that the tenants under the master lease are jointly and severally
liable for the obligations of all of the other tenants under such master lease. We entered into these master lease agreements in order
to facilitate financing the underlying properties. Rental income under these master leases represents a substantial portion of our rental
income.

 The
following table summarizes information concerning the master lease agreements as of March 19, 2024 (dollars in thousands):

 Master Lease Agreements

 Master Lease Name

 States

 Facilities Count

 GLA

 Annualized Average Base Rent ($000s)

 % of Total Annualized Average Base Rent

 Master Lease Indiana 1 (1)

 IN

 463,593

 $
 13,592

 13.3
 %

 Master Lease Indiana 2 (1) IN

 705,730

 $
 16,623

 16.2
 %

 Master Lease Central Illinois 1

 IL

 205,060

 $
 1,657

 1.6
 %

 Master Lease Central Illinois 2

 IL

 45,231

.6
 %

 Master Lease Landmark

 TX/OK/ MI/IL/KY

 740,212

 $
 14,164

 13.8
 %

 Master Lease Ohio

 OH

 73,311

 $

.8
 %

 Master Lease Tennessee 1 (1)

 TN

 238,937

 $
 8,136

 8.0
 %

 Master Lease Tennessee 2 (1)

 TN

 185,344

 $
 8,726

 8.5
 %

 Master Lease Arkansas 1

 AR

 414,706

 $
 7,053

 6.9
 %

 Master Lease Arkansas 2

 AR

 130,429

 $
 3,147

 3.1
 %

 Master Lease Texas

 TX

 184,659

 $
 1,994

 1.95
 %

 Total (11)

 3,387,212

 $
 76,557

 74.8
 %

 (1)
The tenants under the two master leases in Indiana and the two Tennessee master leases are affiliated with Moishe Gubin, who is our Chairman
and Chief Executive Officer and Michael Blisko, who is one of our directors. See "Item 1. Business — Our Leases."

 The
following table summarizes information concerning the lease agreements that are not subject to a master lease agreement as of March 19,
2024 (dollars in thousands):

 Individual Leases

 Lessor

 State

 Facility Type

 Rentable Sq. Ft.

 Annualized Average Base Rent ($000s)

 % of Total Annualized Average Base Rent

 Ambassador Nursing Realty, LLC

 SNF

 37,100

 $
 1,005

 1.0
 %

 Momence Meadows Realty, LLC

 SNF

 37,139

 $
 1,038

 1.0
 %

 Oak Lawn Nursing Realty, LLC

 SNF

 37,854

 $
 1,083

 1.1
 %

 Forest View Nursing Realty, LLC

 SNF

 34,152

 $
 1,215

 1.2
 %

 Lincoln Park Holdings, LLC

 SNF

 34,362

 $
 1,260

 1.2
 %

 Continental Nursing Realty, LLC

 SNF

 53,653

 $
 1,575

 1.5
 %

 Westshire Nursing Realty, LLC

 SNF

 124,020

 $
 1,788

 1.7
 %

 Belhaven Realty, LLC

 SNF

 60,000

 $
 2,135

 2.1
 %

 West Suburban Nursing Realty, LLC

 SNF

 70,314

 $
 1,962

 1.9
 %

 Niles Nursing Realty LLC

 SNF

 46,480

 $
 2,410

 2.4
 %

 Parkshore Estates Nursing Realty, LLC

 SNF

 94,018

 $
 2,454

 2.4
 %

 Midway Neurological and Rehabilitation Realty, LLC

 SNF

 120,000

 $
 2,548

 2.5
 %

 516 West Frech Street, LLC

 SNF

 24,979

 $

 0.5
 %

 4343 Kennedy Drive, LLC

 SNF

 104,000

 $

 0.5
 %

 1316 North Tibbs Avenue Realty, LLC

 Indiana

 SNF

 26,572

 $

 0.5
 %

 1585 Perry Worth Rd, LLC

 Indiana

 SNF

 32,650

 $

 0.1
 %

 9300 Ballard Rd Realty, LLC

 SNF

 70,556

 $
 1,302

 1.3
 %

 2301 North Oregon Realty, LLC

 Texas

 LTACH

 24,660

 $
 1,050

 1.0
 %

 9209 Dollarway Road, LLC

 Arkansas

 SNF

 45,771

 $

 0.8
 %

 100 Netherland Lane LLC

 Tennessee

 SNF

 28,140

 0.2
 %

 2648 Sevierville Road LLC

 Tennessee

 SNF

 49,810

 0.3
 %

 Total (21)

 1,156,230

 $
 25,766

 25.2
 %

 Investment
and Financing Policies

 Our
properties are located in 9 states and we intend to continue to acquire properties in other states throughout the United States. Our
investment objectives are to increase cash flow, provide quarterly cash dividends, maximize the value of our properties and acquire properties
with cash flow growth potential. We intend to invest primarily in SNFs and seniors housing, including ALFs and we may determine in the
future to expand our investments to include medical office buildings, long-term acute care hospitals and inpatient rehabilitation facilities.
Although our portfolio currently consists primarily of owned real property, future investments may include first mortgages, mezzanine
debt and other securities issued by, or joint ventures with, REITs or other entities that own real estate consistent with our investment
objectives.

 Competition

 The
market for making investments in healthcare properties is highly fragmented, and increased competition makes it more challenging for
us to identify and successfully capitalize on opportunities that meet our investment objectives. In acquiring and leasing healthcare
properties, we compete with private equity funds, real estate developers, REITs, other public and private real estate companies and private
real estate investors, many of whom have greater financial resources than we have. We also face competition in leasing or subleasing
available facilities to prospective tenants.

 Regulation

 Healthcare
Regulatory Matters

 The
following discussion describes certain material healthcare laws and regulations that may affect our operations and those of our tenants/operators.
Although there is presently no Federal regulation on the lessor itself from Federal government agencies that regulate and inspect the
operators and no regulation of the lessor in the States in which we own real property, our tenants (the operators of skilled nursing
facilities, long-term acute care hospitals and other healthcare providers) are subject to extensive federal, state and local government
healthcare laws and regulations. These laws and regulations include requirements related to licensure, conduct of operations, ownership
of the facilities operation, addition or expansion of facilities and services, prices for services, billing for services and the confidentiality
and security of health-related information. Different properties within our portfolio may be more or less subject to certain types of
regulation, some of which are specific to the type of facility or provider. These laws and regulations are wide-ranging and complex,
may vary or overlap from jurisdiction to jurisdiction, and are subject frequently to change. Compliance with these regulatory requirements
can increase operating costs and, thereby, adversely affect the financial viability of our tenants/operators' businesses. Our tenants/operators'
failure to comply with these laws and regulations could adversely affect their ability to successfully operate our properties, or receive
reimbursement for services rendered within them, which could negatively impact their ability to satisfy their contractual obligations
to us. Our leases will require the tenants/operators to comply with all applicable laws, including healthcare laws.

 Our
tenants are subject directly to healthcare laws and regulations, because of the broad nature of some of these restrictions, such as the
Anti-Kickback Statute discussed below. We intend for all of our business activities and operations to conform in all material respects
with all applicable laws and regulations, including healthcare laws and regulations. We expect that the healthcare industry will continue
to face increased regulation and pressure in the areas of fraud, waste and abuse, cost control, healthcare management and provision of
services.

 Healthcare
Reform Measures. The Affordable Care Act changed how healthcare services are covered, delivered and reimbursed through expanded coverage
of uninsured individuals, reduced growth in Medicare program spending, reductions in Medicare and Medicaid reimbursement, including but
not limited to, Disproportionate Share Hospital, or DSH payments, and expanding efforts by governmental and private third party payors
to tie reimbursement to quality and efficiency. In addition, the law reformed certain aspects of health insurance, contains provisions
intended to strengthen fraud and abuse enforcement, and encourage the development of new payment models, including the creation of Accountable
Care Organizations, or ACOs. The status of the Affordable Care Act is subject to substantial uncertainty due to proposals to terminate
or modify its provisions. We are not able to predict the effect of such changes on our business since the nature of any changes is undetermined.
However, any changes that result in a decrease in payments made on behalf of patients are likely to reduce the income that our tenants
receive from the operation of facilities at our properties.

 Sources
of Revenue and Reimbursement. Our tenants and operators receive payments for patient services from the federal government under the
Medicare program, state governments under their respective Medicaid or similar programs, managed care plans, private insurers and directly
from patients. Medicare is a federal program that provides certain hospital and medical insurance benefits to persons age 65 and over,
some disabled persons, persons with end-stage renal disease and persons with Lou Gehrig's Disease. Medicaid is a federal-state
program, administered by the states pursuant to certain conditions imposed by the Federal government, which provides hospital and medical
benefits to qualifying individuals who are unable to afford healthcare. Generally, revenues for services rendered to Medicare patients
are determined under a prospective payment system, or PPS. CMS annually establishes payment rates for the PPS for each applicable facility
type and level of care provided.

 Amounts
received under Medicare and Medicaid programs are generally significantly less than established facility gross charges for the services
provided and may not reflect the provider's costs. Healthcare providers generally offer discounts from established charges to certain
group purchasers of healthcare services, including private insurance companies, employers, health maintenance organizations, or HMOs,
preferred provider organizations, or PPOs and other managed care plans. These discount programs generally limit a provider's ability
to increase revenues in response to increasing costs. Patients are generally not responsible for the total difference between established
provider gross charges and amounts reimbursed for such services under Medicare, Medicaid, HMOs, PPOs and other managed care plans, but
are responsible to the extent of any exclusions, deductibles or coinsurance features of their coverage. The amount of such exclusions,
deductibles and coinsurance continues to increase. Collection of amounts due from individuals is typically more difficult than from governmental
or third-party payers takes considerably longer and often requires the involvement of, and payment to, third parties to collect.

 Payments
to providers are being increasingly tied to quality and efficiency. These initiatives include requirements to report clinical data and
patient satisfaction scores, reduced Medicare payments to hospitals based on "excess" readmission rates as determined by
CMS, denial of payments under Medicare, Medicaid and some private payors for services resulting from a hospital or facility-acquired
condition, or HAC, and reduced Medicare payments to hospitals with high risk-adjusted HAC rates. Certain provider types, including, but
not limited to, inpatient rehabilitation facilities and long-term acute care hospitals, are subject to specific limits and restrictions
on eligibility for admissions which, in turn, affect reimbursement at these facilities.

 The
amounts of program payments received by our tenants/operators can be changed from time to time by legislative or regulatory actions and
by determinations by agents for the programs. Level of payment has also been impacted by the Federal budget sequestration which automatically
reduces payments as a result of funding limitations. The Medicare and Medicaid statutory framework is subject to administrative rulings,
interpretations and discretion that affect the amount and timing of reimbursement made under Medicare and Medicaid. Federal healthcare
program reimbursement changes may be applied retroactively under certain circumstances. In recent years, the federal government has enacted
various measures to reduce spending under federal healthcare programs. In April 2018, CMS announced as part of its patient driven payment
model ("PDPM") a skilled-nursing preferred payor system ("SNF-PPS") intended to reduce administrative burden,
and foster innovation to improve care and quality for patients. CMS estimates the program of payment redesign and policy changes would
increase Medicare payments to SNFs by 2.4% ($850 million) during 2019.

 In
addition, many states have enacted, or are considering enacting, measures designed to reduce their Medicaid expenditures and change private
healthcare insurance, and states continue to face significant challenges in maintaining appropriate levels of Medicaid funding due to
state budget shortfalls. Many States have also sought to control costs by implementing a variety of alternative care and payment models
authorized under Federal Medicaid waivers and such models often impose new or enhanced administrative requirements on health care providers
as a condition of payment. Further, non-government payers may reduce their reimbursement rates in accordance with payment reductions
by government programs or for other reasons. Healthcare provider operating margins may continue to be under significant pressure due
to the deterioration in pricing flexibility and payor mix, as well as increases in operating expenses that exceed increases in payments
under the Medicare and Medicaid programs.

 Anti-Kickback
Statute. A section of the Social Security Act known as the "Anti-Kickback Statute" prohibits, among other things, the
offer, payment, solicitation or acceptance of remuneration, directly or indirectly, in return for referring an individual to a provider
of services for which payment may be made in whole or in part under a federal healthcare program, including the Medicare or Medicaid
programs. Courts have interpreted this statute broadly and held that the Anti-Kickback Statute is violated if just one purpose of the
remuneration is to generate referrals, even if there are other lawful purposes. The Affordable Care Act provides that knowledge of the
Anti-Kickback Statute or specific intent to violate the statute is not required in order to violate the Anti-Kickback Statute. Violation
of the Anti-Kickback Statute is a crime, punishable by fines of up to $25,000 per violation, five years imprisonment, or both. Violations
may also result in civil and administrative liability and sanctions, including civil penalties of up to $50,000 per violation, liability
under the False Claims Act, exclusion from participation in federal and state healthcare programs, including Medicare and Medicaid, and
additional monetary penalties in amounts treble to the underlying remuneration.

 There
are a limited number of statutory exceptions and regulatory safe harbors for categories of activities deemed protected from prosecution
under the Anti-Kickback Statute. Currently, there are statutory exceptions and safe harbors for various activities, including the following:
certain investment interests, space rental, equipment rental, practitioner recruitment, personnel services and management contracts,
sale of practice, referral services, warranties, discounts, employees, managed care arrangements, investments in group practices, freestanding
surgery centers, ambulance replenishing and referral agreements for specialty services. The safe harbor for space rental arrangements
requires, among other things, that the aggregate rental payments be set in advance, be consistent with fair market value and not be determined
in a manner that takes into account the volume or value of any referrals. The fact that conduct or a business arrangement does not fall
within a safe harbor does not necessarily render the conduct or business arrangement illegal under the Anti-Kickback Statute. However,
such conduct and business arrangements may lead to increased scrutiny by government enforcement authorities.

 Many
states have laws similar to the Anti-Kickback Statute that regulate the exchange of remuneration in connection with the provision of
healthcare services, including prohibiting payments to physicians for patient referrals. The scope of these state laws is broad because
they can often apply regardless of the source of payment for care. These statutes typically provide for criminal and civil penalties,
as well as potential loss of facility licensure and eligibility for reimbursement by government payors.

 We
intend to use commercially reasonable efforts to structure our arrangements, including any lease/operating arrangements involving facilities
in which local physicians are investors, so as to satisfy, or meet as closely as possible, safe harbor requirements. The safe harbors
are narrowly structured, and there are not safe harbors available for every type of financial arrangement that we or our tenants/operators
may enter. Although it is our intention to fully comply with the Anti-Kickback Statue, as well as all other applicable state and federal
laws, we cannot assure you that all of our arrangements or the arrangements of our tenants/operators will meet all the conditions for
a safe harbor. There can be no assurance regulatory authorities enforcing these laws will determine our financial arrangements or the
financial relationships of our tenants/operators comply with the Anti-Kickback Statute or other similar laws and such regulatory authorities
or private qui tam relators bringing actions on behalf of government entities in exchange for a portion of any recovery may allege non-compliance
and seek financial or other penalties.

 Stark
Law. The Social Security Act also includes a provision commonly known as the "Stark Law." The Stark Law is a strict liability
statute that prohibits a physician from making a referral to an entity furnishing "designated health services" paid by Medicare
or Medicaid if the physician or a member of the physician's immediate family has a financial relationship with that entity unless
an exception to the law is met. Designated health services include, among other services, inpatient and outpatient hospital services,
clinical laboratory services, physical therapy services and radiology services. The Stark Law also prohibits entities that provide designated
health services from billing the Medicare and Medicaid programs for any items or services that result from a prohibited referral and
requires the entities to refund amounts received for items or services provided pursuant to the prohibited referral. Sanctions for violating
the Stark Law are imposed without consideration to intent and include denial of payment, civil monetary penalties of up to $15,000 per
prohibited service provided for failure to return amounts received in a timely manner, and exclusion from the Medicare and Medicaid programs.
The statute also provides for a penalty of up to $100,000 for a circumvention scheme. Failure to refund amounts received pursuant to
a prohibited referral may also constitute a false claim and result in additional penalties under the False Claims Act, which is discussed
in greater detail below.

 There
are exceptions to the self-referral prohibition for many of the customary financial arrangements between physicians and providers, including
employment contracts, leases and recruitment agreements. There is also an exception for a physician's ownership interest in an
entire hospital, as opposed to an ownership interest in a hospital department if such ownership interests and capacity were in place
as of March 23, 2010. Unlike safe harbors under the Anti-Kickback Statute, an arrangement must comply with every requirement of a Stark
Law exception, or the arrangement will be in violation of the Stark Law. Through a series of rulemakings, CMS has issued final regulations
implementing the Stark Law. While these regulations were intended to clarify the requirements of the exceptions to the Stark Law, it
is unclear how the government will interpret many of these exceptions for enforcement purposes and even an inadvertent failure to comply
with the strict requirements, such as assuring a signature, can result in imposition of penalties under certain circumstances.

 Although
there is an exception for a physician's ownership interest in an entire hospital, the Affordable Care Act prohibits newly created
physician-owned hospitals from billing for Medicare patients referred by their physician owners. As a result, the law effectively prevents
the formation after December 31, 2010 of new physician-owned hospitals that participate in Medicare and Medicaid. While the Affordable
Care Act grandfathers existing physician-owned hospitals, it does not allow these hospitals to increase the percentage of physician ownership
and significantly restricts their ability to expand services.

 Many
states also have laws similar to the Stark Law that prohibit certain self-referrals. The scope of these state laws is broad because they
can often apply regardless of the source of payment for care, and little precedent exists for their interpretation or enforcement. These
statutes typically provide for criminal and civil penalties, as well as loss of facility licensure.

 Although
our lease agreements will require tenants to comply with the Stark Law, we cannot offer assurance that the arrangements entered into
by us or by our tenants/operators will be found to be in compliance with the Stark Law or similar state laws.

 The
False Claims Act. The federal False Claims Act prohibits knowingly making or presenting any false claim for payment to the federal
government. The government may use the False Claims Act to prosecute Medicare and other government program fraud in areas such as coding
errors, billing for services not provided, submitting false cost reports and failing to report and repay an overpayment within 60 days
of identifying the overpayment or by the date a corresponding cost report is due, whichever is later. The False Claims Act defines the
term "knowingly" broadly. Although simple negligence will not give rise to liability under the False Claims Act, submitting
a claim with reckless disregard to its truth or falsity or failing to correct an error within specified period of time constitutes a
"knowing" submission.

 The
False Claims Act contains qui tam, or whistleblower, provisions that allow private individuals to bring actions on behalf of the government
alleging that the defendant has defrauded the federal government. Whistleblowers under the False Claims Act may collect a portion of
the government's recovery, which serves as an incentive to bring claims which then must be defended whether or not they have merit.
Every entity that receives at least $5 million annually in Medicaid payments must have written policies for all employees, contractors
or agents, providing detailed information about false claims, false statements and whistleblower protections under certain federal laws,
including the False Claims Act, and similar state laws.

 In
some cases, whistleblowers and the federal government have taken the position, and some courts have held, that providers who allegedly
have violated other statutes, such as the Anti-Kickback Statute and the Stark Law, have thereby submitted false claims under the False
Claims Act. The Affordable Care Act clarifies this issue with respect to the Anti-Kickback Statute by providing that submission of claims
for services or items generated in violation of the Anti-Kickback Statute constitutes a false or fraudulent claim under the False Claims
Act. If a defendant is found liable under the False Claims Act, the defendant may be required to pay three times the actual damages sustained
by the government, additional civil penalties of up to $10,000 per false claim, plus reimbursement of the fees of counsel for the whistleblower.

 Many
states have enacted similar statutes preventing the presentation of a false claim to a state government, and we expect more to do so
because the Social Security Act provides a financial incentive for states to enact statutes establishing state level liability.

 Other
Fraud & Abuse Laws. There are various other fraud and abuse laws at both the federal and state levels that cover false claims
and false statements and these may impact our business. For example, the Civil Monetary Penalties law authorizes the imposition of monetary
penalties against an entity that engages in a number of prohibited activities. The penalties vary by the prohibited conduct, but include
penalties of $10,000 for each item or service, $15,000 for each individual with respect to whom false or misleading information was given,
and treble damages for the total amount of remuneration claimed. The prohibited actions include, but are not limited to, the following:

knowingly presenting or causing to be presented, a claim for services not provided as claimed or which is otherwise false or fraudulent
in any way;

knowingly giving or causing to be giving false or misleading information reasonably expected to influence the decision to discharge a
patient;

offering or giving remuneration to any beneficiary of a federal healthcare program likely to influence the receipt of reimbursable items
or services; arranging for reimbursable services with an entity which is excluded from participation from a federal healthcare program;
or knowingly or willfully soliciting or receiving remuneration for a referral of a federal healthcare program beneficiary.

 Any
violations of the Civil Monetary Penalties Law by management or our tenants/operators could result in substantial fines and penalties
and could have an adverse effect on our business.

 HIPAA
Administrative Simplification and Privacy and Security Requirements. HIPAA, as amended by the HITECH Act, and its implementing regulations
create a national standard for protecting the privacy and security of individually identifiable health information (called "protected
health information"). Compliance with HIPAA is mandatory for covered entities, which include healthcare providers such as tenants/operators
of our facilities. Compliance is also required for entities that create, receive, maintain or transmit protected health information on
behalf of healthcare providers or that perform services for healthcare providers that involve the disclosure of protected health information,
called "business associates."

 Covered
entities must report a breach of protected health information that has not been secured through encryption or destruction to all affected
individuals without unreasonable delay, but in any case, no more than 60 days after the breach is discovered. Notification must also
be made to HHS and, in the case of a breach involving more than 500 individuals, to the media. In the final rule issued in January, 2013,
HHS modified the standard for determining whether a breach has occurred by creating a presumption that any non-permitted acquisition,
access, use or disclosure of protected health information is a breach unless the covered entity or business associate can demonstrate
that there is a low probability that the information has been compromised, based on a risk assessment.

 Covered
entities and business associates are subject to civil penalties for violations of HIPAA of up to $1.5 million per year for violations
of the same requirement. In addition, criminal penalties can be imposed not only against covered entities and business associates, but
also against individual employees who obtain or disclose protected health information without authorization. The criminal penalties range
up to $250,000 and up to 10 years imprisonment. In addition, state Attorneys General may bring civil actions for HIPAA violations, HHS
must conduct periodic HIPAA compliance audits of covered entities and business associates. If any of our tenants/operators are subject
to an investigation or audit and found to be in violation of HIPAA, such tenants/operators could incur substantial penalties, which could
have a negative impact on their financial condition. Our tenants/operators may also be subject to more stringent state law privacy, security
and breach notification obligations. Enforcement of HIPAA and the Health Information Technology for Economic and Clinical Health (HITECH)
Act, which substantially augmented the requirements under HIPAA have become increasingly stringent and the penalties for non-compliance
have become increasingly harsh.

 Licensure,
Certification and Accreditation. Healthcare property construction and operation are subject to numerous federal, state and local
regulations relating to the adequacy of medical care, equipment, personnel, operating policies and procedures, maintenance of adequate
records, fire prevention, rate-setting and compliance with building codes and environmental protection laws. The requirements for licensure,
certification and accreditation are subject to change and, in order to remain qualified, it may become necessary for our tenants/operators
to make changes in their facilities, equipment, personnel and services.

 Facilities
in our portfolio will be subject to periodic inspection by governmental and other authorities to assure continued compliance with the
various standards necessary for licensing and accreditation. We will require our healthcare properties to be properly licensed under
applicable state laws. Except for provider types not eligible for participation in Medicare and Medicaid, we expect our tenant/operators
to participate in the Medicare and Medicaid programs and, where applicable, to be accredited by an approved accrediting organization
which is also often a requirement for Medicare certification. The loss of Medicare or Medicaid certification would result in our tenants/operators
that operate Medicare/Medicaid-eligible providers from receiving reimbursement from federal healthcare programs. The loss of accreditation,
where applicable, would result in increased scrutiny by CMS and likely the loss of payment from non-government payers which often condition
participation and payment on participation in the Medicare program.

 In
some states, the construction or expansion of healthcare properties, the acquisition of existing facilities, the transfer or change of
ownership and the addition of new beds or services may be subject to review by and prior approval of, or notifications to, state regulatory
agencies under a Certificate of Need, or CON program. Such laws generally require the reviewing state agency to determine the public
need for additional or expanded healthcare properties and services and have begun to expect some level of revenue from enforcement action
in their budget planning. Some states in which we operate have also adopted limitations on the opening of new skilled nursing facilities.
See "Item 1. Business – Skilled nursing facility industry Business in the United States." The requirements for licensure,
certification and accreditation also include notification or approval in the event of the transfer or change of ownership or certain
other changes. Further, federal programs, including Medicare, must be notified in the event of a change of ownership or change of information
at a participating provider. Failure by our tenants/operators to provide required federal and state notifications, obtain necessary state
licensure and CON approvals could result in significant penalties as well as prevent the completion of an acquisition or effort to expand
services or facilities. We may be required to provide ownership information or otherwise participate in certain of these approvals and
notifications.

 Antitrust
Laws. The federal government and most states have enacted antitrust laws that prohibit certain types of conduct deemed to be anti-skilled
nursing facilities. These laws prohibit price fixing, concerted refusal to deal, market allocation, monopolization, attempts to monopolize,
price discrimination, tying arrangements, exclusive dealing, acquisitions of competitors and other practices that have, or may have,
an adverse effect on competition. Violations of federal or state antitrust laws can result in various sanctions, including criminal and
civil penalties. Antitrust enforcement in the healthcare industry is currently a priority of the Federal Trade Commission and the Antitrust
Division of the Department of Justice. We intend to operate so that we and our tenants/operators are in compliance with such federal
and state laws, but future review by courts or regulatory authorities could result in a determination that could adversely affect the
operations of our tenants/operators and, consequently, our operations. In addition to enforcement by Federal and State agencies, in an
effort to control health care costs, private payors such as employee welfare benefit plans administered by or for employers or unions
have become increasing aggressive in bringing actions against providers alleging violations of antitrust laws.

 Healthcare
Industry Investigations. Significant media and public attention has focused in recent years on the healthcare industry. The federal
government is dedicated to funding additional federal enforcement activities related to healthcare providers and preventing fraud and
abuse. Our tenants/operators will engage in many routine healthcare operations and other activities that could be the subject of governmental
investigations or inquiries. For example, our tenants/operators will likely have significant Medicare and Medicaid billings, numerous
financial arrangements with physicians who are referral sources, and joint venture arrangements involving physician investors. In recent
years, Congress and the States have increased the level of funding for fraud and abuse enforcement activities. It is possible that governmental
entities could initiate investigations or litigation in the future and that such proceedings could result in significant costs and penalties,
as well as adverse publicity. It is also possible that our executives could be included in governmental investigations or litigation
or named as defendants in private litigation.

 Governmental
agencies and their agents, such as the Medicare Administrative Contractors, fiscal intermediaries and carriers, as well as the HHS-OIG,
CMS and state Medicaid programs, may conduct audits of our tenants/operator's operations. Private payers may conduct similar post-payment
audits, and our tenants/operators may also perform internal audits and monitoring. Many of these audits employ the use of statistical
sampling and extrapolation whereby a small number of claims are reviewed but adverse results are applied against a provider's claims
for long periods of time. Depending on the nature of the conduct found in such audits and whether the underlying conduct could be considered
systemic such that results are extrapolated, the resolution of these audits which can often require substantial repayments could have
a material, adverse effect on our portfolio's financial position, results of operations and liquidity.

 Under
the Recovery Audit Contractor, or RAC program, CMS contracts with RACs on a contingency basis to conduct post-payment reviews to detect
and correct improper payments in the fee-for-service Medicare program, to managed Medicare plans and in the Medicaid program. CMS has
also initiated a RAC prepayment demonstration program in 11 states. CMS also employs Medicaid Integrity Contractors, or MICs to perform
post-payment audits of Medicaid claims and identify overpayments. In addition to RACs and MICs, the state Medicaid agencies and other
contractors have increased their review activities. Aside from the costs associated with responding to a myriad of requests for substantiation
of services, should any of our tenants/operators be found out of compliance with any of these laws, regulations or programs, our business,
our financial position and our results of operations could be negatively impacted.

 Environmental
Matters

 A
wide variety of federal, state and local environmental and occupational health and safety laws and regulations affect healthcare property
operations. These complex federal and state statutes, and their enforcement, involve a myriad of regulations, many of which involve strict
liability on the part of the potential offender. Some of these federal and state statutes may directly impact us. Under various federal,
state and local environmental laws, ordinances and regulations, an owner of real property or a secured lender, such as us, may be liable
for the costs of removal or remediation of hazardous or toxic substances at, under or disposed of in connection with such property, as
well as other potential costs relating to hazardous or toxic substances (including government fines and damages for injuries to persons
and adjacent property). The cost of any required remediation, removal, fines or personal or property damages and the owner's or
secured lender's liability therefore could exceed or impair the value of the property, and/or the assets of the owner or secured
lender. In addition, the presence of such substances, or the failure to properly dispose of or remediate such substances, may adversely
affect the owner's ability to sell or rent such property or to borrow using such property as collateral which, in turn, could reduce
our revenues.

 Prior
to closing any property acquisition or loan, we ordinarily obtain Phase I environmental assessments in order to attempt to identify potential
environmental concerns at the facilities. These assessments will be carried out in accordance with an appropriate level of due diligence
and will generally include a physical site inspection, a review of relevant federal, state and local environmental and health agency
database records, one or more interviews with appropriate site-related personnel, review of the property's chain of title and review
of historic aerial photographs and other information on past uses of the property. We may also conduct limited subsurface investigations
and test for substances of concern where the results of the Phase I environmental assessments or other information indicates possible
contamination or where our consultants recommend such procedures.

 Americans
with Disabilities Act

 Our
properties must comply with Title III of the ADA to the extent that such properties are "public accommodations" as defined
by the ADA. The ADA may require removal of structural barriers to access by persons with disabilities in certain public areas of our
properties where such removal is readily achievable. Many States and localities have similar requirements that are in addition to, and
sometime more stringent than, Federal requirements. We believe the existing properties are in substantial compliance with the ADA and
that we will not be required to make substantial capital expenditures to address the requirements of the ADA. However, noncompliance
with the ADA or a comparable State or local requirement could result in imposition of fines or an award of damages to private litigants.
The obligation to make readily achievable accommodations is an ongoing one, and we will continue to assess our properties and to make
alterations as appropriate in this respect.

 Emerging
Growth Company Status

 We
are an "emerging growth company," as defined in the JOBS Act, and we are eligible to take advantage of certain exemptions
from various reporting requirements that are applicable to other public companies that are not "emerging growth companies,"
including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure
obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding
a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
We have not yet made a decision as to whether we will take advantage of any or all of these exemptions. If we do take advantage of any
of these exemptions, we do not know if some investors will find common stock less attractive as a result. The result may be a less active
trading market for common stock and our stock price may be more volatile.

 In
addition, the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period
provided in the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can
delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected
to avail ourselves of the extended transition period for adopting new or revised accounting standards available to emerging growth companies.

 We
will remain an "emerging growth company" until the earliest to occur of (i) the last day of the fiscal year during which
our total annual revenue equals or exceeds $1.07 billion (subject to adjustment for inflation), (ii) the last day of the fiscal year
following the fifth anniversary of the first sale of shares pursuant to a registration statement filed under the Securities Act, (iii)
the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible debt or (iv) the date
on which we are deemed to be a "large accelerated filer" under the Exchange Act.

 Human
Capital Resource Management

 As
of December 31, 2023, we had 9 full-time employees. Our employees are primarily located at our corporate office in Chicago. Our employees
are not members of any labor union, and we consider our relations with our employees to be satisfactory.

 We
endeavor to maintain workplaces that are free from discrimination or harassment on the basis of color, race, sex, national origin, ethnicity,
religion, age, disability, sexual orientation, gender identification or expression or any other status protected by applicable law. The
basis for recruitment, hiring, development, training, compensation and advancement at the Company is qualifications, performance, skills
and experience. We believe our employees are fairly compensated, and compensation and promotion decisions are made without regard to
gender, race and ethnicity. Employees are routinely recognized for outstanding performance.

 Insurance

 We
require our tenants to maintain general liability, professional liability, all risks and other insurance coverages and to name us as
an additional insured under these policies. We believe that the policy specifications and insured limits are appropriate given the relative
risk of loss, the cost of the coverage and industry practice.

 Available
Information

 We
file annual, quarterly and current reports, proxy statements and other information with SEC. The SEC maintains an internet site that
contains these reports, and other information about issuers, like us, which file electronically with the SEC. The address of that site
is  We make available our reports on Form 10-K, 10-Q, and 8-K (as well as all amendments to these reports), and other
information, free of charge, on the Investor Relations section of our website at www.strawberryfieldsreit.com. The information
found on, or otherwise accessible through, our website is not incorporated by reference into, nor does it form a part of, this report
or any other document that we file with the SEC.

 ITEM
1A. Risk Factors

 Not
applicable.

 ITEM
1B. Unresolved Staff Comments

 Not
applicable.

 ITEM
 1C. Cybersecurity

 Our
management recognizes the critical importance of addressing cybersecurity threats and risks to our business and operations. Therefore,
we have established a comprehensive framework to assess and manage material risks arising from cybersecurity threats.

 Our
Information Security Officer ("ISO") and the Cybersecurity Incident Response Team ("IRT") are responsible for
assessing and managing cybersecurity risks. The IRT is comprised of individuals with expertise in information security, technology, legal
and risk management. The IRT monitors cybersecurity incidents and potential threats. It liaises with external cybersecurity experts and
industry partners to stay current on emerging threats and best practices. The diverse expertise of the IRT members enables comprehensive
risk assessment and swift responses to mitigate the potential impact of breaches or other cybersecurity incidents.

 We
actively engage consultants, outside counsel and other technology experts to enhance our cybersecurity risk management processes. We
perform regular assessments and evaluations of the effectiveness of our cybersecurity measures. In addition to third party engagements,
we maintain rigorous oversight of cybersecurity risks associated with our use of third party service providers. Vendor management processes
are employed to evaluate vendors' cybersecurity practices, assess risk position and implement measures to mitigate potential threats
arising from these external relationships.

 The
Board of Directors has been designated to oversee cybersecurity risk management. Its members possess diverse expertise, which enables
them to effectively evaluate the adequacy of our cybersecurity measures and challenge management's approach when necessary. The Information
Security Officer provides regular updates to our chief executive officer and Board of Directors on cybersecurity risks, ongoing initiatives,
incidents, response activities and strategies. The Board of Directors acknowledges cybersecurity as a strategic risk and a priority for
the Company. The Board of Directors is actively involved in the oversight of our cybersecurity risk management efforts, ensuring alignment
with our overall business objectives.

 We
continuously strive to strengthen our cybersecurity measures to protect our systems and data from evolving threats. To date, cybersecurity
incidents and risks have not materially affected us, including our business strategy, results of operations, or financial condition.

 ITEM
2. Properties

 We
hold fee title to 97 of these properties and hold three property under a long-term lease. These properties are located across Arkansas,
Illinois, Indiana, Kentucky, Michigan, Ohio, Oklahoma, Tennessee and Texas. Our 100 properties comprise 109 healthcare facilities, consisting
of the following:

99 stand-alone skilled nursing facilities;

two dual-purpose facilities used as both skilled nursing facilities and long-term acute care hospitals; and

eight assisted living facilities.

 Information
regarding our properties as of December 31, 2023, are included in Item 15. "Exhibits and Financial Statement Schedules—Schedule
III. Real Estate and Accumulated Depreciation" of this Annual Report on Form 10-K.

 As
of December 31, 2023, almost all of our properties are leased under long-term, triple-net leases. The following table displays the expiration
of the annualized contractual cash rental income under our lease agreements as of December 31, 2023:

 Lease Expirations

 Year of Lease
 Expiration (1)

 Number of Leases Facilities

 GLA of Leases Expiring

 Percent of Portfolio GLA

 Annualized Base Rent

 Percentage of Total Annualized Base Rent

 Annualized Base Rent Per Sq. Ft.

 2024

 154,742

 3.67
 %

 4,219,554

 4.31
 %

 $
 27.27

 2025

 698,063

 16.55
 %

 17,281,846

 17.64
 %

 $
 24.76

 2026

 263,580

 6.25
 %

 8,097,593

 8.26
 %

 $
 30.72

 2027

 102,964

 2.44
 %

 2,078,281

 2.12
 %

 $
 20.18

 2028

 414,706

 9.83
 %

 7,053,312

 7.20
 %

 $
 17.01

 Thereafter

 2,584,657

 61.26
 %

 59,262,131

 60.48
 %

 $
 22.93

 Total

 4,218,712

 100.0
 %

 $
 97,992,717

 100.0
 %

 $
 23.23

 (1)
The year of each lease expiration is based on current contract terms.

 ITEM
3. Legal Proceedings

 We
are not currently a party to any material legal proceedings, that are not covered by insurance and expected to be resolved within policy
limits, other than the following:

 In
March 2020, Joseph Schwartz, Rosie Schwartz and certain companies owned by them filed a complaint in the U.S. District Court for the
Northern District of Illinois against Moishe Gubin, Michael Blisko, the Predecessor Company and 21 of its subsidiaries, as well as the
operators of 17 of the facilities operated at our properties. The complaint was related to the Predecessor Company's acquisition
of 16 properties located in Arkansas and Kentucky that were completed between May 2018 and April 2019 and the attempt to purchase an
additional five properties located in Massachusetts. The complaint was dismissed by the Court in 2020 on jurisdictional grounds. The
plaintiffs did not file an appeal with respect to this action, and the time for an appeal has expired.

 In
August 2020, Joseph Schwartz, Rosie Schwartz and several companies controlled by them filed a second complaint in the Circuit Court in
Pulaski County, Arkansas. The second complaint had nearly identical claims as the federal case, but was limited to matters related to
the Predecessor Company's acquisition of properties located in Arkansas. The sellers, which were affiliates of Skyline Health Care,
had encountered financial difficulties and requested the Predecessor Company to acquire these properties. The defendants have filed an
answer denying the plaintiffs' claims and asserting counterclaims based on breach of contract. This case has been dismissed without
prejudice.

 In
January 2021, Joseph Schwartz, Rosie Schwartz and certain companies owned by them filed a third complaint in Illinois state court in
Cook County, Illinois, which has nearly identical claims to the initial federal case, but was limited to claims related to the Kentucky
and Massachusetts properties. The complaint has not been properly served on any of the defendants, and, accordingly, the defendants did
not responded to the complaint. Instead, the defendants filed a motion to quash service of process. On January 11, 2023, the Cook County
Circuit Court entered an order granting such motion, quashing service of process on all defendants. In March 2023, the plaintiffs filed
a new complaint and again attempted to serve it on the defendants. It is the defendants' position that service was (once again,
potentially) defective and sought a dismissal of the matter for want of prosecution by Joseph Schwartz, Rosie Schwartz and certain companies
owned by them. The dismissal was granted, but has been appealed to the Illinois Appellate Court, with no substantive movement on the
matter to date.

 In
each of these complaints, the plaintiffs asserted claims for fraud, breach of contract and rescission arising out of the defendants alleged
failure to perform certain post-closing obligations under the purchase contracts. We have potential direct exposure for these claims
because the subsidiaries of the Predecessor Company that were named as defendants are now subsidiaries of the Operating Partnership.
Additionally, the Operating Partnership is potentially liable for the claims made against Moishe Gubin, Michael Blisko and the Predecessor
Company pursuant to the provisions of the contribution agreement, under which the Operating Partnership assumed all of the liabilities
of the Predecessor Company and agreed to indemnify the Predecessor Company and its affiliates for such liabilities. We and the named
defendants believe that the claims set forth in the complaints are without merit. The named defendants intend to vigorously defend the
litigation and to assert counterclaims against the plaintiffs based on their failure to fulfill their obligations under the purchase
contracts, interim management agreement, and operations transfer agreements. We believe this matter will be resolved without a material
adverse effect to the Company.

 As
noted above, the March 2020 and January 2021 complaints also related to the Predecessor Company's planned acquisition of five properties
located in Massachusetts. A subsidiary of the Predecessor Company purchased loans related to these properties in 2018 for a price of
$7.74 million with the expectation that the subsidiaries would acquire title to the properties and the loans would be retired. The subsidiary
subsequently advanced $3.1 million under the loans to satisfy other liabilities related to the properties. The planned acquisition/settlement
with the sellers/owners and/borrowers was not consummated because the underlying tenants of the properties surrendered their licenses
to operate healthcare facilities on these properties.

 The
Predecessor Company intends to institute legal proceedings to collect the outstanding amount of these loans and to assert related claims
against the sellers and their principals for the unpaid principal balances as well as protective advances and collection costs. In connection
with enforcing their rights, in July 2022, the Company foreclosed, and (as lender) sold four of the five properties at auction for the
total amount of $4.4 million. In December 2022, the Company took title on the fifth property with an estimated fair value of $1.2 million.

 ITEM
4. Mine Safety Disclosures

 Not
applicable.

 PART
II

 ITEM
5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Common Equity

 On
September 23, 2022, our common stock commenced trading on the OTCQX market operated by the OTC Markets Group, Inc., under the symbol
"STRW". On February 22, 2023, our common stock commenced trading on the NYSE American market, also under the symbol "STRW".

 The
following table sets forth, for the periods indicated, the high and low sales prices for our common stock as reported for each quarter
of 2023. This information reflects inter-dealer prices, without retail mark-up, markdown or commission and may not represent actual transactions.

 High

 Low

 Quarter Ended March 31, 2023

 $
 9.25

 $
 5.79

 Quarter Ended June 30, 2023

 $
 7.89

 $
 5.79

 Quarter Ended September 30, 2023

 $
 7.41

 $
 6.09

 Quarter Ended December 31, 2023

 $
 7.99

 $
 5.93

 As
of March 19, 2024, 812 stockholders of record owned 6,474,175 issued and outstanding shares of
common stock. This number of stockholders of record does not represent the actual number of beneficial owners of our common stock because
shares of our common stock are also held in "street name" by securities brokers and others for the benefit of beneficial
owners who may vote the shares.

 In
addition, as of March 19, 2024, the Operating Partnership had 45,373,615 outstanding OP Units held by 10 limited partners other
than the Company. No public trading market exists for the OP Units.

 To
maintain REIT status, we are required each year to distribute to stockholders at least 90% of our annual REIT taxable income after certain
adjustments. All distributions will be made by us at the discretion of our board of directors and will depend on our financial position,
results of operations, cash flows, capital requirements, debt covenants (which include limits on distributions by us), applicable law,
and other factors as our board of directors deems relevant.

 Distributions
with respect to our common stock can be characterized for federal income tax purposes as taxable ordinary dividends, non-dividend distributions
or a combination thereof. Following is the characterization of our annual cash dividends on common stock for 2023:

 (dollars in thousands)

 Common Stock

 Ordinary dividend

 $
 2,572

 Non-dividend distributions

 $

 Capital Gain Distribution

 $

 Total taxable distribution

 $
 2,872

 Purchases
of Equity Securities by the Issuer and Affiliated Purchasers

 During
2023, affiliates of the Company purchased 9,176 shares of our common stock in the open market at an average price per share of $6.95
and an aggregate repurchase cost of $63,751.

 During 2023, the Company converted 127,953 OP Units into shares of common stock.

 On
November 9, 2023 the Board of Directors authorized the repurchase of up to $5 million of the Company's common stock. As of December
31 st, 2023 the Company purchased 5,953 shares of common stock at an average price per share of $7.84 and an aggregate repurchase
priced of $46,000. All common shares repurchased in the program have been retired and are now held as unissued shares available for
use and reissuance for purpose as and when determined by the Board.

 The
following table sets forth information regarding the Company's repurchase of shares of its outstanding common stock during the
three months ended December 31, 2023.

 Period

 Number of Shares

 Average Price Paid Per Share

 Cumulative Number of Shares Purchased as Part of Publicly Announced Plans or Programs

 Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs

 October 1-31, 2023

 -

 -

 -

 -

 November 1-30, 2023

 -

 -

 -

 -

 December 1-31, 2023

 5,953

 $
 7.84

 5,953

 $
 4,954,000

 Total

 5,953

 $
 7.84

 5,953

 $
 4,954,000

 Securities
Authorized for Issuance under Equity Compensation Plans

 The
information required by Item 5 is incorporated by reference to our Definitive Proxy Statement for our 2024 annual stockholders'
meeting.

 ITEM
6. [Reserved]

 ITEM
7. Management's Discussion and Analysis of Financial Condition and Results of Operations

 The
discussion below contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially
from those anticipated in these forward-looking statements as a result of various factors, including those which are discussed in the
section titled "Risk Factors." Also see "Statement Regarding Forward-Looking Statements" preceding Part I.

 The
following discussion and analysis should be read in conjunction with our accompanying consolidated financial statements and the notes
thereto.

 Overview

 Strawberry
Fields REIT, Inc. (the "Company") is engaged in the ownership, acquisition, financing and triple-net leasing of skilled nursing
facilities and other post-acute healthcare properties. Currently, our portfolio consists of 100 healthcare properties with an aggregate
of 12,449 licensed beds. We hold fee title to 97 of these properties and hold three properties under long-term leases. These properties
are located in Arkansas, Illinois, Indiana, Kentucky, Michigan, Ohio, Oklahoma, Tennessee and Texas. We generate substantially all our
revenues by leasing our properties to tenants under long-term leases primarily on a triple-net basis, under which the tenant pays the
cost of real estate taxes, insurance and other operating costs of the facility and capital expenditures. Each healthcare facility located
at our properties is managed by a qualified operator with an experienced management team.

 We
employ a disciplined approach in our investment strategy by investing in healthcare real estate assets. We seek to invest in assets that
will provide attractive opportunities for dividend growth and appreciation in asset value, while maintaining balance sheet strength and
liquidity, thereby creating long-term stockholder value. We expect to grow our portfolio by diversifying our investments by tenant, facility
type and geography.

 We
are entitled to monthly rent paid by the tenants and we do not receive any income or bear any expenses from the operations of such facilities.
As of the date of this report, the aggregate annualized average base rent under the leases for our properties was approximately $102.3
million.

 We
elect to be taxed as a REIT for U.S. federal income tax purposes commencing with our taxable year ending December 31, 2022. We are organized
in an UPREIT structure in which we own substantially all of our assets and conduct substantially all of our business through the Operating
Partnership. We are the general partner of the Operating Partnership and as of the date of the report own approximately 12.6% of
the outstanding OP units.

 Recent
Developments

 On
May 1, 2023, the Operating Partnership paid $15.6 million to redeem 1,454,308 OP units granted to the sellers of five properties in Tennessee
and one in Kentucky the Company acquired in 2021. In connection with this payment, the Company contributed $0.7 million to the Operating
Partnership and was issued 65,455 OP units.

 On
June 19, 2023, the BVI Company completed an initial offering of Series D Bonds with a par value of NIS 82.9 million ($22.9 million).
The Series D Bonds were issued at par and the interest rate is 9.1%. During July 2023, the BVI Company issued additional Series D Bonds
with a par value of NIS 70.0 million and raised a gross amount of $19.2 million (NIS 69.8 million). The Bonds were issued at a price
of 99.7%.

 On
August 25, 2023, the Company acquired 24 healthcare facilities (19 properties) located in Indiana (the "Indiana Facilities")
for $102.0 million. The Indiana Facilities are comprised of 19 skilled nursing facilities with 1,659 licensed beds and five assisted
living facilities with 193 beds, of which 29 beds are licensed. Annualized straight line rent for the facilities is expected to equal
$12.7 million representing a weighted average lease yield of 12.4%.

 On
October 30, 2023 the Company entered into a lease agreement to re-tenant the three skilled nursing facilities located in Texas. The lease
is for 10 years with annual escalations of 2.5%. The lease commenced on December 1, 2023.

 On
November 8, 2023, the Company paid off the remaining balance of the Series A Bonds, subject to a $900 prepayment penalty because the
Bonds were repaid before the scheduled maturity date of July 2024.

 On
December 12, 2023 the Company entered into a lease for two skilled nursing facilities with 226 licensed beds near Johnson City, Tennessee.
The lease includes a purchase option which the Company intends to exercise once certain conditions precedent are met. The lease commenced
on January 1, 2024.

 On February 8 2024, the BVI Company
issued additional Series D Bonds with a par value of NIS 100.0 million and raised a gross amount of $26.7 million (NIS 98.0 million).
The Bonds were issued at a price of 106.3%.

 On February 20, 2024 the Company entered into a new, replacement master lease for the properties included in the Indiana
acquisition completed in August of 2023. The tenant remains a group of tenants affiliated with two of the Company's directors, Moishe
Gubin and Michael Blisko. The new master lease has an initial term of ten years and is subject to 2 five-year extensions. The initial
annual base rent for the properties is $14.5 million dollars and is subject to annual increases of 3%. In connection with the new master
lease, the existing purchase option held by the tenant, which was granted by the prior owner of the properties, of $127.0 million was
terminated. Consideration for the termination of the purchase option and inducement for entering into the new, replacement master lease
was $18.0 million paid to the tenants. The $18.0 million payment was funded by cash and the proceeds from the additional
Series D Bond issuance in February 2024.

 As
of the date of this report, none of the Company's tenants are delinquent on the payment of rent, and there have been no
requests to amend the terms of their respective leases to reduce current or future lease payments.

Party Tenants

 As
a landlord, the Company does not control the operations of its tenants, including related party tenants, and is not able to cause its
tenants to take any specific actions to address trends in occupancy at the facilities operated by its tenants, other than to monitor
occupancy and income of its tenants, discuss trends in occupancy with tenants and possible responses, and, in the event of a default,
to exercise its rights as a landlord. However, Moishe Gubin, our Chairman and Chief Executive Officer, and Michael Blisko, one of our
directors, as the controlling members of 64 of our tenants and related operators, have the ability to obtain information regarding these
tenants and related operators and cause the tenants and operators to take actions, including with respect to occupancy.

 Results
of Operations

 Operating
Results

 Year
Ended December 31, 2023 Compared to Year Ended December 31, 2022:

 Year Ended

 Increase /

 Percentage

 (dollars in thousands)

 2023

 2022

 (Decrease)

 Difference

 Revenues:

 Rental revenues

 $
 99,805

 $
 92,543

 $
 7,262

 7.8
 %

 Expenses:

 26,207

 25,530

 2.7
 %

 Amortization

 3,028

 3,028

 -

 -

 Loss on real estate investment impairment

 2,451

 -

 2,451

 %

 General and administrative expenses

 5,662

 6,012

 (350
)

 (5.8
)%

 Property and other taxes

 14,459

 13,131

 1,328

 10.1
 %

 Facility rent expenses

 5.1
 %

 Credit for doubtful accounts

 -

 (5,636
)

 5,636

 %

 Total Expenses

 52,366

 42,597

 9,769

 22.9
 %

 Interest expense, net

 24,443

 20,507

 3.936

 19.2
 %

 Amortization of interest expense

 11.1
 %

 Mortgage Insurance Premium

 1,671

 1,704

 1.9
 %

 Total Interest Expenses

 26,674

 22,715

 3,959

 17.4
 %

 Other (loss) income

 Other (loss) income

 (983
)

 (1,103
)

 (919.2
)%

 Foreign currency transaction gain (loss)

 (10,932
)

 11,394

 104.2
 %

 Net Income

 3,825

 23.3
 %

 Net income attributable to non-controlling interest

 (17,748
)

 (14,567
)

 3,181

 21.8
 %

 Net Income attributable to common stockholders

 2,496

 1,852

 34.8
 %

 Basic and diluted income per common share

 $
 0.39

 $
 0.31

 -

 -

 Rental
revenues: Rental revenues during 2023 increased by $7.3 million or 7.8% compared to fiscal year 2022, The additional rental
income arising from the renegotiation of certain leases, the receipt of rent from the acquisition of 24 facilities and additional
property taxes being reimbursed by the tenants.

and Amortization: Increase in depreciation of $0.7 million or 2.7% from fiscal year 2022 to fiscal year 2023 is primarily due to
$102.0 million of new real estate investments in the third quarter of 2023.

 Loss
on real estate investment impairment: In February 2023, one facility under one of our Southern Illinois master leases was closed.
The closure was made at the request of the tenant and was mainly for efficiency reasons. This facility was leased under a master lease
with two other facilities. The closure did not result in any reduction in the aggregate rent payable under the master lease, which has
been paid without interruption. As a result of the closure, the Company is seeking to sell the property. Since the facility is no longer
licensed to operate as a skilled nursing facility, the Company wrote off its remaining book value.

 General
and Administrative Expense: The decrease in general and administrative expenses of $(0.4) million or 5.8% during fiscal year 2023 compared
to fiscal year 2022 is primarily due to lower operating expenses incurred in the year ended December 31, 2023

and other Taxes: The increase in property taxes of $1.3 million or 10.1% during fiscal year 2023 compared to fiscal year 2022 is
primarily due was primarily due to increases in real estate taxes and franchise taxes partially as a result of the acquisition of the
Indiana Facilities.

 Credit
for Doubtful Accounts: During 2022, the Company recognized $5.6 million in income from the recovery of a written off asset
relating to the successful foreclosure of mortgages held by the Company on properties located in Massachusetts.

expense, net: The increase in interest expense of $3.9 million or 19.2% from Fiscal year 2022 to fiscal year 2023 is primarily
related to additional interest payments for Series D Bonds, a second commercial bank loan facility obtained in connection with the
acquisition of the Indiana Facilities, increases in the floating rate on the Company's commercial bank loan facilities and
additional interest on Series C Bonds that were issued in 2023.

 Foreign
Currency Transaction Gain (Loss): Our bond indebtedness is denominated in NIS. As a result, we are subject to potential foreign
currency transaction loss due to changes in the value of the U.S. dollar relative to the New Israel Shekel. In 2022, we recorded a
foreign currency transaction loss of $10.9 million in connection with the repayment of the Series B Bonds in 2022. There was a gain
of $0.5 million in foreign currency transactions for 2023.

 Other
(loss) income: The increase in other loss of $1.0 million was the result of a fee paid to an investment banking firm in connection
with the cancellation of an agreement with respect to a proposed financing transaction.

 Net
Income: The increase in net income from $16.4 million during the year ended December 31, 2022 to $20.2 million in the year ended
December 31, 2023 is primarily due to increases in rental revenue (net of increase in real estate taxes) and the decline in foreign
currency losses offset by an impairment loss, the decline in credit for doubtful accounts, and an increase in interest expense

 Liquidity
and Capital Resources

 To
qualify as a REIT for federal income tax purposes, we are required to distribute at least 90% of our REIT taxable income, determined
without regard to the dividends paid deduction and excluding any net capital gains, to our stockholders on an annual basis. Accordingly,
we intend to make, but are not contractually bound to make, regular quarterly dividends to common stockholders from cash flow from operating
activities. All such dividends are at the discretion of our board of directors.

 As
of December 31, 2023, we had cash and cash equivalents and restricted cash and equivalents of $37.8 million. We also had the ability
to offer additional Series C Bonds from the current outstanding of $60.8 loan up to $170.6 million and the ability to offer additional
Series D Bonds from the current outstanding of $42.2 million up to $121.9 million is subject to compliance with covenants and market
conditions.

 Liquidity
is a measure of our ability to meet potential cash requirements, including ongoing commitments to repay borrowings, fund and maintain
our assets and operations, make distributions to our stockholders and other general business needs. Our primary sources of cash include
operating cash flows and borrowings. Our primary uses of cash include funding acquisitions and investments consistent with our investment
strategy, repaying principal and interest on any outstanding borrowings, making distributions to our equity holders, funding our operations
and paying accrued expenses.

 Our
long-term liquidity needs consist primarily of funds necessary to pay for the costs of acquiring additional healthcare properties and
principal and interest payments on our debt. We expect to meet our long-term liquidity requirements through various sources of capital,
including future equity issuances or debt offerings, net cash provided by operations, long-term mortgage indebtedness and other secured
and unsecured borrowings.

 We
may utilize various types of debt to finance a portion of our acquisition activities, including long-term, fixed-rate mortgage loans,
variable-rate term loans and secured revolving lines of credit. As of December 31, 2023, on a consolidated basis, we had total indebtedness
of approximately $539.1 million, consisting of $271.4 million in HUD guaranteed debt, $102.9 million in net Series C Bonds and Series
D Bonds outstanding and $164.8 million in commercial mortgages. Under our Bonds and our commercial mortgages, we are subject to continuing covenants,
and future indebtedness that we may incur, may contain similar provisions. In the event of a default, the lenders could accelerate the
timing of payments under the debt obligations, and we may be required to repay such debt with capital from other sources, which may not
be available on attractive terms, or at all, which would have a material adverse effect on our liquidity, financial condition, results
of operations and ability to make distributions to our stockholders.

 Our
debt arrangements may require us to make a lump-sum or "balloon" payment at maturity. Our ability to make the balloon payments
due under our existing and future indebtedness will depend on our working capital at the time of repayment, our ability to obtain additional
financing or our ability to sell any property securing such indebtedness. At the time the balloon payment is due, we may or may not be
able to refinance the existing financing on terms as favorable as the original bond or loan or sell any related property at a price sufficient
to make the balloon payment. In addition, balloon payments and payments of principal and interest on our indebtedness may leave us with
insufficient cash to pay the distributions that we are required to pay to qualify and maintain our qualification as a REIT.

 Through
2027 there are four balloon payment obligations consisting of two payments of $52.6 million and $37.1 million due under the Series C Bonds
and Series D bond in 2026, respectively and payments of $86.0 million and $60.7 million due under our two commercial bank term loans
due in 2027 and 2028. We may also obtain additional financing that contains balloon payment obligations. These types of obligations may
materially adversely affect us, including our cash flows, financial condition and ability to make distributions.

 The
Company believes that its overall level of indebtedness is appropriate for the Company's business in light of its cash flow from
operations and value of its properties and is generally typical for owners of multiple healthcare properties. The Company expects to
generate sufficient positive cash flow from operations to meet its ongoing debt service obligations and the distribution requirements
for maintaining REIT status.

 Cash
Flows

 The
following table presents selected data from our consolidated statements of cash flows:

 Years Ended December 31,

 2023

 2022

 (dollars in thousands)

 Net cash provided by operating activities

 $
 54,944

 $
 50,926

 Net cash used in investing activities

 (106,348
)

 (10,101
)

 Net cash provided by (used in) financing activities

 43,458

 (47,249
)

 Net decrease in cash and cash equivalents and restricted cash and cash equivalents

 (7,946
)

 (6,424
)

 Cash and cash equivalents, and restricted cash and cash equivalents beginning of year

 45,704

 52,128

 Cash and cash equivalents and restricted cash and cash equivalents, end of year

 $
 37,758

 $
 45,704

 Net
cash provided by operating activities increased $4.0 million for the year ended December 31, 2023 compared to the year ended December
31, 2022, primarily due to an increase of $6.9 million increase in accounts payable and accrued liabilities.

 Cash
used in investing activities for the year ended December 31, 2023, primarily consisted of a net increase in investment properties in
the amount of $108.1 million and a decrease in notes receivable of $1.7 million. The decrease of $10.1 million during the year ended
December 31, 2022 is due to an increase in note receivable of $9.6 million..

 Cash
flows generated from financing activities for the year ended December 31, 2023 were primarily comprised of $52.4 million in new bond
proceeds, REIT dividends of $2.9 million, a $20.6 million in distributions to the non-controlling interest holders and $69.2 million new
borrowings under a mortgage loan facility. These amounts were offset by $24.0 million in principal bond payments, and $14.0 million of
repayment of senior debt. Cash flows used in financing activities for the year ended December 31, 2022 were primarily comprised of $106
million in principal bond payments, REIT dividends of $0.6 million, a $10.9 million in distributions to the non-controlling interest holders
and a decrease of $33.2 million in senior debt offset by a $105.0 million new borrowings under a mortgage loan facility.

 Indebtedness

 Mortgage
Loans Guaranteed by HUD

 As
of December 31, 2023, we had non-recourse mortgage loans of $271.4 million from third party lenders that were guaranteed by HUD.

 Each
loan is secured by first mortgages on certain specified properties, interests in the leases for these properties and second liens on
the operator's assets. In the event of default on any single loan, the loan agreement provides that the applicable lender may require
the tenants for the property securing the loan to make all rental payments directly to the lender. In exchange for the HUD guarantee,
we pay HUD, on an annual basis, 0.65% of the principal balance of each loan as mortgage insurance premium, in addition to the interest
rate denominated in each loan agreement. As a result, the overall average interest rate paid with respect to the HUD guaranteed loans
as of December 31, 2023, was 3.97% per annum (including the mortgage insurance payments). The loans have an average maturity of 22 years.

 Commercial
Bank Term Loan

 On
March 21, 2022, the Company closed a mortgage loan facility with a commercial bank pursuant to which the Company borrowed approximately
$105 million. The facility provides for monthly payments of principal based on a 20-year amortization with a balloon payment due in March
2027. The rate is based on the one-month Secured Overnight Financing Rate ("SOFR") plus a margin of 3.5% and a floor 4%
(as of the December 31, 2023 the rate was 8.84%). As of December 31, 2023, total outstanding principal amount was $98.8 million. This
loan is collateralized by 21 properties owned by the Company. The loan proceeds were used to repay the Series B Bonds and prepay commercial
loans not secured by HUD guarantees. The Company recognized a foreign currency transaction loss of approximately $10.1 million in connection
with the repayment of the Series B Bonds during the year ended December 31, 2022.

 On
August 25, 2023, the Company closed a mortgage loan facility with a commercial bank pursuant to which the Company borrowed approximately
$66 million. The facility provides for monthly payments of interest and payment of principal will start on August 2024 based on a 20-year
amortization with a balloon payment due in August 2028. The rate is based on the one-month Secured Overnight Financing Rate ("SOFR")
plus a margin of 3.5% and a floor of 4% (as of the December 31, 2023, the rate was 8.84%). As of December 31, 2023, total outstanding
principal amount was $66 million. This loan is collateralized by 19 properties owned by the Company. The loan proceeds were used to
acquire the Indiana facilities.

 Both
credit facilities are subject to financial covenants which are consist of (i) a covenant that the ratio of the Company's indebtedness
to its EBITDA cannot exceed 8.0 to 1, (ii) a covenant that the ratio of the Company's net operating income to its debt service
before dividend distribution is at least 1.20 to 1.00 for each fiscal quarter as measured pursuant to the terms of the loan agreement
(iii) a covenant that the ratio of the Company's net operating income to its debt service after dividend distribution is at least
1.05 to 1.00 for each fiscal quarter as measured pursuant to the terms of the loan agreement, and (iii) a covenant that the Company's
GAAP equity is at least $20,000,000. As of December 31, 2023, the Company was in compliance with the loan covenants.

 Outstanding
Bond Debt

 As
of December 31, 2023, the Company had outstanding Series C Bonds and Series D Bonds.

A Bonds

 In
November 2015, the Company, through a subsidiary, issued Series A Bonds in the face amount of NIS 265.2 million ($68 million) and received
the net amount after issuance costs of NIS 251.2 million ($64.3 million). Since then the Company extended the series amount twice in
September 2016 and May 2017 and received a combined net amount of $30.1 million. The Series A Bonds had an original interest rate of
6.4% per annum. The Series A Bonds were paid off on November 8, 2023.

C Bonds

 In
July 2021, the BVI Company completed an initial offering of Series C Bonds with a par value of NIS 208.0 million ($64.7 million). The
Series C Bonds were issued at par. During February 2023, the BVI Company issued additional Series C Bonds in the face amount of NIS 40.0
million ($11.2 million) and raised a net amount of NIS 38.1 million ($10.7 million). These Series C Bonds were issued at a price of 95.25%.

 As
of December 31, 2023, the outstanding principal amount of the Series C Bonds was NIS 220.5 million ($60.7 million).

 The
Series C Bonds are traded on the TASE.

D Bonds

 In
June 2023, the BVI Company completed an initial offering of Series D Bonds with a par value of NIS 82.9 million ($22.9 million). The
Series D Bonds were issued at par. During August 2023, the BVI Company issued additional Series D Bonds in the face amount of NIS 70.0
million ($19.3 million) and raised a net amount of NIS 152.9 million ($42.2 million). These Series D Bonds were issued at a price of
99.7%. As of December 31, 2023, the Series D Bonds had an outstanding principal balance of approximately NIS 152.9 ($42.2 million).

 Summary
of fixed and variable loans:

 2023

 2022

 (Amounts in $000s)

 Fixed rate loans

 $
 374,335

 $
 351,566

 Variable rate loans

 164,810

 105,225

 Gross Notes Payable and other Debt

 $
 539,145

 $
 456,791

 Funds
From Operations ("FFO")

 The
Company believes that net income as defined by GAAP is the most appropriate earnings measure. We also believe that funds from operations
("FFO"), as defined in accordance with the definition used by the National Association of Real Estate Investment Trusts ("NAREIT"),
and adjusted funds from operations ("AFFO") are important non-GAAP supplemental measures of our operating performance. Because
the historical cost accounting convention used for real estate assets requires straight-line depreciation (except on land), such accounting
presentation implies that the value of real estate assets diminishes predictably over time. However, since real estate values have historically
risen or fallen with market and other conditions, presentations of operating results for a REIT that use historical cost accounting for
depreciation could be less informative. Thus, NAREIT created FFO as a supplemental measure of operating performance for REITs that excludes
historical cost depreciation and amortization, among other items, from net income, as defined by GAAP. FFO is defined as net income,
computed in accordance with GAAP, excluding gains or losses from real estate dispositions, plus real estate depreciation and amortization.
AFFO is defined as FFO excluding the impact of straight-line rent, above-/below-market leases, non-cash compensation and certain non-recurring
items. For the year ended December 31, 2023 and 2022, we excluded as non-recurring items a gain in the amount of $0.5 million and a loss
of $10.9 million, respectively, in reclassification of foreign currency transactions the Company recorded with respect to foreign currency
fluctuations that the Company realized at the time of bond principal payment. We believe that the use of FFO, combined with the required
GAAP presentations, improves the understanding of our operating results among investors and makes comparisons of operating results among
REITs more meaningful. We consider FFO and AFFO to be useful measures for reviewing comparative operating and financial performance because,
by excluding the applicable items listed above, FFO and AFFO can help investors compare our operating performance between periods or
as compared to other companies.

 While
FFO and AFFO are relevant and widely used measures of operating performance of REITs, they do not represent cash flows from operations
or net income as defined by GAAP and should not be considered an alternative to those measures in evaluating our liquidity or operating
performance. FFO and AFFO also do not consider the costs associated with capital expenditures related to our real estate assets nor do
they purport to be indicative of cash available to fund our future cash requirements. Further, our computation of FFO and AFFO may not
be comparable to FFO and AFFO reported by other REITs that do not define FFO in accordance with the current NAREIT definition or that
interpret the current NAREIT definition or define AFFO differently than we do.

 The
following table reconciles our calculations of FFO and AFFO for the years ended December 31, 2023 and 2022, to net income, the most directly
comparable GAAP financial measure (in thousands):

 FFO
and AFFO:

 Year Ended

 2023

 2022

 Net income

 $

 $

 Depreciation and amortization

 29,235

 28,558

 Funds from Operations

 49,479

 44,977

 Adjustments to FFO:

 Credit for doubtful
 accounts (1)

 -

 (5,636
)

 Straight-line rent

 (30
)

 (272
)

 Straight-line rent receivable write-off (2)

 1,075

 Contact cancellation expense for proposed financing (3)

 1,000

 -

 Loss on real estate impairment (4)

 2,451

 -

 Foreign currency transaction (gain) loss

 (462
)

 10,932

 Funds from Operations, as Adjusted

 $
 52,668

 $
 51,076

 (1)
During the year ended December 31, 2022, the Company recovered $4.4 million in cash with respect to foreclosure sales of assets in Massachusetts.
In addition, the Company recognized $1.2 million with respect to a foreclosed property in Massachusetts.

 (2)
The Company recognized a loss of $1,075,000 in the second quarter of 2022 due to the write-off of straight-line rent receivables related
to the Southern Illinois facilities

 (3)
The Company incurred a non-recurring expense of $1.0 million in the second quarter of 2023 in connection with the cancellation of a contract
with an investment banking firm related to a proposed financing.

 (4)
 Loss on real estate investment impairment: In February 2023, one facility under one of our Southern Illinois master leases was
closed. The closure was made at the request of the tenant and was mainly for efficiency reasons. This facility was leased under a master
lease with two other facilities. The closure did not result in any reduction in the aggregate rent payable under the master lease, which
was paid without interruption. As a result of the closure, the Company is seeking to sell the property. Since the facility is no longer
licensed to operate as a skilled nursing facility, the Company wrote off its remaining book value.

 Dividend
Plans

 We
are required to pay dividends in order to maintain our REIT status and we expect to make quarterly dividend payments in cash with the
annual dividend amount no less than 90% of our annual REIT taxable income, determined without regard to the dividends paid deduction
and excluding any net capital gains.

 Critical
Accounting Policies

 The
preparation of consolidated financial statements in conformity with generally accepted accounting principles, or GAAP, in the United
States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure
of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during
the reporting period. Management considers accounting estimates or assumptions critical in either of the following cases:

the nature of the estimates or assumptions is material because of the levels of subjectivity and judgment needed to account for matters
that are highly uncertain and susceptible to change; and

the effect of the estimates and assumptions is material to the consolidated financial statements.

 Management
believes the current assumptions used to make estimates in the preparation of the consolidated financial statements are appropriate and
not likely to change in the future. However, actual experience could differ from the assumptions used to make estimates, resulting in
changes that could have a material adverse effect on our consolidated results of operations, financial position and/or liquidity. These
estimates will be made and evaluated on an on-going basis using information that is available as well as various other assumptions believed
to be reasonable under the circumstances.

 The
following presents information about our critical accounting policies including the material assumptions used to develop significant
estimates. Since the Company was recently formed and just completed the formation transactions, certain of these critical accounting
policies contain discussion of judgments and estimates that have not yet been required by management but that it believes may be reasonably
required of it to make in the future.

 Principles
of Consolidation

 The
consolidated financial statements include the accounts of our Operating Partnership and its wholly owned subsidiaries, and all material
intercompany transactions and balances are eliminated in consolidation.

 From
inception, we continually evaluate all of our transactions and investments to determine if they represent variable interests subject
to the variable interest entity, or VIE, consolidation model and then determine which business enterprise is the primary beneficiary
of its operations. We make judgments about which entities are VIEs based on an assessment of whether (i) the equity investors as a group,
if any, do not have a controlling financial interest, or (ii) the equity investment at risk is insufficient to finance that entity's
activities without additional subordinated financial support. We consolidate investments in VIEs when we are determined to be the primary
beneficiary. This evaluation is based on our ability to direct and influence the activities of a VIE that most significantly impact that
entity's economic performance.

 For
investments not subject to the variable interest entity consolidation model, we will evaluate the type of rights held by the limited
partner(s) or other member(s), which may preclude consolidation in circumstances in which the sole general partner or managing member
would otherwise consolidate the limited partnership. The assessment of limited partners' or members' rights and their impact
on the presumption of control over a limited partnership or limited liability corporation by the sole general partner or managing member
should be made when an investor becomes the sole general partner or managing member and should be reassessed if (i) there is a change
to the terms or in the exercisability of the rights of the limited partners or members, (ii) the sole general partner or member increases
or decreases its ownership in the limited partnership or corporation, or (iii) there is an increase or decrease in the number of outstanding
limited partnership or membership interests.

 Our
ability to assess correctly our influence or control over an entity at inception of our involvement or on a continuous basis when determining
the primary beneficiary of a VIE affects the presentation of these entities in our consolidated financial statements. Subsequent evaluations
of the primary beneficiary of a VIE may require the use of different assumptions that could lead to identification of a different primary
beneficiary, resulting in a different consolidation conclusion than what was determined at inception of the arrangement.

 Revenue
Recognition

 We
recognize rental revenue for operating leases on a straight-line basis over the lease term when collectability is reasonably assured
and the tenant has taken possession or controls the physical use of a leased asset. For assets acquired subject to leases, we recognize
revenue upon acquisition of the asset provided the tenant has taken possession or control of the physical use of the leased asset. If
the lease provides for tenant improvements, we determine whether the tenant improvements, for accounting purposes, are owned by the tenant
or us. When we are the owner of the tenant improvements, the tenant is not considered to have taken physical possession or have control
of the physical leased asset until the tenant improvements are substantially completed.

 When
the tenant is the owner of the tenant improvements, any tenant improvement allowance funded is treated as a lease incentive and amortized
as a reduction of revenue over the lease term. The determination of ownership of the tenant improvements is subject to significant judgment.
If our assessment of the owner of the tenant improvements for accounting purposes were different, the timing and amount of our revenue
recognized would be impacted.

 We
monitor the liquidity and creditworthiness of our tenants and operators on a continuous basis to determine the need for an allowance
for doubtful accounts, including an allowance for operating lease straight-line rent receivables, for estimated losses resulting from
tenant defaults or the inability of tenants to make contractual rent and tenant recovery payments. This evaluation considers industry
and economic conditions, property performance, credit enhancements and other factors. For straight-line rent amounts, our assessment
is based on income recoverable over the term of the lease. We exercise judgment in establishing allowances and consider payment history
and current credit status in developing these estimates. These estimates may differ from actual results, which could be material to our
consolidated financial statements. As of December 31, 2023 and 2022 we determined that no allowance was necessary to cover the potential
loss of rent from our tenants.

 Real
Estate Investments

 We
make estimates as part of our allocation of the purchase price of acquisitions (whether an asset acquisition acquired via purchase/leaseback
or a business combination via an asset acquired from the current lessor) to the various components of the acquisition based upon the
relative fair value of each component for asset acquisitions and at fair value of each component for business combinations. In making
estimates of fair values for purposes of allocating purchase prices of acquired real estate, we utilize a number of sources, including
independent appraisals that may be obtained in connection with the acquisition or financing of the respective property and other market
data. We also consider information obtained about each property as a result of our pre-acquisition due diligence, marketing and leasing
activities in estimating the fair value of the tangible and intangible assets acquired. The most significant components of our allocations
are typically the allocation of fair value to land and buildings and, for certain of our acquisitions, in-place leases and other intangible
assets. In the case of the fair value of buildings and the allocation of value to land and other intangibles, the estimates of the values
of these components will affect the amount of depreciation and amortization we record over the estimated useful life of the property
acquired or the remaining lease term. In the case of the value of in-place leases, including the assessment as to the existence of any
above-or below-market in-place leases, our management makes its best estimates based on the evaluation of the specific characteristics
of each tenant's lease. Factors considered include estimates of carrying costs during hypothetical expected lease-up periods, market
conditions and costs to execute similar leases. These assumptions affect the amount of future revenue that we will recognize over the
remaining lease term for the acquired in-place leases. The values of any identified above-or below-market in-place leases are based on
the present value of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management's
estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining non-cancelable
term of the lease, or for below-market in-place leases including any bargain renewal option terms. Above-market lease values are recorded
as a reduction of rental income over the lease term while below-market lease values are recorded as an increase to rental income over
the lease term. The recorded values of in-place lease intangibles are recognized in amortization expense over the initial term of the
respective leases.

 We
evaluate each purchase transaction to determine whether the acquired assets meet the definition of a business. Transaction costs related
to acquisitions that are not deemed to be businesses are included in the cost basis of the acquired assets, while transaction costs related
to acquisitions that are deemed to be businesses are expensed as incurred.

 Asset
Impairment

 Real
estate asset impairment losses are recorded when events or changes in circumstances indicate the asset is impaired and the estimated
undiscounted cash flows to be generated by the asset are less than its carrying amount. Management assesses the impairment of properties
individually and impairment losses are calculated as the excess of the carrying amount over the fair value of assets to be held and used,
and carrying amount over the fair value less cost to sell in instances where management has determined that we will dispose of the property.
In determining fair value, we use current appraisals or other third-party opinions of value and other estimates of fair value such as
estimated discounted future cash flows.

 Factors
That May Influence Future Results of Operations

 Our
revenues are primarily derived from rents we earn pursuant to the lease agreements we enter into with our tenants. Our tenants operate
in the healthcare industry, generally providing nursing and medical care to patients. The capacity of our tenants to pay our rents is
dependent upon their ability to conduct their operations at profitable levels. We believe that the business environment of the industry
segments in which our tenants operate is generally positive for efficient operators. However, our tenants' operations are subject
to economic, regulatory and market conditions that may affect their profitability, which could impact our results of operations. Accordingly,
we actively monitor certain key factors, including changes in those factors that we believe may provide early indications of conditions
that may affect the level of risk in our lease portfolio.

 Key
factors that we consider in underwriting prospective tenants and borrowers and in monitoring the performance of existing tenants include,
but are not limited to, the following:

the current, historical and projected cash flow and operating margins of each tenant and at each facility;

the ratio of our tenants' operating earnings both to facility rent and to facility rent plus other fixed costs, including debt
costs;

the quality and experience of the tenant and its management team;

construction quality, condition, design and projected capital needs of the facility;

the location of the facility;

local economic and demographic factors and the competitive landscape of the market;

the effect of evolving healthcare legislation and other regulations on our tenants' profitability and liquidity;

the payor mix of private, Medicare and Medicaid patients at the facility; and

whether such tenants are related parties.

 One
of our goals is to reduce our dependence on related party tenants in order to diversify our tenant base. Although we expect to continue
to lease properties to related party tenants in markets in which the related party tenants have substantial experience and operations,
we intend to lease properties in other markets to unrelated tenants if we are able to identify qualified operators. Additionally, we
will consider leasing properties to unrelated parties in markets in which related parties operate if we are able to identify qualified
operators that are willing to lease properties on terms that are no less favorable than those available from related parties.

 We
also actively monitor the credit risk of our tenants. The methods we use to evaluate a tenant's liquidity and creditworthiness
include reviewing certain periodic financial statements, operating data and clinical outcomes data of the tenant. Over the course of
a lease, we also have regular meetings with the facility management teams. Through these means we are able to monitor a tenant's
credit quality.

 Certain
business factors, in addition to those described above that directly affect our tenants, which in turn will likely materially influence
our future results of operations:

the financial and operational performance of our tenants;

trends in the cost and availability of capital, including market interest rates, which our prospective tenants may use for their working
capital financing;

reductions in reimbursements from Medicare, state healthcare programs and commercial insurance providers that may reduce our tenants'
profitability and our lease rates; and

competition from other financing sources.

 Inflation

 We
are exposed to inflation risk as income from long-term leases are a main source of our cash flows from operations. For our leased properties,
we expect there to be provisions in the majority of our leases that will protect us from the impact of inflation. These provisions may
include rent escalators, and leases that are triple-net. However, due to the long-term nature of the anticipated leases, among other
factors, the leases may not re-set frequently enough to cover inflation.

 ITEM
7A. Quantitative and Qualitative Disclosures About Market Risk

 Market
risk includes risks that arise from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices and other
market changes that affect market sensitive instruments. In pursuing our business and investment objectives, we expect that the primary
market risk to which we will be exposed is interest rate risk.

 We
may be exposed to the effects of interest rate changes primarily as a result of long-term debt used to acquire properties. As of December
31, 2023, we had $60.8 million net outstanding under our Series C Bonds, which bear interest at a fixed rate of 5.7% per annum, $42.2
million outstanding under our Series D Bonds, which bear interest at a fixed rate of 9.1% per annum, and $436.2 million in senior debt
notes, of which $164.8 million (37.78% of total debt) bear interest at variable rate equal to one month SOFR plus a margin. At December
31, 2023, one month SOFR was 5.34%. Assuming no increase in the amount of our variable interest rate debt, if one-month SOFR increased
100 basis points, our annual cash flow would decrease by approximately $1.6 million. Our interest rate risk management objectives are
to limit the impact of interest rate changes on earnings and cash flows and to lower overall borrowing costs. To achieve our objectives,
we may borrow at fixed rates or variable rates. We also may enter into derivative financial instruments such as interest rate swaps and
caps in order to mitigate our interest rate risk on a related financial instrument.

 In
addition to changes in interest rates, the value of our future investments is subject to fluctuations based on changes in local and regional
economic conditions, change in currency rates between the Israeli Shekel and the U.S. Dollar and changes in the creditworthiness of tenants/operators,
which may affect our ability to refinance our debt if necessary.

 I TEM
8. Financial Statements and Supplementary Data

 See
the Index to Consolidated Financial Statements on page F-1 of this report.

 ITEM
9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures

 None.

 ITEM
9A. Controls and Procedures

 Our
management, under the supervision and with the participation of our principal executive and financial officer, is responsible for and
has evaluated the effectiveness of our disclosure controls and procedures in ensuring that the information required to be disclosed in
our filings under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's
rules and forms, including ensuring that such information is accumulated and communicated to our company's management, as appropriate,
to allow timely decisions regarding required disclosure. Based on such evaluation, our principal executive and financial officer have
concluded that such disclosure controls and procedures were effective as of December 31, 2023 (the end of the period covered by this
Annual Report).

 Management's
Annual Report on Internal Control Over Financial Reporting

 This
report does not include a report of management's assessment regarding internal control over financial reporting or an attestation
report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public
companies.

 Limitations
on Controls

 Our
system of internal control over financial reporting was designed to provide reasonable assurance regarding the preparation and fair presentation
of published financial statements in accordance with accounting principles generally accepted in the United States. All internal control
systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide
only reasonable assurance and may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.

 Changes
in Internal Control over Financial Reporting

 There
was no change in our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially
affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 ITEM
9B. Other Information

 During
the fourth quarter of 2023, no director or officer adopted any insider trading arrangement contemplated by 17 CFR Section
229.408.

 The Company has adopted a Code of Business Conduct & Ethics, which contains insider trading policies and procedures
governing the purchase, sale, and/or other dispositions of the Company's securities by directors, officers and employees, or the
registrant itself, that have been designed to promote compliance with insider trading laws, rules and regulations, and the NYSE American's
listing standards.

 ITEM
9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

 Not
applicable.

 PART
III

 ITEM
10. Directors, Executive Officers and Corporate Governance

 The
information required under Item 10 is incorporated herein by reference to our definitive proxy statement to be filed with the SEC within
120 days after the end of our fiscal year ended December 31, 2023 in connection with our 2024 Annual Meeting of Stockholders.

 ITEM
11. Executive Compensation

 The
information required under Item 11 is incorporated herein by reference to our definitive proxy statement to be filed with the SEC within
120 days after the end of our fiscal year ended December 31, 2023 in connection with our 2024 Annual Meeting of Stockholders.

 ITEM
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 The
information required under Item 12 is incorporated herein by reference to our definitive proxy statement to be filed with the SEC within
120 days after the end of our fiscal year ended December 31, 2023 in connection with our 2024 Annual Meeting of Stockholders.

 The following table discloses the number of outstanding options, warrants
and rights granted to participants by the Company under the equity compensation plans, as well as the number of securities remaining available
for future issuance under these plans as of December 31, 2023.

 Number of securities to be
issued upon exercise of
outstanding options, warrants
and rights (a)

 Weighted average exercise
price of outstanding options,
warrants and rights (b)

 Number of securities remaining
available for future issuance under equity
compensation plans (excluding
securities reflected in column (a)) (c)

 Equity compensation plans approved by security holders

 -

 -

 225,100

 Equity compensation plans not approved by security holders

 -

 -

 -

 Total

 -

 -

 225,100

 ITEM
13. Certain Relationships and Related Transactions, and Director Independence

 Additional
information required under Item 13 is incorporated herein by reference to our definitive proxy statement to be filed with the SEC within
120 days after the end of our fiscal year ended December 31, 2023 in connection with our 2024 Annual Meeting of Stockholders.

 ITEM
14. Principal Accountant Fees and Services

 The
information required under Item 14 is incorporated herein by reference to our definitive proxy statement to be filed with the SEC within
120 days after the end of our fiscal year ended December 31, 2023 in connection with our 2024 Annual Meeting of Stockholders.

 PART
IV

 ITEM
15. Exhibit and Financial Statement Schedules

Statements

 (1)
Consolidated Financial Statements:

 See
Index to Consolidated Financial Statements at page F-1.

 (2)
Financial Statement Schedules

III: Real Estate and Accumulated Depreciation

 Note:
All other schedules have been omitted because the required information is presented in the financial statements and the related notes
or because the schedules are not applicable.

 (3)
Exhibits:

 The
exhibits listed in the accompanying index to exhibits are filed as part of, or incorporated by reference into, this Annual Report.

 EXHIBIT

 Exhibit

 Description

 3.1

 Articles of Amendment and Restatement of Strawberry Fields REIT, Inc., incorporated herein by reference to Exhibit 3.1 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 3.2

 Amended and Restated Bylaws of Strawberry Fields REIT, Inc., incorporated herein by reference to Exhibit to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 4.1*

 Description of Capital Stock

 10.1

 Deed of Trust dated April 23, 2018, between Strawberry Fields REIT, LTD and Mishmeret Trust Services Company Ltd..incorporated herein by reference to Exhibit 10.1 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.2

 Deed of Trust dated November 24, 2015, between Strawberry Fields REIT, LTD and Mishmeret Trust Services Company Ltd., incorporated herein by reference to Exhibit 10.2 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.3

 Deed of Trust dated July 27, 2021 between Strawberry Fields REIT, LTD and Mishmeret Trust Services Company Ltd., incorporated herein by reference to Exhibit 10.3 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.4

 First Amended and Restated Agreement of Limited Partnership dated June 1, 2021 of Strawberry Fields Realty LP, incorporated herein by reference to Exhibit 10.4 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.5

 Contribution Agreement dated June 8, 2021 between Strawberry Fields REIT, Inc., Strawberry Fields REIT, LLC and of Strawberry Fields Realty LP., incorporated herein by reference to Exhibit 10.5 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.6

 Tax Protection Agreement effective as of June 8, 2021 among Strawberry Fields Realty LP, Strawberry Fields REIT, Inc. and Strawberry Fields REIT, LLC., incorporated herein by reference to Exhibit 10.6 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.7

 Strawberry Fields REIT, Inc. 2021 Equity Incentive Plan, incorporated herein by reference to Exhibit 10.7 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.8

 Term Loan and Security Agreement dated March 18, 2022, by and among Strawberry Fields Realty LP and certain subsidiaries thereof named as Borrowers, and Popular Bank, as Agent and Lender., incorporated herein by reference to Exhibit 10.8 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 10.9

 Indemnification Agreement effective January 13, 2020 between the Company and Essel Bailey incorporated herein by reference to Exhibit 10.1 to the Form 10-Q filed with the Securities and Exchange Commission as of September 8, 2022.

 10.10

 Indemnification Agreement effective January 13, 2020 between the Company and Jack Levine Bailey incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed with the Securities and Exchange Commission as of September 8, 2022.

 10.11

 Indemnification Agreement effective January 13, 2020 between the Company and Michael Blisko incorporated herein by reference to Exhibit 10.3 to the Form 10-Q filed with the Securities and Exchange Commission as of September 8, 2022.

 10.12

 Indemnification Agreement effective January 13, 2020 between the Company and Moishe Gubin incorporated herein by reference to Exhibit 10.4 to the Form 10-Q filed with the Securities and Exchange Commission as of September 8, 2022.

 10.13

 Indemnification Agreement effective January 13, 2020 between the Company and Reid Shapiro incorporated herein by reference to Exhibit 10.5 to the Form 10-Q filed with the Securities and Exchange Commission as of September 8, 2022.

 10.14

 Deed of Trust dated June 19, 2023, between Strawberry Fields REIT, LTD and Mishmeret Trust Services Company Ltd..incorporated herein by reference to Exhibit 10.9 to the Registration Statement on Form 10 filed with the Securities and Exchange Commission as of July 12, 2022.

 *21.1

 List of Subsidiaries of the Registrant

 *31.1

 Certification of Chief Executive Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 *31.2

 Certification of Chief Financial Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 **32.1

 Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 101.INS

 101.SCH

 101.CAL

 101.DEF

 101.LAB

 101.PRE

 Cover

 *
Filed herewith.

 **
Furnished herewith.

 +
Management contract or compensatory plan or arrangement.

 ITEM
16. Form 10-K Summary

 None.

 SIGNATURES

 Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

 FIELDS REIT, INC.

 By:

 /s/
 Moishe Gubin

 Gubin

 Chairman
 and Chief Executive Officer

 Dated:
 March 19, 2024

 Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

 Name

 Title

 Date

 /s/
 Moishe Gubin

 Chairman
 and Chief Executive Officer

 (Principal
 Executive Officer)

 March

 Gubin

 /s/
 Greg Flamion

 Chief
 Financial Officer (Principal Financial Officer and Principal Accounting Officer)

 March

 Greg
 Flamion

 /s/
 Michael Blisko

 March

 Blisko

 /s/
 Essel Bailey

 March 19, 2024

 Essel
 Bailey

 /s/
 Jack Levine

 March

 Jack
 Levine

 /s/
 Reid Shapiro

 March

 Reid
 Shapiro

 Page

 Report of Independent Registered Public Accounting Firm (PCAOB ID No. 400) with respect to Strawberry Fields REIT, Inc.

 Consolidated Balance Sheets as of December 31, 2023 and 2022

 Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2023 and 2022

 Consolidated Statements of Equity for the years ended December 31, 2023 and 2022

 Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2023

 Notes to Consolidated Financial Statements

 Schedule III: Real Estate and Accumulated Depreciation as of December 31, 2023

 F- 1

 Report
of Independent Registered Public Accounting Firm

 To
the Board of Directors and Members of Strawberry Fields REIT, INC.

 Opinion
on the Consolidated Financial Statements

 We
have audited the accompanying consolidated balance sheets of Strawberry Fields REIT, Inc., (the "Company") as of December
31, 2023 and 2022 and the related consolidated statements of income and comprehensive income, equity and cash flows, for the years then
ended, and the related notes to the consolidated financial statements and financial statement schedule III (collectively referred to
as the "consolidated financial statements"). In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2023 and 2022, and the consolidated
results of its operations and its cash flows for the years then, in conformity with accounting principles generally accepted in the United
States of America.

 Supplemental
Information

statement schedule III ("Schedule III") has been subjected to audit procedures performed in conjunction with the audit of
the Company's consolidated financial statements. Schedule III is the responsibility of the Company's management. Our audit
procedures included determining whether Schedule III reconciles to the consolidated financial statements or the underlying accounting
and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in Schedule
III. In forming our opinion on Schedule III, we evaluated whether Schedule III, including its form and content, is presented in conformity
with the rules and regulations of the Securities and Exchange Commission ("SEC"). In our opinion, Schedule III is fairly
stated, in all material respects, in relation to the consolidated financial statements as a whole.

 Basis
for Opinion

 These
consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion
on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public
Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company
in accordance with the U.S. federal securities laws and the applicable rules and regulations of the SEC and the PCAOB.

 We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part
of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing
an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

 Our
audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles
used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that our audits provide a reasonable basis for our opinion.

 (PCAOB
ID: 400)

 HACKER,
JOHNSON & SMITH PA

 We
have served as the Company's auditor since 2019.

 Tampa,
Florida

 March

 F- 2

BALANCE SHEETS

in $000's, except share data)

 2023

 2022

 2023

 2022

 Assets

 Real
 estate investments, net

 $
 518,314

 $
 438,911

 Cash
 and cash equivalents

 12,173

 20,197

 Restricted
 cash and equivalents

 25,585

 25,507

 Straight-line
 rent receivable, net

 23,334

 23,534

 Right
 of use lease asset

 1,542

 1,833

 Goodwill,
 other intangible assets and lease rights

 8,604

 11,632

 Deferred
 financing expenses

 6,035

 5,791

 Notes
 receivable, net

 17,706

 19,419

 Other

 3,502

 Total Assets

 $
 616,795

 $
 547,000

 Liabilities

 Accounts
 payable and accrued liabilities

 $
 16,907

 $
 13,723

 Bonds,
 net

 100,294

 74,412

 Notes
 payable and other debt

 436,192

 381,003

 Operating
 lease liability

 1,542

 1,833

 Other
 liabilities

 14,587

 10,892

 Non-controlling
 interest redemption liability

 -

 15,753

 Total Liabilities

 $
 569,522

 $
 497,616

 Commitments and Contingencies (Notes 8 and 14)

 Equity

 Common
 stock, $.0001 par
 value, 500,000,000 shares
 authorized, 6,487,856 and
 6,365,856 shares
 issued and outstanding in 2023 and 2022

 -

 -

 Preferred
 stock, $.0001 par
 value, 100,000,000 shares
 authorized, no shares
 issued and outstanding

 -

 -

 Additional
 paid in capital

 $
 5,746

 $
 5,792

 Accumulated
 other comprehensive income

 Retained
 earnings

 1,232

 1,608

 Total Stockholders' Equity

 $
 7,507

 $
 7,786

 Non-controlling interest

 $
 39,766

 $
 41,598

 Total Equity

 $
 47,273

 $
 49,384

 Total Liabilities and Equity

 $
 616,795

 $
 547,000

 See
accompanying notes to consolidated financial statements.

 F- 3

STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

in $000's, except share data)

 2023

 2022

 Year Ended December 31,

 2023

 2022

 Revenues

 Rental revenues

 $
 99,805

 $
 92,543

 Expenses:

 $
 26,207

 25,530

 Amortization

 3,028

 3,028

 Loss on real estate investment impairment

 2,451

 -

 General and administrative expenses

 5,662

 6,012

 Property taxes

 14,459

 13,131

 Facility rent expenses

 Credit for doubtful accounts

 -

 ( 5,636
)

 Total expenses

 $
 52,366

 $
 42,597

 Income from operations

 47,439

 49,946

 Interest expense, net

 $
 ( 24,443
)

 $
 ( 20,507
)

 Amortization of deferred financing costs

 ( 560
)

 ( 504
)

 Mortgage insurance premium

 ( 1,671
)

 ( 1,704
)

 Total interest expense

 $
 ( 26,674
)

 $
 ( 22,715
)

 Other income (loss):

 Foreign currency transaction gain (loss)

 ( 10,932
)

 Other (loss) income

 ( 983
)

 Total other loss

 ( 521
)

 ( 10,812
)

 Net income

 $

 $

 Less:

 Net income attributable to non-controlling interest

 ( 17,748
)

 ( 14,567
)

 Net income attributable to common shareholders

 2,496

 1,852

 Other comprehensive income:

 Gain due to foreign currency translation

 1,624

 14,256

 Reclassification of foreign currency transaction (gains) losses

 ( 462
)

 10,932

 Comprehensive income attributable to non-controlling interest

 ( 1,019
)

 ( 22,347
)

 Comprehensive income

 $
 2,639

 $
 4,693

 Net income attributable to common stockholders

 $
 2,496

 $
 1,852

 Basic and diluted income per common share

 $
.39

 $
.31

 Weighted average number of common stock outstanding

 6,365,196

 6,008,953

 See
accompanying notes to consolidated financial statements.

 F- 4

STATEMENTS OF EQUITY

in $000's, except share data)

 Number of Common Shares

 Additional Paid-in Capital

 Accumulated other comprehensive income (loss)

 Retained Earnings

 Non-controlling interest

 Total

 Balance, December 31, 2021

 5,849,746

 $
 4,327

 $
 ( 2,455
)

 $

 $
 32,785

 $
 35,050

 Issuance of common shares in exchange for OP units

 516,110

 -

 -

 -

 -

 -

 Reallocation of non-controlling interest

 -

 1,465

 -

 -

 ( 1,465
)

 -

 Dividends

 -

 -

 -

 ( 637
)

 -

 ( 637
)

 Non-controlling interest distributions

 -

 -

 -

 -

 ( 10,883
)

 ( 10,883
)

 Net change in foreign currency translation

 -

 -

 2,841

 -

 22,347

 25,188

 Reclassification of non-controlling interest to non-controlling interest redemption liability

 -

 -

 -

 -

 ( 15,753
)

 ( 15,753
)

 Net Income

 -

 -

 -

 1,852

 14,567

 Balance, December 31, 2022

 6,365,856

 $
 5,792

 $

 $
 1,608

 $
 41,598

 $
 49,384

 Balance

 6,365,856

 $
 5,792

 $

 $
 1,608

 $
 41,598

 $
 49,384

 Issuance of common shares in exchange for OP units

 127,953

 -

 -

 -

 -

 -

 Common stock retirement

 ( 5,953
)

 ( 46
)

 -

 -

 ( 46
)

 Dividends

 -

 ( 2,872
)

 -

 ( 2,872
)

 Non-controlling interest distributions

 -

 -

 -

 -

 ( 20,599
)

 ( 20,599
)

 Net change in foreign currency translation

 -

 -

 -

 1,019

 1,162

 Net Income

 -

 -

 -

 2,496

 17,748

 Balance, December 31, 2023

 6,487,856

 $
 5,746

 $

 $
 1,232

 $
 39,766

 $
 47,273

 Balance

 6,487,856

 5,746

 1,232

 39,766

 47,273

 See
accompanying notes to consolidated financial statements.

 F- 5

STATEMENTS OF CASH FLOWS

in $000's)

 Year Ended December 31,

 2023

 2022

 Cash flows from operating activities:

 Net income

 $

 $

 Adjustments to reconcile net income to net cash provided by operating activities:

 Depreciation and amortization

 29,235

 28,558

 Impairment of real estate asset

 2,451

 -

 Amortization of bond issuance costs

 1,160

 Amortization of deferred financing costs

 (Increase) decrease in other assets

 ( 3,326
)

 Amortization of right of use asset

 Foreign currency transaction (gain) loss

 ( 462
)

 10,932

 Foreign currency translation adjustments

 ( 1,395
)

 Credit for doubtful accounts due to recovery of foreclosed real estate

 -

 ( 1,200
)

 Decrease (increase) in straight-line rent receivables

 ( 272
)

 Increase (decrease) increase in accounts payable and accrued liabilities and other liabilities

 6,879

 ( 6,435
)

 Repayment of operating lease liability

 ( 291
)

 ( 231
)

 Net cash provided by operating activities

 $
 54,944

 $
 50,926

 Cash flow from investing activities:

 Purchase of Real estate investments

 $
 ( 108,061
)

 $
 ( 513
)

 Decrease (Increase) in notes receivable

 1,713

 ( 9,588
)

 Net cash used in investing activities

 $
 ( 106,348
)

 $
 ( 10,101
)

 Cash flows from financing activities:

 Proceeds from senior debt, net of discount

 $
 69,208

 $
 105,000

 Deferred financing costs

 ( 804
)

 ( 1,469
)

 Proceeds from issuance of bonds, net of issuance costs

 52,381

 -

 Repayment of bonds

 ( 24,038
)

 ( 106,012
)

 Repayment of senior debt

 ( 14,019
)

 ( 33,248
)

 Repayment of non-controlling interest redemption liability

 ( 15,753
)

 -

 Non-controlling interest distributions

 ( 20,599
)

 ( 10,883
)

 Payment of dividends

 ( 2,872
)

 ( 637
)

 Common stock retirement

 ( 46
)

 -

 Net cash provided by (used in) financing activities

 $
 43,458

 $
 ( 47,249
)

 Decrease in cash and cash equivalent and restricted cash and equivalents

 $
 ( 7,946
)

 $
 ( 6,424
)

 Cash and cash equivalents and restricted cash and equivalents at
 the beginning of the year

 $
 45,704

 $
 52,128

 Cash and cash equivalents and restricted cash and equivalents at the end of the year

 $
 37,758

 $
 45,704

 F- 6

STATEMENTS OF CASH FLOWS

in $000's)

 Year Ended December 31,

 2023

 2022

 Supplemental Disclosure of Cash Flow Information:

 Cash paid during the year for interest

 $
 24,389

 $
 21,629

 Supplemental schedule of noncash activities:

 Accumulated other comprehensive income:

 Foreign currency translation adjustments

 $
 1,162

 $
 25,188

 Increase in real estate investments due to non-cash recovery of foreclosed real estate

 $
 -

 $
 1,200

 Reclassification of non-controlling interest to non-controlling interest redemption liability

 $
 -

 $
 15,753

 See
accompanying notes to consolidated financial statements.

 F- 7

 NOTES

 NOTE
1. Business

 Overview

 The

FIELDS REIT Inc. (the "Company") is a Maryland corporation formed in July 2019. The Company commenced operations on June
8, 2021, following the completion of the formation transactions described below. The Company conducts its business through a traditional
UPREIT structure in which substantially all of its assets are owned by subsidiaries of Strawberry Fields Realty, LP, a Delaware limited
partnership formed in July 2019 (the "Operating Partnership"). The Company is the general partner of the Operating Partnership.

 The
Company completed the formation transactions on June 8, 2021. In connection with the formation transaction, the Company, the Operating
Partnership and Strawberry Fields REIT, LLC (the "Predecessor Company" or "Predecessor") entered into a contribution
agreement, pursuant to which the Predecessor Company contributed all of its assets to the Operating Partnership, and the Operating Partnership
assumed all of its liabilities. In exchange, the Operating Partnership issued limited partnership interests designated as common units
(the "OP units") to the Predecessor Company, which immediately distributed them to its members and beneficial owners. The
Company offered certain of the holders of these OP units the opportunity to exchange their OP units for shares of common stock of the
Company on a one-for-one basis. The Company limited the number of OP units that could be exchanged by some of the holders so that such
holders would not become beneficial owners of more than 9.8% of the outstanding shares of the Company in violation of the ownership limitations
set forth in the Company's charter. As of December 31, 2023 and 2022, the Company is the owner of approximately 12.6 % and 12.0
% of the outstanding OP units, respectively. The formation transactions were accounted for at historical cost.

 As
the sole general partner of the Operating Partnership, the Company has the exclusive power under the partnership agreement to manage
and conduct the business affairs of the Operating Partnership, subject to certain limited approval and voting rights of the limited partners.
The Company may cause the Operating Partnership to issue additional OP units in connection with property acquisitions, compensation or
otherwise. The Company became a publicly traded entity on September 21, 2022.

 As
of December 31, 2023, the Company owned 97 properties and leased one property that it in turn subleased to a tenant that operates the
facility.

 Basis
of Presentation

 The
Company maintains its accounting records on an accrual basis in accordance with generally accepted accounting principles in the United
States of America ("GAAP").

 These
consolidated financial statements are presented in U.S. dollars.

 Variable
Interest Entity

 The
Company consolidates the Operating Partnership, a variable interest entity ("VIE") in which the Company is considered the
primary beneficiary. The primary beneficiary is the entity that has (i) the power to direct the activities that most significantly impact
the entity's economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the
VIE that could be significant to the VIE.

 Non-Controlling

 A
non-controlling interest is defined as the portion of the equity in an entity not attributable, directly or indirectly, to the primary
beneficiary. Non-controlling interests are required to be presented as a separate component of equity on a consolidated balance sheet.
Accordingly, the presentation of net income is modified to present the income attributed to controlling and non-controlling interests.
The non-controlling interest on the Company's consolidated balance sheets represents OP units not held by the Company and represents
approximately 87.4 % and 88.0 % of the outstanding OP Units issued by the Operating Partnership as of December 31, 2023 and 2022, respectively.
The holders of these OP units are entitled to share in cash distributions from the Operating Partnership in proportion to their percentage
ownership of OP units. Net income is allocated to the non-controlling interest based on the weighted-average of OP units outstanding
during the year.

 Fiscal
Year End

 The
Company has adopted a fiscal year end of December 31.

 F- 8

 NOTE
2. Summary of Significant Accounting Policies

 Use
of Estimates

 Management
is required to make estimates and assumptions in the preparation of the consolidated financial statements in conformity with GAAP. These
estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual
results may differ from management's estimates.

 Principles
of Consolidation

 The
accompanying consolidated financial statements include the accounts of the Company, the Operating Partnership
and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated upon consolidation.

 Cash
and Cash Equivalents

 Cash
and cash equivalents consist of cash on hand and short-term investments with original maturities of three months or less when purchased.

 The
Company's cash, cash equivalents and restricted cash and cash equivalents periodically exceed federally insurable limits. The Company
monitors the cash balances in its operating accounts and adjusts the cash balances as appropriate; however, these cash balances could
be impacted if the underlying financial institutions fail or are subject to other adverse conditions in the financial markets. To date,
the Company has experienced no loss or lack of access to the cash in its operating accounts. On December 31, 2023 and 2022, the Company
had $ 22,727,000 and $ 40,652,000, respectively, on deposit in excess of federally insured limits.

 Restricted
Cash and Cash Equivalents

 Restricted
cash primarily consists of amounts held by mortgage lenders to provide for real estate tax expenditures, tenant improvements, capital
expenditures and security deposits, as well as escrow accounts related to principal and interest payments on bonds.

 Real
Estate Depreciation

 Real
estate costs related to the acquisition and improvement of properties are capitalized and depreciated over the expected life of the asset
on a straight-line basis. Repair and maintenance costs are charged to expense as incurred and significant replacements and betterments
are capitalized. Repair and maintenance costs include all costs that do not extend the useful life of the real estate asset. The Company
considers the period of future benefit of an asset to determine its appropriate useful life. Expenditures for tenant improvements are
capitalized and amortized over the shorter of the tenant's lease term or expected useful life. The Company anticipates the estimated
useful lives of its assets by class to be generally as follows:

of Assets Useful Lives

 and improvements

 7 - 45
 years

 Equipment
 and personal property

 2 - 18
 years

 F- 9

 NOTE
2. Summary of Significant Accounting Policies (cont.)

 Real
Estate Valuation

 The
Company makes estimates as part of its allocation of the purchase price of acquisitions to the various components of the acquisition
based upon the fair value of each component. In determining fair value, the Company uses current appraisals or other third-party valuations.
The most significant components of these allocations are typically the allocation of fair value to land and buildings and, for certain
of its acquisitions, in place leases and other intangible assets. In the case of the fair value of buildings and the allocation of value
to land and other intangibles, the estimates of the values of these components will affect the amount of depreciation and amortization
the Company records over the estimated useful life of the property acquired or the remaining lease term. In the case of the value of
in place leases, the Company makes best estimates based on the evaluation of the specific characteristics of each tenant's lease.
Factors considered include estimates of carrying costs during hypothetical expected lease up periods, market conditions and costs to
execute similar leases. These assumptions affect the amount of future revenue that the Company will recognize over the remaining lease
term for the acquired in place leases.

 The
Company evaluates each purchase transaction to determine whether the acquired assets meet the definition of a business. Transaction costs
related to acquisitions that are not deemed to be businesses are included in the cost basis of the acquired assets, while transaction
costs related to acquisitions that are deemed to be businesses are expensed as incurred. All of the Company's acquisitions of investment
properties qualified as asset acquisitions during the years ended December 31, 2023 and 2022.

 Revenue
Recognition

 Rental
income from operating leases is generally recognized on a straight-line basis over the terms of the leases. Substantially all of the
Company's leases contain provisions for specified annual increases over the rents of the prior year and are generally computed
in one of three methods depending on specific provisions of each lease as follows:

 (i)

 a
 specified annual increase over the prior year's rent, generally between 1.0 % and 3.0 %;

 (ii)

 a
 calculation based on the Consumer Price Index; or

 (iii)

 specific
 dollar increases.

 Contingent
revenue is not recognized until all possible contingencies have been eliminated. The Company considers the operating history of the lessee
and the general condition of the industry when evaluating whether all possible contingencies have been eliminated and have historically,
and expect in the future, to not include contingent rents as income until received. The Company follows a policy related to rental income
whereby the Company considers a lease to be non-performing after 60 days of non-payment of past due amounts and does not recognize unpaid
rental income from that lease until the amounts have been received.

 Rental
revenues relating to non-contingent leases that contain specified rental increases over the life of the lease are recognized on the straight-line
basis. Recognizing income on a straight-line basis requires us to calculate the total non-contingent rent containing specified rental
increases over the life of the lease and to recognize the revenue evenly over that life. This method results in rental income in the
early years of a lease being higher than actual cash received, creating a straight-line rent receivable asset included in our accompanying
consolidated balance sheets. At some point during the lease, depending on its terms, the cash rent payments eventually exceed the straight-line
rent which results in the straight-line rent receivable asset decreasing to zero over the remainder of the lease term. The Company assesses
the collectability of straight-line rent in accordance with the applicable accounting standards and reserve policy. If the lessee becomes
delinquent in rent owed under the terms of the lease, the Company may provide a reserve against the recognized straight-line rent receivable
asset for a portion, up to its full value, that the Company estimates may not be recoverable.

 F- 10

 NOTE
2. Summary of Significant Accounting Policies (Cont.)

 Revenue
Recognition (cont.)

 Capitalized
above-market lease values are amortized as a reduction of rental income over the remaining terms of the respective leases. Capitalized
below-market leases are accreted to rental income over the remaining terms of the respective leases and expected below-market renewal
option periods.

 The
Company reports revenues and expenses within our triple-net leased properties for real estate taxes that are escrowed and obligations
of the tenants in accordance with their respective lease with us.

 Gain
from sale of real estate investments was recognized when control of the property is transferred, and it is probable that substantially
all consideration will be collected.

 Allowance
for Doubtful Accounts

 The
Company evaluates the liquidity and creditworthiness of its tenants, operators and borrowers on a monthly and quarterly basis. The Company's
evaluation considers industry and economic conditions, individual and portfolio property performance, credit enhancements, liquidity
and other factors. The Company's tenants, borrowers and operators furnish property, portfolio and guarantor/operator-level financial
statements, among other information, on a monthly or quarterly basis; the Company utilizes this financial information to calculate the
lease or debt service coverages that it uses as a primary credit quality indicator. Lease and debt service coverage information is evaluated
together with other property, portfolio and operator performance information, including revenue, expense, net operating income, occupancy,
rental rate, reimbursement trends, capital expenditures and EBITDA (defined as earnings before interest, tax, depreciation and amortization),
along with other liquidity measures. The Company evaluates, on a monthly basis or immediately upon a significant change in circumstance,
its tenants', operators' and borrowers' ability to service their obligations with the Company.

 The
Company maintains an allowance for doubtful accounts for straight-line rent receivables resulting from tenants' inability to make
contractual rent and tenant recovery payments or lease defaults. For straight-line rent receivables, the Company's assessment is
based on amounts estimated to be recoverable over the lease term.

 Impairment
of Long-Lived Assets and Goodwill

 The
Company assesses the carrying value of real estate assets and related intangibles ("real estate assets") when events or changes
in circumstances indicate that the carrying value may not be recoverable. The Company tests its real estate assets for impairment by
comparing the sum of the expected future undiscounted cash flows to the carrying value of the real estate assets. The expected future
undiscounted cash flows are calculated utilizing the lowest level of identifiable cash flows that are largely independent of the cash
flows of other assets and liabilities. If the carrying value exceeds the expected future undiscounted cash flows, an impairment loss
will be recognized to the extent that the carrying value of the real estate assets is greater than their fair value.

 Goodwill
is tested for impairment at least annually based on certain qualitative factors to determine if it is more likely than not that the fair
value of a reporting unit is less than its' carrying value. Potential impairment indicators include a significant decline in real
estate values, significant restructuring plans, current macroeconomic conditions, state of the equity and capital markets or a significant
decline in the Company's market capitalization. If the Company determines that it is more likely than not that the fair value of
a reporting unit is less than its' carrying value, the Company applies the required two-step quantitative approach. The quantitative
procedures of the two-step approach (i) compare the fair value of a reporting unit with its carrying value, including goodwill, and,
if necessary, (ii) compare the implied fair value of reporting unit goodwill with the carrying value as if it had been acquired in a
business combination at the date of the impairment test. The excess fair value of the reporting unit over the fair value of assets and
liabilities, excluding goodwill, is the implied value of goodwill and is used to determine the impairment amount, if any. The Company
has selected the fourth quarter of each fiscal year to perform its annual impairment test.

 F- 11

 NOTE
2. Summary of Significant Accounting Policies (Cont.)

 Concentrations
of Credit Risk

instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, restricted
cash and cash equivalents, notes receivable and operating leases on owned properties. These financial instruments are subject to the
possibility of loss of carrying value as a result of the failure of other parties to perform according to their contractual obligations
or changes in market prices which may make the instrument less valuable. Cash and cash equivalents, restricted cash and equivalents are
held with various financial institutions. From time to time, these balances exceed the federally insured limits. These balances are maintained
with high quality financial institutions which management believes limits the risk.

 With
respect to notes receivable, the Company obtains various collateral and other protective rights, and continually monitor these rights,
in order to reduce such possibilities of loss. In addition, the Company provides reserves for potential losses based upon management's
periodic review of our portfolio.

 On
December 31, 2023, the Company held four notes receivable with an outstanding balance of $ 17.7
 million. The notes have maturities
ranging from 2024 through 2046, and interest rates ranging from 2 %
to 11.25 %.
One of the notes is collateralized by tenants accounts receivable. All other notes receivable are uncollateralized as of December 31,
2023. As of December 31, 2022 the Company held five notes receivable with an outstanding balance of $ 19.4
 million.

 Market
Concentration Risk

 As
of December 31, 2023 and 2022, the Company owned 97 and 78 properties and leases 1 property, respectively, in 9 states, and 34 facilities
(15 in 2022) or 34.6% of its total properties in Indiana (which include 3,240 skilled nursing and assisted living beds or 26.6% of the
Company's total beds) and 20 facilities (20 in 2022) or 20.4% of its total properties located in Illinois (which include 4,226
skilled nursing beds or 34.6% of the Company's total beds). Since tenant revenue is primarily generated from Medicare and Medicaid,
the operations of the Company are indirectly subject to the administrative directives, rules and regulations of federal and state regulatory
agencies, including, but not limited to, Centers for Medicare and Medicaid Services, and the Department of Health and Aging in all states
in which the Company operates. Such administrative directives, rules and regulations, including budgetary reimbursement funding, are
subject to change by an act of Congress, the passage of laws by the state regulators or an administrative change mandated by one of the
executive branch agencies. Such changes may occur with little notice or inadequate funding to pay for the related costs, including the
additional administrative burden, to comply with a change.

 Debt
and Capital Raising Issuance Costs

 Costs
incurred in connection with the issuance of equity interests are recorded as a reduction of additional paid-in capital. Debt issuance
costs related to debt instruments, excluding line of credit arrangements, are deferred, recorded as a reduction of the related debt liability,
and amortized to interest expense over the remaining term of the related debt liability utilizing the interest method. Deferred financing
costs related to line of credit arrangements are deferred, recorded as an asset and amortized to interest expense over the remaining
term of the related line of credit arrangement utilizing the interest method.

 Penalties
incurred to extinguish debt and any remaining unamortized debt issuance costs, discounts and premiums are recognized as income or expense
in the consolidated statements of income at the time of extinguishment.

 Segment
Reporting

 Accounting
guidance regarding disclosures about segments of an enterprise and related information establishes standards for the manner in which
public business enterprises report information about operating segments. The Company's investment decisions in health care properties,
and resulting investments are managed as a single operating segment for internal reporting and for internal decision-making purposes.
Therefore, the Company has concluded that it operates as a single segment.

 Basic
and Diluted Income Per Common Share

 The
Company calculates basic income per common share by dividing net income attributable to common stockholders by the weighted average number
of common shares outstanding during the year. At December 31, 2023 and 2022, there were 45,373,615 and 46,890,541 OP units, respectively,
outstanding which were potentially dilutive securities. During the years ended December 31, 2023, and 2022 the assumed conversion of
the OP units had no impact on basic income per share.

 F- 12

 NOTE
2. Summary of Significant Accounting Policies (Cont.)

 Beds,
Units, Occupancy and Other Measures

 Beds,
units, occupancy and other non-financial measures used to describe real estate investments included in these notes to the consolidated
financial statements are presented on an unaudited basis and are not subject to audit by the Company's independent auditors in
accordance with the standards of the Public Company Accounting Oversight Board.

 Foreign
Currency Translation and Transactions

 Assets
and liabilities denominated in foreign currencies that are translated into U.S. dollars use exchange rates in effect at the end of the
period, and revenues and expenses denominated in foreign currencies that are translated into U.S. dollars use average rates of exchange
in effect during the related period. Gains or losses resulting from translation are included in accumulated other comprehensive income, a component of equity on the consolidated balance sheets.

 Gains
or losses resulting from foreign currency transactions are translated into U.S. dollars at the rates of exchange prevailing at the dates
of the transactions. The effects of transaction gains or losses, if any, are included in other income (loss), in the consolidated statements
of income.

 Fair
Value Measurement

 The
Company measures and discloses the fair value of nonfinancial and financial assets and liabilities utilizing a hierarchy of valuation
techniques based on whether the inputs to a fair value measurement are considered to be observable or unobservable in a marketplace.
Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market
assumptions. This hierarchy requires the use of observable market data when available. These inputs have created the following fair value
hierarchy:

Level 1—quoted prices for identical instruments in active markets;

Level 2—quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets
that are not active; and model-derived valuations in which significant inputs and significant value drivers are observable in active
markets; and

Level 3—fair value measurements derived from valuation techniques in which one or more significant inputs or significant value
drivers are unobservable.

 The
Company measures fair value using a set of standardized procedures that are outlined herein for all assets and liabilities which are
required to be measured at fair value. When available, the Company utilizes quoted market prices from an independent third-party source
to determine fair value and classifies such items in Level 1. In instances where a market price is available, but the instrument is in
an inactive or over-the-counter market, the Company consistently applies the dealer (market maker) pricing estimate and classifies the
asset or liability in Level 2. If quoted market prices or inputs are not available, fair value measurements are based upon valuation
models that utilize current market or independently sourced market inputs, such as interest rates, option volatilities, credit spreads
and/or market capitalization rates. Items valued using such internally generated valuation techniques are classified according to the
lowest level input that is significant to the fair value measurement. As a result, the asset or liability could be classified in either
Level 2 or Level 3 even though there may be some significant inputs that are readily observable. Internal fair value models and techniques
used by the Company include discounted cash flow valuation models.

 F- 13

 NOTE
2. Summary of Significant Accounting Policies (Cont.)

 Real
Estate Investments – Held for Sale

 At
December 31, 2023 and 2022, the Company had one property included in real estate investments which was held for sale and carried at
the lower of their net book value or fair value on a non-recurring basis on the consolidated balance sheets. The Company's real estate investments held for sale were classified as Level 3 of the fair value
hierarchy.

 Stock-Based
Compensation

 The
Company accounts for share-based payment awards in accordance with ASC Topic 718, Compensation – Stock Compensation ("ASC
718"). ASC 718 requires that the cost resulting from all share-based payment transactions be recognized in the consolidated financial
statements. ASC 718 requires all entities to apply a fair value-based measurement method in accounting for share-based payment transactions.
The Company recognizes share-based payments over the vesting period.

 Recent
Accounting Pronouncements

 In
June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-13,
 Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 is intended to improve financial
reporting by requiring timelier recognition of credit losses on loans and other financial instruments held by financial institutions
and other organizations. The amendments in ASU 2016-13 eliminate the "probable" initial threshold for recognition of credit
losses in current accounting guidance and, instead, reflect an entity's current estimate of all expected credit losses. Previously,
when credit losses were measured under current accounting guidance, an entity generally only considered past events and current conditions
in measuring the incurred loss. The amendments in ASU 2016-13 broaden the information that an entity must consider in developing its
expected credit loss estimate for assets measured either collectively or individually.

 Upon
adoption of ASU 2016-13, the Company is required to reassess its financing receivables, including leases and notes receivable, and expects
that application of ASU 2016-13 may result in the Company recognizing credit losses at an earlier date than would otherwise be recognized
under current accounting guidance. On October 16, 2019, the FASB approved ASU 2019-10 which extends the effective date of ASU 2016-13
to January 1, 2023, for smaller reporting companies. Adoption of ASU 2016-13 on January 1, 2023, was not material to the Company's
consolidated financial position and results of operations.

 F- 14

 NOTE
3. Restricted Cash and Equivalents

 The
following table presents the Company's cash and equivalents and escrow deposits:

 Schedule of Restricted Cash and Equivalents and Escrow Deposits

 2023

 2022

 2023

 2022

 (amounts in $000's)

 Escrow with trustee

 $
 -

 $
 2,287

 MIP escrow accounts

 Other escrow and debt deposits

 Property tax and insurance escrow

 6,842

 5,243

 Interest and expense reserve bonds escrow

 3,924

 2,276

 HUD replacement reserves

 13,288

 14,175

 Total restricted cash and equivalents

 $
 25,585

 $
 25,507

 Escrow
with trustee - The Company transfers funds to the trustee for its Series C Bonds and Series D bonds to cover principal and interest
payments prior to the payment date.

 MIP
escrow accounts - The Company is required to make monthly escrow deposits for mortgage insurance premiums on the HUD guaranteed mortgage
loans.

 Other
escrow and debt deposits – The Company funds various escrow accounts under certain of its loan agreements, primarily to cover
debt service on underlying loans,

tax and insurance escrow - The Company funds escrows for real estate taxes and insurance under certain of its loan agreements.

and expense reserve bonds escrow - The indentures for the Series C Bonds and Series D Bonds require the funding of a six-month interest
reserve as well as an expense reserve. See Note 7 - Notes Payable and Other Debt.

 HUD
replacement reserves - The Company is required to make monthly payments into an escrow for replacement and improvement of the project
assets covered by HUD guaranteed mortgage loans. A portion of the replacement reserves are required to be maintained until the applicable
loan is fully paid.

 NOTE
4. Real Estate Investments, net

 Real
estate investments consist of the following:

 Schedule of Real Estate Investment

 Estimated

 Useful Lives

 Useful Lives

 2023

 2022

 (Years)

 Buildings and improvements

 7 - 45

 $
 576,044

 $
 495,215

 Equipment and personal property

 2 - 18

 97,359

 78,524

 Land

 -

 64,309

 60,010

 Real estate investments, gross

 737,712

 633,749

 Less: accumulated depreciation

 ( 219,398
)

 ( 194,838
)

 Real estate investments, net

 $
 518,314

 $
 438,911

 For
the years ended December 31, 2023 and 2022, total depreciation expense were $ 26.2 million and $ 25.5 million, respectively.

 F- 15

 NOTE
4. Real Estate Investments, net (cont.)

 Acquisition
of Properties

 On
August 25, 2021, the Company acquired five properties located in Tennessee and one in Kentucky (the "Tennessee/Kentucky Properties")
for an aggregate acquisition cost of $ 81.0 million, which was paid through the issuance of 1,545,217 OP units valued at $ 16,997,000,
including 90,909 of OP units paid to the broker valued at $ 1 million and a cash payment of $ 63,990,000. Moishe Gubin, our Chairman and
Chief Executive Officer, agreed to purchase the OP units issued to the sellers either at cost or fair market value (whichever is higher)
12 months after the closing at the option of the sellers. The properties contain skilled nursing facilities of approximately 223,000
square feet and 515 beds. The Company financed a portion of the cash portion of the purchase price from the net proceeds received by
the Company from the sale of Series C Bonds in Israel. The Company leased the five Tennessee facilities to related parties under a new
Tennessee master lease, and the one Kentucky property to an unrelated third party under the existing Landmark master lease. On May 1,
2023, the Operating Partnership paid $ 15.6 million to redeem 1,454,308 OP units granted to the sellers of five properties in Tennessee
and one in Kentucky the Company acquired in 2021. In connection with this payment, the Company contributed $ 0.7 million to the Operating
Partnership and was issued 65,455 OP units.

 On
January 3, 2023, the Company acquired a property located in Kentucky for an aggregate cost of $ 6.0 million, including $ 1 million in finder
fees and $ 0.7 million in leasehold improvements, which was paid in cash. This property contains a skilled nursing facility with 120 licensed
beds and approximately 34,824 square feet. Concurrently with the closing of the acquisition, we added the property to an existing master
lease with an unaffiliated third-party operator. The lease has an initial term of 10 years, with two 5-year extension options. The initial
annualized base rent of the master lease was increased by $ 0.6 million.

 On
August 25, 2023, the Company acquired 24 healthcare facilities (19 properties) located in Indiana (the "Indiana
Facilities") for $ 102.0
million. The Indiana Facilities are comprised of 19 skilled nursing facilities with 1,659 licensed beds and five assisted living
facilities with 193 beds, of which 29 beds are licensed. Annualized straight line rent for the facilities is expected to equal
$ 12.7 million
representing a weighted average lease yield of 12.4 %. Effective March 1, 2023 the company commenced a new master lease for these
facilities. Please refer to the section Note 14 Subsequent Events for additional details of the lease.

 The
Company acquired the Indiana Facilities utilizing the Company's working capital, which included $ 19.2 million in proceeds from
our sale of additional Series D Bonds, together with funds to be borrowed under a new $ 66.0 million credit facility from a commercial
bank. The credit facility has a 5 -year term, at a floating rate of SOFR plus 3.5 % and is interest-only for the initial 12 months. The
Company also made a loan of $ 6.5 million to the sellers, which will be payable within 60 days of the closing.

 The
Indiana Facilities are currently leased under a master lease agreement dated November 1, 2022, between the sellers and a group of tenants
affiliated with two of the Company's directors, Moishe Gubin and Michael Blisko. Under the master lease, the tenants are required
to pay annual rent, on a triple net basis, commencing on November 1, 2022, in the amount of $ 9.5 million, which amount is subject to
annual increases set forth in the master lease. The master lease has an initial term of seven years. The tenants have three options to
extend the lease. The first option is for three years, the two remaining options are for five years each. The tenants have an option
to buy the properties during the sixth or seventh year of the lease for $ 127.0 million. The material terms of the master lease were not
modified as a result of the purchase. The tenants operate the Indiana Facilities as skilled nursing and assisted living facilities.

 On
December 12, 2023 the Company entered into a lease for two skilled nursing facilities with 226 licensed beds near Johnson City, Tennessee.
The lease includes a purchase option which the Company intends to exercise once certain conditions precedent are met. The lease commenced
on January 1, 2024.

 Re-tenant of Real Estate Properties

 On October 30, 2023 the Company entered into a lease agreement to
re-tenant the three skilled nursing facilities located in Texas. The lease is for 10 years with annual escalations of 2.5 %. The lease
commenced on December 1, 2023.

 Dispositions
of Assets

 In
February 2023 one of the SNF's owned by the Company in Southern Illinois was closed. The closure was a result of the tenant request
and mainly for efficiency reasons. This SNF is under a master lease with 2 other facilities and the full amount of the rental payments
under the master lease are continuing to be paid. Additionally, the operator continues to be responsible for ensuring the building is
secure and paying utilities, real estate taxes and insurance bills.

 F- 16

 NOTE
4. Real Estate Investments, net (cont.)

 Other
Properties

 In
December 2022, the Company, through one of its subsidiaries, took title on a property in Massachusetts through a foreclosure. See note
2 above. As of December 31, 2023, the property is carried at estimated fair value of $ 1.2 million and is included in real estate investments
in the accompanying consolidated balance sheets.

 NOTE
5. Intangible Assets and Goodwill

assets consist of the following goodwill, Certificate of Need ("CON") licenses and lease rights:

 Schedule of Intangible Assets and Goodwill

 Goodwill including CON Licenses

 Lease Rights

 Total

 Balances, December 31, 2021

 Gross

 $
 1,323

 $
 54,577

 $
 55,900

 Accumulated amortization

 -

 ( 41,240
)

 ( 41,240
)

 Net carrying amount

 $
 1,323

 $
 13,337

 $
 14,660

 Amortization for the year ended December 31, 2022

 -

 ( 3,028
)

 ( 3,028
)

 Balances, December 31, 2022

 Gross

 $
 1,323

 $
 54,577

 $
 55,900

 Accumulated amortization

 -

 ( 44,268
)

 ( 44,268
)

 Net carrying amount

 $
 1,323

 $
 10,309

 $
 11,632

 Amortization for the year ended December 31, 2023

 $
 -

 ( 3,028
)

 ( 3,028
)

 Balances, December 31, 2023

 Gross

 $
 1,323

 $
 54,577

 $
 55,900

 Accumulated amortization

 -

 ( 47,296
)

 ( 47,296
)

 Net carrying amount

 $
 1,323

 $
 7,281

 $
 8,604

 Estimated
amortization expense for all finite-lived intangible assets for each of the future years ending December 31, is as follows:

of Estimated Amortization Expenses

 Amortization of Lease Rights

 2024

 $
 3,028

 2025

 3,028

 2026

 2027

 2028

 Total

 $
 7,281

 F- 17

 NOTE
6. Leases

 As
of December 31, 2023, the Company had leased 98 properties to tenant/operators in the States of Illinois, Indiana, Michigan, Ohio, Texas,
Kentucky, Tennessee, Oklahoma and Arkansas. As of December 31, 2022 the company leased 79 properties. In both December 31, 2023 and 2022
all of the Company's healthcare facilities were leased. Most of these facilities are leased on a triple-net basis, meaning that
the lessee ( i.e., operator of the facility) is obligated under the lease for all expenses of the property in respect to insurance,
taxes and property maintenance, as well as the lease payments.

 The
following table provides additional information regarding the properties owned/leased for the periods indicated:

 Schedule of Properties Own and Leased Information

 2023

 2022

 Cumulative number of properties

 Cumulative number of operational beds

 12,201

 10,332

 The
following table provides additional information regarding the properties/facilities leased by the Company as of December 31, 2023:

 Schedule of Additional Information on Properties Facilities Leased

 State

 Number of
 Operational
 Beds/Units

 Owned by Company

 Leased by Company

 Total

 4,226

 -

 Indiana

 3,240

 Michigan

 -

 Ohio

 -

 Tennessee

 1,056

 -

 Kentucky

 1,163

 -

 Arkansas

 1,568

 -

 Oklahoma

 -

 Texas

 -

 Total properties

 12,201

 Facility Type

 Skilled Nursing Facilities

 11,865

 Long-Term Acute Care Hospitals (1)

 -

 Assisted Living Facility

 -

 Total facilities

 12,201

 (1)

 Each
 property is comprised of a skilled nursing facility and long-term acute care hospital.

 As
of December 31, 2023, total future minimum rental revenues for the Company's tenants are as follows:

 Schedule of Future Minimum Rental Revenues

 Year

 Amount

 2024

 $
 93,923

 2025

 86,439

 2026

 69,687

 2027

 70,250

 2028

 66,360

 Thereafter

 148,589

 Total

 $
 535,248

 F- 18

 NOTE
6. Leases (cont.)

 The
following table provides summary information regarding the number of operational beds associated with a property leased by the Company
and subleased to third-party operators:

 Schedule of Property Leases to Third Parties

 2023

 2022

 Number of facilities leased and subleased to third-parties

 Number of operational beds

 Right
of use assets and operating lease liabilities are disclosed as separate line items in the consolidated balance sheets and are valued
based on the present value of the future minimum lease payments at lease commencement. As the Company's leases do not provide
an implicit rate, the Company used its incremental borrowing rate based on the information available at the adoption date in determining
the present value of future payments. Lease expense is recognized on a straight-line basis over the lease term. The Company's operating
lease obligation is for one skilled nursing facility. The lease expires on March 1, 2028 and has two five-year renewal options. The lease
is a triple net lease, which requires the Company to pay real and personal property taxes, insurance expenses and all capital improvements.
The Company subleases the building as part of the Indiana master lease. Based on the sublease with the Company's tenant, the tenant
is required to pay real and personal property taxes, insurance expenses and all capital improvements.

 The
components of lease expense and other lease information are as follows (dollars in thousands):

 Schedule of Components of Lease Expense

 Years ended December 31,

 2023

 2022

 Operating lease cost

 $

 $

 As of December 31,

 2023

 2022

 Operating lease right of use asset

 $
 1,542

 $
 1,833

 Operating lease liability

 $
 1,542

 $
 1,833

 Weighted average remaining lease term-operating leases (in years)

 4.25

 5.25

 Weighted average discount rate

 4.1
 %

 4.1
 %

 Future
minimum operating lease payments under non-cancellable leases as of December 31, 2023, reconciled to the Company's operating lease
liability presented on the consolidated balance sheets:

 Schedule of Future Minimum Lease Payments On Non-Cancellable Leases

 (Amounts in $000s)

 2024

 $

 2025

 2026

 2027

 2028

 Total

 $
 1,687

 Less Interest

 ( 145
)

 Total operating lease liability

 $
 1,542

 Other
Properties leased by the Company

 The
Company, through one of its subsidiaries, leases its office spaces from a related party. Rental expense under the leases for the year
ended December 31, 2023 and 2022, was $ 209,000 and $ 203,500, respectively.

 F- 19

 NOTE
7. Notes Payable and Other Debt

 Notes
Payable and Other Debt consist of the following:

 Schedule of Notes Payable and Other Debt

 Weighted Interest Rate at

December 31, 2023

 2023

 2022

 (Amounts in $000s)

 HUD guaranteed bank loans

 3.26
 %

 $
 271,340

 $
 275,778

 Bank loans

 8.84
 %

 164,810

 105,225

 Series A (2022 Only), Series C and Series D Bonds

 7.00
 %

 102,995

 75,788

 Gross Notes Payable and other Debt

 $
 539,145

 $
 456,791

 Debt issuance costs

 ( 2,659
)

 ( 1,376
)

 Net Notes Payable and other Debt

 $
 536,486

 $
 455,415

 Principal
payments on the Notes Payable and Other Debt payable through maturity are as follows (amounts in $000s):

 Schedule of Notes Payable and Other Debt Payables Maturity

 Year Ending December 31

 2024

 $
 18,549

 2025

 19,929

 2026

 103,575

 2027

 97,333

 2028

 70,455

 Thereafter

 229,304

 Total Principal Payments on Notes Payable and Other Debt

 $
 539,145

 Debt
Covenant Compliance

 As
of December 31, 2023 and 2022, the Company was party to approximately 41 and 40 outstanding credit related instruments, respectively.
These instruments included credit facilities, mortgage notes, bonds and other credit obligations. Some of the instruments include financial
covenants. Covenant provisions include, but are not limited to, debt service coverage ratios, and minimum levels of EBITDA (defined as
earnings before interest, tax, and depreciation and amortization) or EBITDAR (defined as earnings before interest, tax, depreciation
and amortization and rental expense). Some covenants are based on annual financial metric measurements, and some are based on quarterly
financial metric measurements. The Company routinely tracks and monitors its compliance with its covenant provisions. As of December
31, 2023, the Company was in compliance with all financial and administrative covenants.

 F- 20

 NOTE

 Senior
Debt—Mortgage Loans Guaranteed by HUD

 As
of December 31, 2023 and 2022, the Company had HUD guaranteed mortgage loans from financial institutions of $ 271 million and $ 276 million,
respectively. These loans were secured by first mortgage liens on the applicable properties, assignments of rent and second liens on
the operator's assets. The Company pays HUD annual mortgage insurance premiums of 0.65 % of the loan balances in addition to the
interest rate. As a result, the overall interest rate paid by the Company with respect to the HUD guaranteed loans as of December 31,
2023 and 2022 was 3.93 % and 3.88 %, respectively (including the mortgage insurance premium).

 Bank
loans/repayment of Series B Bonds

 On
March 21, 2022, the Company closed a mortgage loan facility with a commercial bank pursuant to which the Company borrowed
approximately $ 105
million. The
facility provides for monthly payments of principal based on a 20-year amortization with a balloon payment due in March 2027.
The rate is based on the one-month Secured Overnight Financing Rate ("SOFR") plus a margin of 3.5 %
and a floor of 4 %
(as of December 31, 2023 the rate was 8.84 %).
As of December 31, 2023 and December 31, 2022, total outstanding was $ 98.8
million and $ 102.4 million, respectively. This loan is collateralized by 21 properties owned by the Company. The new loan proceeds were used to repay the Series B
Bonds and prepay certain bank loans not secured by HUD guaranteed mortgages. The Company recognized a foreign currency transaction
loss of approximately $ 10.1
million in connection with the repayment of the Series B Bonds during the year ended December 31, 2022.

 On
August 25, 2023, the Company closed a mortgage loan facility with a commercial bank pursuant to which the Company borrowed approximately
$ 66 million. The facility provides for monthly payments of interest only for the first 12 months and principal based on a 20-year amortization
with a balloon payment due in August 2028. The rate is based on the one-month Secured Overnight Financing Rate ("SOFR") plus
a margin of 3.5 % and a floor of 4 % (as of the December 31, 2023, the rate was 8.84 %). As of December 31, 2023, total outstanding was $ 66
million. This loan is collateralized by 19 properties owned by the Company. The new loan proceeds were used to acquire the Indiana Facilities.

 Both
credit facilities financial covenants consist of (i) a covenant that the ratio of the Company's indebtedness to its EBITDA cannot
exceed 8.0 to 1, (ii) a covenant that the ratio of the Company's net operating income to its debt service before dividend distribution
is at least 1.20 to 1.00 for each fiscal quarter as measured pursuant to the terms of the loan agreement (iii) a covenant that the ratio
of the Company's net operating income to its debt service after dividend distribution is at least 1.05 to 1.00 for each fiscal
quarter as measured pursuant to the terms of the loan agreement, and (iii) a covenant that the Company's GAAP equity is at least
$20,000,000. As of December 31, 2023 the Company is in compliance with the loan covenants.

A Bonds

 In
November 2015, the Company, through a subsidiary, issued Series A Bonds in the face amount of NIS 265.2 million ($ 68 million) and received
the net amount after issuance costs of NIS 251.2 million ($ 64.3 million). Since then the Company extended the series amount twice in
September 2016 and May 2017 and received a combined net amount of $ 30.1 million. The Series A Bonds had an original interest rate of
 6.4 % per annum. The bond was paid off on November 8, 2023.

 F- 21

 NOTE

C Bonds

 In
July 2021, the BVI Company completed an initial offering on the Tel Aviv Stock Exchange ("TASE") of Series C Bonds with a
par value of NIS 208.0 million ($ 64.7 million). These Series C Bonds were issued at par. Offering and issuance costs of approximately
$ 1.7 million were incurred at closing. In February 2023, the BVI Company issued an additional NIS 40.0 million ($ 19.2 million) in Series
C Bonds. At December 31, 2023 and December 31 st,
2022 the total Series C Bond outstanding was $ 60.8 and $ 55.6 million, respectively.

 The
Series C Bonds initially bore interest at a rate of 5.7 % per annum. In July 2021, Standard & Poor's provided an initial rating
for the Series C Bonds of ilA+.

on the Series C Bonds is payable semi-annually in arrears on July 31 and January 31 of each year. The interest rate may increase if certain
financial ratios are not achieved, as discussed below

 Payment
Terms

 The
principal amount of the Series C Bonds is payable in five annual installments due on July 31 of each of the years 2022 through 2026.
The first four principal payments are equal to 6 % of the original principal amount of the Series C Bonds, and the last principal payments
is equal to the outstanding principal amount of the Series C Bonds.

Covenants

 Until
the date of full repayment of the Series C Bonds, the BVI Company must comply with certain financial covenants described below. The application
of the covenants is based on the financial statements of the BVI Company as prepared under the IFRS accounting method. The financial
covenants are as follows:

The stockholders' equity of the BVI Company may not be less than $ 230 million.

The ratio of the consolidated stockholders' equity of the BVI Company to its total consolidated balance sheet may not be less than
 25 %.

The ratio of the adjusted net financial debt to adjusted EBITDA of the BVI Company (for the past four quarters) may not exceed 12.

The ratio of the outstanding amount of the Series C Bonds to the fair market value of the collateral may not exceed 75 %.

 Dividend
Restrictions

 The
indenture for the Series C Bonds limits the amount of dividends that may be paid by the BVI Company to its stockholders. The BVI Company
may not make any distribution unless all of the following conditions are fulfilled (with all amounts calculated under IFRS):

The distribution amount may not exceed 80 % of the net profit after tax that is recognized in the most recent consolidated financial statements
of the BVI Company, less profits or losses arising from a change in accounting methods, net revaluation profits/losses (that have not
yet been realized) arising from a change in the fair value of the assets with respect to the fair value in prior reporting period.

The ratio of the consolidated stockholders' equity of the BVI Company to its total consolidated balance sheet may not be less than
 30 %.

 F- 22

 NOTE

C Bonds (Cont.)

 Dividend
Restrictions (Cont.)

The distributable profits for which no distribution was performed in a specific year will be added to the following quarters.

The BVI Company's equity at the end of the last quarter, before the distribution of dividends, less the dividends distributed,
may not be less than $ 250 million.

The BVI Company meets the financial conditions described above, and the Company is not in violation of all and/or any of its material
undertakings to the holders of the Series C Bonds.

 Increase
in Interest Rate

 In
the event that:

 (i)
the stockholders' equity of BVI Company (excluding minority interests) is less than $ 250 million;

 (ii)
the ratio of the adjusted net financial debt to adjusted EBITDA (for the latest four quarters) exceeds 11;

 (iii)
the ratio of the consolidated equity of the BVI Company to total consolidated assets of the BVI Company is below 27 %; or

 (iv)
the ratio of outstanding amount of the Series C Bonds to the fair market value of the collateral for the Series B Bonds exceeds 75 %,

 then,
in each case, the interest on the Series C Bonds will increase by an additional 0.5 % annually, but only once with respect to each failure
to meet these requirements. Compliance with these financial covenants is measured quarterly.

 Additionally,
if a decline in the rating of the Series C Bonds should take place, then for each single ratings decrease, the interest will be increased
by 0.25 % per year, up to a maximum increment of 1.25 % annually.

 In
any case, the total increase in the interest rate as a result of the above adjustments will not exceed 1.5 % per year. The increases in
the interest rate will also be reversed if the BVI Company regains compliance.

 Security

 The
Series C Bonds are secured by first mortgage liens on eight properties. In addition, the Series C Bonds are also secured by interest
and expenses reserves. The BVI Company has agreed not to pledge its assets pursuant to a general lien without obtaining the prior consent
of the holders of the Series C Bonds, provided that the BVI Company is entitled to register specific liens on its properties and also
to provide guarantees and its subsidiaries are entitled to register general and specific liens on their assets.

 Under
the terms of the indenture for the Series C Bonds, the BVI Company can take out properties from the collateral (in case of HUD refinancing)
or to add properties and increase the Series C Bonds as long as the ratio of outstanding amount of the Series C Bonds to fair market
value of the collateral is not more than 65%. In addition, starting from July 1, 2023, if the fair market value of the collateral is
below 55%, the BVI Company can request to release collateral so the fair market value will increase to 55%.

 F- 23

 NOTE

C Bonds (cont.)

 Additional
Bonds

 The
BVI Company can issue additional Series C Bonds at any time not to exceed a maximum of NIS 630 million (or $ 192 million).

 Redemption
Provisions

 The
BVI Company may, at its discretion, call the Series C Bonds for early repayment. In the event of the redemption of all of the Series
C Bonds, the BVI Company would be required to pay the highest of the following amounts:

 the
 market value of the balance of the Series C Bonds in circulation which will be determined based on the average closing price of the
 Series B Bonds for thirty (30) trading days before the date on which the board of directors resolves to undertake the early redemption;

 the
 par value of the Series C Bonds available for early redemption in circulation (i.e., the principal balance of the Series C Bonds
 plus accrued interest until the date of the actual early redemption); or

 the
 balance of the payments under the Series C Bonds (consisting of future payments of principal and interest), when discounted to their
 present value based on the annual yield of the Israeli government bonds plus an "additional rate." The additional rate
 will be 3.0 % per annum for early repayment as of December 31, 2023.

 Change
of Control

 The
holders of a majority of the Series C Bonds may accelerate the outstanding balance of the Bonds if the control of the BVI Company is
transferred, directly or indirectly, unless the transfer of control is approved by the holders of a majority of the Series C Bonds.

 For
the purpose of this provision, a transfer of control means a change of control of the BVI Company such that the BVI Company has a controlling
stockholder that is not any of the "controlling stockholders" and/or is in the hands of any of their immediate family members
(including through trusts that the controlling stockholders and/or any of their immediate family members are the beneficiaries under
and/or are their managers). In this regard, "control" is defined in the Israeli Companies Law.

 For
purposes of the Series C Bonds, the "controlling stockholders" of the BVI Company are deemed to be Moishe Gubin and Michael
Blisko.

 F- 24

 NOTE

D Bonds

 In
June 2023, the BVI Company completed an initial offering on the Tel Aviv Stock Exchange ("TASE") of Series D Bonds with
a par value of NIS 82.9 million
($ 22.9 million).
These Series D Bonds were issued at par. Offering and issuance costs of approximately $ 0.6 million
were incurred at closing. In July 2023, the BVI Company issued an additional NIS 70 million
($ 19.2 million)
in Series D Bonds. Total outstanding Series D bonds as of December 31, 2023 was NIS 152.9
million ($ 42.2
million). In February 8, 2024 the BVI Company issued an additional NIS 100
million ($ 27.2)
in series D bond.

 The
Series D Bonds initially bore interest at a rate of 9.1 % per annum. In June 2023, Standard & Poor's provided an initial rating
for the Series D Bonds of ilA.

on the Series D Bonds is payable semi-annually in arrears on March 31 and September 30 of each year. The interest rate may increase if
certain financial ratios are not achieved, as discussed below.

 Payment
Terms

 The
principal amount of the Series D Bonds is payable in three annual installments due on September 30 of each of the years 2024 through
2026. The first two principal payments are equal to 6 % of the original principal amount of the Series D Bonds, and the last principal
payments is equal to the outstanding principal amount of the Series D Bonds.

Covenants

 Until
the date of full repayment of the Series D Bonds, the BVI Company must comply with certain financial covenants described below. The application
of the covenants is based on the financial statements of the BVI Company as prepared under the IFRS accounting method. The financial
covenants are as follows:

The stockholders' equity of the BVI Company may not be less than $ 230 million.

The ratio of the Condensed Consolidated stockholders' equity of the BVI Company to its total Condensed Consolidated balance sheet
may not be less than 25 %.

The ratio of the adjusted net financial debt to adjusted EBITDA of the BVI Company (for the past four quarters) may not exceed 12.

 Dividend
Restrictions

 The
indenture for the Series D Bonds limits the amount of dividends that may be paid by the BVI Company to its stockholders. The BVI Company
may not make any distribution unless all of the following conditions are fulfilled (with all amounts calculated under IFRS):

The distribution amount may not exceed 80 % of the net profit after tax that is recognized in the most recent Condensed Consolidated financial
statements of the BVI Company, less profits or losses arising from a change in accounting methods, net of revaluation profits/losses
(that have not yet been realized) arising from a change in the fair value of the assets with respect to the fair value in the prior reporting
period.

The ratio of the consolidated stockholders' equity of the BVI Company to its total consolidated balance sheet may not be less than
 30 %.

The distributable profits for which no distribution was performed in a specific year will be added to the following quarters.

The BVI Company's equity at the end of the last quarter, before the distribution of dividends, less the dividends distributed,
may not be less than $ 250 million.

The BVI Company meets the financial conditions described above, and the BVI Company is not in violation of all and/or any of its material
undertakings to the holders of the Series D Bonds as of December 31, 2023.

 F- 25

 NOTE

D Bonds (Cont.)

 Increase
in Interest Rate

 In
the event that:

 (i)
the stockholders' equity of the BVI Company (excluding minority interests) is less than $ 250 million;

 (ii)
the ratio of the adjusted net financial debt to adjusted EBITDA (for the latest four quarters) exceeds 11;

 (iii)
the ratio of the consolidated equity of the BVI Company to total consolidated assets of the BVI Company is below 27 %; or

 then,
in each case, the interest on the Series D Bonds will increase by an additional 0.5 % annually, but only once with respect to each failure
to meet these requirements. Compliance with these financial covenants is measured quarterly.

 Additionally,
if a decline in the rating of the Series D Bonds should take place, then for each single ratings decrease, the interest will be increased
by 0.25 % per year, up to a maximum increment of 1.25 % annually.

 In
any case, the total increase in the interest rate as a result of the above adjustments will not exceed 1.5 % per year. The increases in
the interest rate will also be reversed if the BVI Company regains compliance.

 Security

 The
BVI Company has committed not to pledge its assets under general liens without obtaining the consent in advance of the Bond holders.
Nevertheless, the BVI Company is entitled to register specific liens on its properties and also to provide guarantees; and its subsidiaries
are entitled to register liens, including general and specific, on their assets.

 Additional
Bonds

 The
BVI Company can issue additional Series D Bonds at any time not to exceed a maximum outstanding of NIS 450 million (or $ 124 million).

 Redemption
Provisions

 The
BVI Company may, at its discretion, call the Series D Bonds for early repayment. In the event of the redemption of all of the Series
D Bonds, the BVI Company would be required to pay the highest of the following amounts:

 the
 market value of the balance of the Series D Bonds in circulation which will be determined based on the average closing price of the
 Series D Bonds for thirty (30) trading days before the date on which the board of directors resolves to undertake the early redemption;

 the
 par value of the Series D Bonds available for early redemption in circulation (i.e., the principal balance of the Series D Bonds
 plus accrued interest until the date of the actual early redemption); or

 the
 balance of the payments under the Series D Bonds (consisting of future payments of principal and interest), when discounted to their
 present value based on the annual yield of the Israeli government bonds plus an "additional rate." The additional rate
 will be 1.0 % per annum for early repayment performed by September 30, 2024, and 3.0 % thereafter.

 Change
of Control

 The
holders of a majority of the Series D Bonds may accelerate the outstanding balance of the Bonds if the control of the BVI Company is
transferred, directly or indirectly, unless the transfer of control is approved by the holders of a majority of the Series D Bonds.

 For
purposes of the Series D Bonds, the "controlling stockholders" of the BVI Company are deemed to be Moishe Gubin and Michael
Blisko.

 For
the purpose of this provision, a transfer of control means a change of control of the BVI Company such that the BVI Company has a controlling
stockholder that is not any of the "controlling stockholders" and/or is in the hands of any of their immediate family members
(including through trusts that the controlling stockholders and/or any of their immediate family members are the beneficiaries under
and/or are their managers). In this regard, "control" is defined in the Israeli Companies Law.

 F- 26

 NOTE
8. Commitments and Contingencies

 Commitments

 The
Company guarantees from time-to-time obligations of its wholly-owned subsidiaries.

 Contingencies

 The
Company's operating results and financial condition are dependent on the ability of its tenants to meet their lease obligations
to us.

 We
are not currently a party to any material legal proceedings, that are not covered by insurance and expected to be resolved within policy
limits, other than the following:

 In
March 2020, Joseph Schwartz, Rosie Schwartz and certain companies owned by them filed a complaint in the U.S. District Court for the
Northern District of Illinois against Moishe Gubin, Michael Blisko, the Predecessor Company and 21 of its subsidiaries, as well as the
operators of 17 of the facilities operated at our properties. The complaint was related to the Predecessor Company's acquisition
of 16 properties located in Arkansas and Kentucky that were completed between May 2018 and April 2019 and the attempt to purchase an
additional five properties located in Massachusetts. The complaint was dismissed by the Court in 2020 on jurisdictional grounds. The
plaintiffs did not file an appeal with respect to this action, and the time for an appeal has expired.

 In
August 2020, Joseph Schwartz, Rosie Schwartz and several companies controlled by them filed a second complaint in the Circuit Court in
Pulaski County, Arkansas. The second complaint had nearly identical claims as the federal case, but was limited to matters related to
the Predecessor Company's acquisition of properties located in Arkansas. The sellers, which were affiliates of Skyline Health Care,
had encountered financial difficulties and requested the Predecessor Company to acquire these properties. The defendants have filed an
answer denying the plaintiffs' claims and asserting counterclaims based on breach of contract. This case has been dismissed without
prejudice.

 In
January 2021, Joseph Schwartz, Rosie Schwartz and certain companies owned by them filed a third complaint in Illinois state court in
Cook County, Illinois, which has nearly identical claims to the initial federal case, but was limited to claims related to the Kentucky
and Massachusetts properties. The complaint has not been properly served on any of the defendants, and, accordingly, the defendants did
not responded to the complaint. Instead, the defendants filed a motion to quash service of process. On January 11, 2023, the Cook County
Circuit Court entered an order granting such motion, quashing service of process on all defendants. In March 2023, the plaintiffs filed
a new complaint and again attempted to serve it on the defendants. It is the defendants' position that service was (once again,
potentially) defective and sought a dismissal of the matter for want of prosecution by Joseph Schwartz, Rosie Schwartz and certain companies
owned by them. The dismissal was granted, but has been appealed to the Illinois Appellate Court, with no substantive movement on the
matter to date.

 In
each of these complaints, the plaintiffs asserted claims for fraud, breach of contract and rescission arising out of the defendants alleged
failure to perform certain post-closing obligations under the purchase contracts. We have potential direct exposure for these claims
because the subsidiaries of the Predecessor Company that were named as defendants are now subsidiaries of the Operating Partnership.
Additionally, the Operating Partnership is potentially liable for the claims made against Moishe Gubin, Michael Blisko and the Predecessor
Company pursuant to the provisions of the contribution agreement, under which the Operating Partnership assumed all of the liabilities
of the Predecessor Company and agreed to indemnify the Predecessor Company and its affiliates for such liabilities. We and the named
defendants believe that the claims set forth in the complaints are without merit. The named defendants intend to vigorously defend the
litigation and to assert counterclaims against the plaintiffs based on their failure to fulfill their obligations under the purchase
contracts, interim management agreement, and operations transfer agreements. We believe this matter will be resolved without a material
adverse effect to the Company.

 As
noted above, the March 2020 and January 2021 complaints also related to the Predecessor Company's planned acquisition of five properties
located in Massachusetts. A subsidiary of the Predecessor Company purchased loans related to these properties in 2018 for a price of
$ 7.74 million with the expectation that the subsidiaries would acquire title to the properties and the loans would be retired. The subsidiary
subsequently advanced $ 3.1 million under the loans to satisfy other liabilities related to the properties. The planned acquisition/settlement
with the sellers/owners and/borrowers was not consummated because the underlying tenants of the properties surrendered their licenses
to operate healthcare facilities on these properties.

 The
Predecessor Company intends to institute legal proceedings to collect the outstanding amount of these loans and to assert related claims
against the sellers and their principals for the unpaid principal balances as well as protective advances and collection costs. In connection
with enforcing their rights, in July 2022, the Company foreclosed, and (as lender) sold four of the five properties at auction for the
total amount of $ 4.4 million. In December 2022, the Company took title on the fifth property with an estimated fair value of $ 1.2 million.

 F- 27

 Note
9. Equity Incentive Plan

 The
Company has adopted the 2021 Equity Incentive Plan (the "Plan"). The Plan permits the grant of both options qualifying under
Section 422 of the Internal Revenue Code ("incentive stock options") and options not so qualifying, and the grant of stock
appreciation rights, stock awards, incentive awards, performance units, and other equity-based awards. A total of 250,000 shares have
been authorized to be granted under the Plan.

 As
of December 31, 2023, and 2022, 225,100 shares were available for grant. No shares were issued during the years ended December
31, 2023 and 2022.

 NOTE
10. Stockholders' Equity and Distributions

 The
Company elected and qualified to be treated as a REIT commencing with the taxable year ending December 31, 2022. U.S. federal income
tax law requires that a REIT distribute annually at least 90% of its net taxable income, excluding net capital gains, and that it pays
tax at regular corporate rates to the extent that it annually distributes less than 100% of its net taxable income, including net capital
gains. In addition, a REIT is required to pay a 4% nondeductible excise tax on the amount, if any, by which the distributions that it
makes in a calendar year are less than the sum of 85% of its ordinary income, 95% of its capital gain net income and 100% of its undistributed
income from prior years.

 On November 9, 2023 the Board of Directors authorized
the repurchase of up to $ 5 million
of the Company's common stock. As of December 31 st, 2023 the Company purchased 5,953
 shares of common stock at an average price per share of $ 7.84
 and an aggregate repurchase priced of $ 46,000.

 As
of December 31, 2023, there were a total of 6,487,856
shares of common stock issued and outstanding. The outstanding shares were held by a total of
approximately 812 stockholders of record, including certain affiliates of the Company who held 938,722
of these shares.

 At
December 31, 2023 there were 45,373,615 OP units outstanding. Under the terms of the Operating Partnership agreement, such holders have
the right to request the redemption of their OP units, in cash. If a holder requests redemption, the Company will have the option of
issuing shares of common stock to the requesting holder instead of cash. In addition, OP unit holders are required to obtain Company
approval prior to the sale or transfer of any or all of such OP unit holders' interest.

 In
addition, the Company has reserved a total of 45,373,615
shares of common stock that may be issued, at the Company's option, upon redemption of the OP units outstanding as of December
31, 2023.

 F- 28

 NOTE
11. Related Party Transactions and Economic Dependence

 The
following entities and individuals are considered to be Related Parties:

 Gubin

 Chairman
 of the Board

 Blisko

 Nahman
 Eingal

 Former
 Chief Financial Officer

 Operating
 entities

 See
 list below

 Lease
Agreements with Related Parties

 As
of December 31, 2023 and 2022, each of the Company's facilities were leased and operated by separate tenants. Each tenant is an
entity that leases the facility from one of the Company's subsidiaries and operates the facility as a healthcare facility. The
Company had 64 tenants out of 107 who were related parties as of December 31, 2023 and 41 tenants out of 79 who were related parties
as of December 31, 2022. Most of the lease agreements are triple net leases.

 On
April 4, 2022, an affiliated tenant in Illinois notified the Company of its intent to default with respect to two master lease agreements.
Each lease included three nursing home facilities with a combined rent of $ 225,000 per month, or $ 2.7 million annually. Default occurred
on June 30, 2022, and the Company recognized a loss of $ 1,075,000 due to the write-offs of straight-line rent receivables during the
year ended December 31, 2022. On July 1, 2022, the Company entered into new lease agreements with an unaffiliated third-party operator
to lease these properties. The new leases have terms of 10 years each and provide for a combined average base rent of $ 180,000 per month,
or $ 2.3 million per year, on average, over the life of the leases. In February 2023 one facility under this master lease was closed.
The closure was a result of the tenant request and mainly for efficiency reasons. This facility is under a master lease with 5 other
facilities and the rent payment is continuing with no interruption and at the same amount.

 The
following table sets forth details of the lease agreements in force between the Company and its subsidiaries and lessees that are related
parties:

 Schedule of Related Party Transactions

 in

 State

 Lessor/

 Gubin/Gubin
 LP

 Blisko/Blisko
 LP

 Average

 annual rent
 over life of
 lease

 Annual

 Escalation

 % of

 total rent

 Lease
 maturity

 Master Lease Indiana

 IN

 1020 West Vine Street Realty, LLC

 The Waters of Princeton II, LLC

 49.49
 %

 50.51
 %

 $
 1,045,506

 3.00
 %

 1.07
 %

 IN

 12803 Lenover Street Realty LLC

 The Waters of Dillsboro – Ross Manor II LLC

 49.49
 %

 50.51
 %

 1,353,655

 3.00
 %

 1.39
 %

 IN

 1350 North Todd Drive Realty, LLC

 The Waters of Scottsburg II LLC

 49.49
 %

 50.51
 %

 1,089,527

 3.00
 %

 1.12
 %

 IN

 1600 East Liberty Street Realty LLC

 The Waters of Covington II LLC

 49.49
 %

 50.51
 %

 1,309,634

 3.00
 %

 1.35
 %

 IN

 1601 Hospital Drive Realty LLC

 The Waters of Greencastle II LLC

 49.49
 %

 50.51
 %

 1,100,532

 3.00
 %

 1.13
 %

 IN

 1712 Leland Drive Realty, LLC

 The Waters of Huntingburg II LLC

 49.49
 %

 50.51
 %

 1,045,506

 3.00
 %

 1.07
 %

 IN

 2055 Heritage Drive Realty LLC

 The Waters of Martinsville II LLC

 49.49
 %

 50.51
 %

 1,133,548

 3.00
 %

 1.16
 %

 IN

 3895 South Keystone Avenue Realty LLC

 The Waters of Indianapolis II LLC

 49.49
 %

 50.51
 %

 891,431

 3.00
 %

 0.92
 %

 IN

 405 Rio Vista Lane Realty LLC

 The Waters of Rising Sun II LLC

 49.49
 %

 50.51
 %

 638,309

 3.00
 %

 0.66
 %

 IN

 950 Cross Avenue Realty LLC

 The Waters of Clifty Falls II LLC

 49.49
 %

 50.51
 %

 1,518,735

 3.00
 %

 1.56
 %

 IN

 958 East Highway 46 Realty LLC

 The Waters of Batesville II LLC

 49.49
 %

 50.51
 %

 946,458

 3.00
 %

 0.97
 %

 IN

 2400 Chateau Drive Realty, LLC

 The Waters of Muncie II LLC

 49.49
 %

 50.51
 %

 792,383

 3.00
 %

 0.81
 %

 IN

 The Big H2O LLC

 The Waters of New Castle II LLC

 49.49
 %

 50.51
 %

 726,351

 3.00
 %

 0.75
 %

 F- 29

 NOTES

 NOTE

 Lease

 in

 State

 Lessor /

 Gubin/Gubin
 LP

 Blisko/Blisko
 LP

 Average

 annual rent
 over life of
 lease

 Annual

 Escalation

 % of

 total rent

 Lease
 maturity

 Master Lease Tennessee

 TN

 115 Woodlawn Drive, LLC

 Lakebridge, a Waters Community, LLC

 50.00
 %

 50.00
 %

 1,514,820

 3.00
 %

 1.55
 %

 TN

 146 Buck Creek Road, LLC

 The Waters of Roan Highlands, LLC

 50.00
 %

 50.00
 %

 1,111,794

 3.00
 %

 1.14
 %

 TN

 5 th Avenue East, LLC

 The Waters of Springfield, LLC

 50.00
 %

 50.00
 %

 917,230

 3.00
 %

 0.94
 %

 TN

 2501 River Road, LLC

 The Waters of Cheatham, LLC

 50.00
 %

 50.00
 %

 1,111,794

 3.00
 %

 1.14
 %

 TN

 202 Enon Springs Road East, LLC

 The Waters of Smyrna, LLC

 50.00
 %

 50.00
 %

 1,264,666

 3.00
 %

 1.30
 %

 TN

 140 Technology Lane, LLC

 The Waters of Johnson City, LLC

 50.00
 %

 50.00
 %

 1,167,384

 3.00
 %

 1.20
 %

 TN

 835 Union Street, LLC

 The Waters of Shelbyville, LLC

 50.00
 %

 50.00
 %

 1,334,153

 3.00
 %

 1.37
 %

 Master Lease Tennessee 2

 TN

 505 North Roan, LLC

 Agape Rehabilitation & Nursing Center, A Water's
 Community LLC

 50.00
 %

 50.00
 %

 1,628,910

 3.00
 %

 1.67
 %

 TN

 14510 Highway 79, LLC

 Waters of McKenzie, A Rehabilitation & Nursing Center,
 LLC

 50.00
 %

 50.00
 %

 1,279,858

 3.00
 %

 1.31
 %

 TN

 6500 Kirby Gate Boulevard, LLC

 Waters of Memphis, A Rehabilitation & Nursing Center,
 LLC

 50.00
 %

 50.00
 %

 1,745,261

 3.00
 %

 1.79
 %

 TN

 978 Highway 11 South, LLC

 Waters of Sweetwater, A Rehabilitation & Nursing Center,
 LLC

 50.00
 %

 50.00
 %

 1,745,261

 3.00
 %

 1.79
 %

 TN

 2830 Highway 394, LLC

 Waters of Bristol, A Rehabilitation & Nursing Center,
 LLC

 50.00
 %

 50.00
 %

 2,327,014

 3.00
 %

 2.38
 %

 F- 30

 NOTES

 NOTE

 Lease

 in

 State

 Lessor/

 Gubin/Gubin
 LP

 Blisko/Blisko
 LP

 Average

 annual rent
 over life of
 lease

 Annual

 Escalation

 %
 of
 total rent

 Lease

 maturity

 Master Lease Indiana 2

 IN

 8400 Clearvista Place LLC

 The Waters of Castleton SNF,
 LLC

 50.00
 %

 50.00
 %

 804,694

 0.83
 %

 2029

 IN

 524 Anderson Road LLC

 The Waters of Chesterfield SNF, LLC

 50.00
 %

 50.00
 %

 423,523

 0.43
 %

 2029

 IN

 640 West Ellsworth Street LLC

 The Waters of Columbia City SNF, LLC

 50.00
 %

 50.00
 %

 592,933

 0.61
 %

 2029

 IN

 11563 West 300 South LLC

 The Waters of Dunkirk SNF, LLC

 50.00
 %

 50.00
 %

 324,701

 0.33
 %

 2029

 IN

 5544 East State Boulevard LLC

 The Waters of Fort Wayne SNF, LLC

 50.00
 %

 50.00
 %

 543,522

 0.56
 %

 2029

 IN

 548 South 100 West LLC

 The Waters of Hartford City SNF, LLC

 50.00
 %

 50.00
 %

 458,817

 0.47
 %

 2029

 IN

 2901 West 37th Avenue LLC

 The Waters of Hobart SNF, LLC

 50.00
 %

 50.00
 %

 776,459

 0.80
 %

 2029

 IN

 1500 Grant Street LLC

 The Waters of Huntington SNF, LLC

 50.00
 %

 50.00
 %

 599,991

 0.62
 %

 2029

 IN

 787 North Detroit Street LLC

 The Waters of LaGrange SNF, LLC

 50.00
 %

 50.00
 %

 705,872

 0.72
 %

 2029

 IN

 981 Beechwood Avenue LLC

 The Waters of Middletown SNF, LLC

 50.00
 %

 50.00
 %

 423,523

 0.43
 %

 2029

 IN

 317 Blair Pike LLC

 The Waters of Peru SNF, LLC

 50.00
 %

 50.00
 %

 917,634

 0.94
 %

 2029

 IN

 815 West Washington Street LLC

 The Waters of Rockport SNF

 50.00
 %

 50.00
 %

 423,523

 0.43
 %

 2029

 IN

 612 East 11th Street LLC

 The Waters of Rushville SNF

 50.00
 %

 50.00
 %

 691,755

 0.71
 %

 2029

 F- 31

 NOTES

 NOTE

 Lease

 in

 State

 Lessor/ Company Subsidiary

 Tenant/ Operator

 Moishe Gubin/Gubin
 Enterprises LP

 Michael Blisko/Blisko
 Enterprises LP

 Average annual
 rent over life of lease

 Annual Escalation

 % of total
 rent

 Lease maturity

 IN

 505 West Wolfe Street LLC

 The Waters of Sullivan SNF

 50.00
 %

 50.00
 %

 656,461

 0.67
 %

 2029

 IN

 500 East Pickwick Drive LLC

 The Waters of Syracuse SNF

 50.00
 %

 50.00
 %

 465,876

 0.48
 %

 2029

 IN

 300 Fairgrounds Road LLC

 The Waters of Tipton SNF

 50.00
 %

 50.00
 %

 1,058,808

 1.09
 %

 2029

 IN

 1900 Alber Street LLC

 The Waters of Wabash SNF East

 50.00
 %

 50.00
 %

 592,933

 0.61
 %

 2029

 IN

 1720 Alber Street LLC

 The Waters of Wabash SNF West

 50.00
 %

 50.00
 %

 310,584

 0.32
 %

 2029

 IN

 300 North Washington Street LLC

 The Waters of Wakarusa SNF

 50.00

 50.00
 %

 938,810

 0.96
 %

 2029

 IN

 8400 Clearvista Place LLC

 The Waters of Castleton ALF, LLC

 50.00

 50.00
 %

 381,171

 0.39
 %

 2029

 IN

 787 North Detroit Street LLC

 The Waters of LaGrange ALF, LLC

 50.00

 50.00
 %

 119,998

 0.12
 %

 2029

 IN

 612 East 11th Street LLC

 The Waters of Rushville ALF, LLC

 50.00

 50.00
 %

 204,703

 0.21
 %

 2029

 IN

 505 West Wolfe Street LLC

 The Waters of Sullivan ALF, LLC

 50.00

 50.00
 %

 225,879

 0.23
 %

 2029

 IN

 300 North Washington Street LLC

 The Waters of Wakarusa ALF, LLC

 50.00

 50.00
 %

 430,582

 0.44
 %

 2029

 F- 32

 NOTES

 NOTE

 Lease

 in

 State

 Lessor/

 Gubin/Gubin
 LP

 Blisko/Blisko
 LP

 Average

 Annual rent
 over life of
 lease

 Annual

 Escalation

 % of

 total
 rent

 Lease
 maturity

 IL

 516 West Frech Street, LLC

 Parker Rehab & Nursing Center, LLC

 50.00
 %

 50.00
 %

 498,351

 Varies
 between $12,000 and $24,000 annually

 0.51
 %

 3/31/2031

 None

 IN

 1316 North Tibbs Avenue Realty, LLC

 Westpark A Waters Community, LLC

 50.00
 %

 50.00
 %

 549,885

 3.00
 %

 0.56
 %

 6/1/2024

 IL

 Ambassador Nursing Realty, LLC

 Ambassador Nursing and Rehabilitation Center II, LLC

 40.00
 %

 40.00
 %

 1,005,313

 3.00
 %

 1.03
 %

 2/28/2026

 IL

 Momence Meadows Realty, LLC

 Momence Meadows Nursing and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 1,038,000

 None

 1.07
 %

 12/30/2025

 None

 IL

 Forest View Nursing Realty, LLC

 Forest View Rehabilitation and Nursing Center, LLC

 50.00
 %

 50.00
 %

 1,215,483

 3.00
 %

 1.25
 %

 12/1/2024

 IL

 Lincoln Park Holdings, LLC

 Lakeview Rehabilitation and Nursing Center, LLC

 40.00
 %

 40.00
 %

 1,260,000

 None

 1.29
 %

 5/31/2031

 None

 IL

 Continental Nursing Realty, LLC

 Continental Nursing and Rehabilitation Center, LLC

 40.00
 %

 40.00
 %

 1,575,348

 None

 1.62
 %

 3/1/2031

 None

 IL

 Westshire Nursing Realty, LLC

 City View Multicare Center, LLC

 50.00
 %

 50.00
 %

 1,788,365

 3.00
 %

 1.84
 %

 9/1/2025

 IL

 Belhaven Realty, LLC

 Belhaven Nursing and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 2,134,570

 3.00
 %

 2.19
 %

 2/28/2026

 IL

 West Suburban Nursing Realty, LLC

 West Suburban Nursing and Rehabilitation Center, LLC

 40.00
 %

 40.00
 %

 1,961,604

 None

 2.01
 %

 11/1/2027

 None

 IN

 1585 Perry Worth Road, LLC

 The Waters of Lebanon, LLC

 50.00
 %

 50.00
 %

 116,678

 3.00
 %

 0.12
 %

 6/1/2027

 IL

 Niles Nursing Realty LLC

 Niles Nursing & Rehabilitation Center LLC

 50.00
 %

 50.00
 %

 2,409,998

 3.00
 %

 2.48
 %

 2/28/2026

 IL

 Parkshore Estates Nursing Realty, LLC

 Parkshore Estates Nursing and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 2,454,187

 3.00
 %

 2.52
 %

 12/1/2024

 IL

 Midway Neurological and Rehabilitation Realty, LLC

 Midway Neurological and Rehabilitation Center, LLC

 50.00
 %

 50.00
 %

 2,547,713

 3.00
 %

 2.62
 %

 2/28/2026

 IL

 Oak Lawn Nursing Realty, LLC

 Oak Lawn Respiratory and Rehab center, LLC

 50.00
 %

 50.00
 %

 $
 637,092

 None

 0.65
 %

 6/1/2031

 None

 F- 33

 NOTES

 NOTE

 Lease

 (1)

 The
 interests of the two listed related parties are not held through any commonly owned holding companies. Mr. Gubin's interests
 are held directly/indirectly by Gubin Enterprises LP. Mr. Blisko's interests are held by Blisko Enterprises LP and New York
 Boys Management, LLC.

 (2)

 Each
 of the tenants is a limited liability company. The percentages listed reflect the owners' percentage ownership of the outstanding
 membership interests in each tenant.

 (3)

 For
 the initial two years of the lease there is no escalation, commencing with year three the escalation will be 22.3 %, year four the
 escalation will be 22.8 % and for years 5 through maturity the annual escalation will be 2 %.

 (4)

 The
 tenants have an option to buy the properties after 6 years for $ 127 million.

 Guarantees
from Related Parties

 As
of December 31, 2023 and 2022, Mr. Gubin and Mr. Blisko were not parties to any guarantees of any debt of the Company and its subsidiaries.

 Balances
with Related Parties

 Schedule of Balances with Related Parties

 2023

 2022

 2023

 2022

 (amounts in $000s)

 Straight-line rent receivable

 $
 18,921

 $
 11,591

 Tenant portion of replacement reserve

 $
 9,683

 $
 10,227

 Notes receivable

 $
 7,075

 $
 7,816

 Payments
from Related Parties

 Schedule of Payments From and to Related Parties

 2023

 2022

 Years ended December 31,

 2023

 2022

 (amounts in $000s)

 Rental income received from related parties

 $
 56,988

 $
 54,386

 F- 34

 NOTES

 NOTE

 Other
Related Party Relationships

 On
December 31, 2023 and 2022, the Company had approximately $ 1.2 million and $ 4.7 million, respectively, on deposit
with OptimumBank. Mr. Gubin is the Chairman of the Board of OptimumBank.

 On
June 14, 2022, the Company purchased a 7 % note receivable with an outstanding balance of $ 8 million from Infinity Healthcare Management,
a company controlled by Mr. Blisko and Mr. Gubin. The note is interest only with a balloon payment due July 1, 2024. The note receivable
is due from certain unaffiliated tenants.

 NOTE
12. Income Taxes

 The
Company elected and qualified to be taxed as a REIT for federal income tax purposes.

 As
a REIT, the Company generally is not subject to federal income tax on its net taxable income that it distributes currently to its stockholders.
Under the Code, REITs are subject to numerous organizational and operational requirements, including a requirement that they distribute
each year at least 90% of their REIT taxable income, determined without regard to the deduction for dividends paid and excluding any
net capital gains. If the Company fails to qualify for taxation as a REIT in any taxable year and does not qualify for certain statutory
relief provisions, the Company's income for that year will be taxed at regular corporate rates, and the Company would be disqualified
from taxation as a REIT for the four taxable years following the year during which the Company ceased to qualify as a REIT. Even if the
Company qualifies as a REIT for federal income tax purposes, it may still be subject to state and local taxes on its income and assets
and to federal income and excise taxes on its undistributed income.

 The Company follows accounting guidance relating to accounting for uncertainty in income taxes, which
sets out a consistent framework to determine the appropriate level of tax reserves to maintain for uncertain tax positions.

 A
tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of
tax benefit that has a greater than fifty percent likelihood of being realized upon settlement with a taxing authority that has full
knowledge of all relevant information. The determination of whether or not a tax position has met the more-than-likely-than-not recognition
threshold considers the facts, circumstances, and information available at the reporting date and is subject to management's judgment.
Management is not aware of any uncertain tax positions that would have material effect on the Company's
consolidated financial statements.

 F- 35

 NOTES

 NOTE
13. Fair Value of Financial Instruments

 The
Company is required to disclose the fair value of financials instruments for which it is practicable to estimate that value. The fair
value of short-term financial instruments such as cash and cash equivalents, restricted cash, accounts payable and accrued expenses approximate
their carrying value on the consolidated balance sheets due to their short-term nature. The Company's foreclosed real estate is
recorded at fair value on a non-recurring basis and is included in real estate investments on the consolidated balance sheets. Estimates
of fair value are determined based on a variety of information, including the use of available appraisals, estimates of market values
by licensed appraisers or local real estate brokers and knowledge and experience of management. The fair values of the Company's
remaining financial instruments that are not reported at fair value on the consolidated balance sheets are reported below:

of Fair Value on the Consolidated Balance Sheets

 2023

 2022

 (amounts in $000s)

 Level

 Carrying Amount

 Fair Value

 Carrying Amount

 Fair Value

 Notes payable, other debt, and bonds

 $
 539,145

 533,055

 $
 455,415

 454,523

 Notes receivable

 $
 17,706

 17,460

 $
 19,419

 18,479

 The
fair value of the notes payable, other debt, bonds and notes receivable are estimated using a discounted cash flow analysis.

 NOTE
14. Subsequent Events

 On February 8 2024, the BVI Company issued additional
Series D Bonds with a par value of NIS 100.0 million and raised a net amount of $ 26.7 million (NIS 98.2 million). The Bonds were issued
at a price of 106.3 %.

 On February 20, 2024 the Company entered into a
new, replacement master lease for the properties included in the Indiana acquisition completed in August of 2023. The tenant remains
a group of tenants affiliated with two of the Company's directors, Moishe Gubin and Michael Blisko. The new master lease has an
initial term of ten years and is subject to 2 five-year extensions. The initial annual base rent for the properties is $ 14.5 million
dollars and is subject to annual increases of 3 %. In connection with the new master lease, the existing purchase option held by the tenant,
which was granted by the prior owner of the properties, of $ 127.0 million was terminated. Consideration for the termination of the purchase
option and inducement for entering into the new, replacement master lease was $ 18.0 million paid to the tenants. The $ 18.0 million payment
was funded by cash and the proceeds from the additional Series D Bond issuance in February 2024.

 NOTE
15. Financing Income (Expenses), Net

 Schedule of Financing Income (Expenses), Net

 2023

 2022

 Year ended December 31,

 2023

 2022

 Financing expenses

 Interest expenses with respect to bonds

 $
 ( 6,669
)

 $
 ( 7,062
)

 Interest expenses on loans from banks and others

 ( 18,693
)

 ( 14,071
)

 Interest expenses with respect to leases

 ( 73
)

 ( 80
)

 Other financing expenses (including related parties), net

 ( 275
)

 ( 95
)

 Total financing expenses

 $
 ( 25,710
)

 $
 ( 21,308
)

 Financing income

 $
 1,267

 $

 Interest Expense, Net

 $
 ( 24,443
)

 $
 ( 20,507
)

 F- 36

 NOTES

III

 Real
Estate and Accumulated Depreciation

 Land

 lease

 SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation, Initial Cost of Furniture Fixtures

 Land

 lease

 SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation, Gross Amount Of Furniture Fixtures

 Total

 Initial
 Cost to Company

 Gross
 Amount at Which Carried at Close of Period

 and

 and

 and

 and

 Type
 of

 and

 and

 Accumulated

 Date
 of

 Date

 Land

 lease

 Land

 lease

 Total

 1020
 West Vine St, LLC

 IN

 SNF

 $

 73,704

 5,373,301

 552,994

 $

 73,704

 5,373,301

 552,994

 5,999,999

 2,014,053

 1968

 5/1/2015

 12803
 Lenover Street Realty, LLC

 IN

 SNF

 749,235

 11,715,266

 707,200

 749,235

 11,715,266

 707,200

 13,171,701

 5,261,743

 1898

 1600
 East Liberty Street Realty, LLC

 IN

 SNF

 226,684

 8,613,047

 684,202

 226,684

 8,613,047

 684,202

 9,523,933

 3,670,929

 1973

 1601
 Hospital Dr Realty, LLC

 IN

 SNF

 374,029

 6,536,475

 574,959

 374,029

 6,536,475

 574,959

 7,485,463

 2,809,600

 1981

 2055
 Heritage Dr Realty, LLC

 IN

 SNF

 397,029

 6,567,012

 592,208

 397,029

 6,567,012

 592,208

 7,556,249

 2,960,970

 1978

 3895
 Keystone Ave Realty, LLC

 IN

 SNF

 905,829

 5,401,715

 465,715

 905,829

 5,401,715

 465,715

 6,773,259

 2,354,758

 1985

 Rio Vista Lane Realty, LLC

 IN

 SNF

 851,889

 3,190,949

 277,894

 851,889

 3,190,949

 277,894

 4,320,732

 1,845,377

 1965

 Cross Ave Realty, LLC

 IN

 SNF

 1,055,229

 8,223,435

 793,445

 1,055,229

 8,223,435

 793,445

 10,072,109

 3,733,139

 1972

 East Highway 46 Realty, LLC

 IN

 SNF

 1,424,142

 12,353,018

 494,464

 1,424,142

 12,353,018

 494,464

 14,271,624

 4,798,322

 1975

 1350
 North Todd St, LLC

 IN

 SNF

 76,959

 3,151,485

 371,556

 76,959

 3,151,485

 371,556

 3,600,000

 1,876,239

 1976

 1712
 Leland Drive Realty, LLC

 IN

 SNF

 158,995

 5,399,959

 441,046

 158,995

 5,399,959

 441,046

 6,000,000

 2,517,249

 1977

 5/1/2015

 Bradington Drive, LLC

 IL

 SNF

 533,575

 6,030,915

 535,510

 533,575

 6,030,915

 535,510

 7,100,000

 3,288,680

 1993

 4/1/2011

 1621
 Coit Road Realty, LLC

 TX

 SNF

 1,466,005

 6,428,360

 771,979

 1,466,005

 6,428,360

 771,979

 8,666,344

 3,628,307

 1977

 7/1/2015

 8200
 National Ave Realty, LLC

 OK

 SNF/LTACH

 1,941,555

 8,519,002

 781,484

 1,941,555

 8,519,002

 781,484

 11,242,041

 3,194,366

 1989

 7/1/2015

 2301
 North Oregon Realty, LLC

 TX

 SNF/LTACH

 460,109

 9,224,188

 1,017,263

 460,109

 9,224,188

 1,017,263

 10,701,560

 3,841,287

 1970

 7/1/2015

 5601
 Plum Creek Drive Realty, LLC

 TX

 SNF/LTACH

 1,110,560

 8,585,477

 694,019

 1,110,560

 8,585,477

 694,019

 10,390,056

 3,783,211

 1985

 7/1/2015

 South Lincoln Street LLC

 IL

 SNF

 69,401

 3,401,111

 488,487

 -

 -

 -

 -

 -

 1974

 11/26/2014

 1623
 West Delmar Ave, LLC

 IL

 SNF

 369,094

 2,188,077

 257,828

 369,094

 2,188,077

 257,828

 2,814,999

 1,220,542

 1962

 11/26/2014

 Edwardsville Road LLC

 IL

 SNF

 251,415

 3,426,747

 387,838

 251,415

 3,426,747

 387,838

 4,066,000

 1,816,879

 1971

 11/26/2014

 South 3rd St Realty LLC

 MI

 SNF

 289,936

 4,022,959

 387,105

 289,936

 4,022,959

 387,105

 4,700,000

 1,911,642

 1969

 5/22/2015

 West Frech St, LLC

 IL

 SNF

 85,518

 1,697,527

 266,955

 85,518

 1,697,527

 266,955

 2,050,000

 1,720,303

 1974

 9/28/2011

 1316
 North Tibbs Avenue Realty LLC

 IN

 SNF

 323,226

 2,940,959

 335,816

 323,226

 2,940,959

 335,816

 3,600,001

 1,588,690

 1976

 6/1/2014

 F- 37

 Land

 lease

 SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation, Initial Cost of Furniture Fixtures

 Land

 lease

 SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation, Gross Amount Of Furniture Fixtures

 Total

 Initial
 Cost to Company

 Gross
 Amount at Which Carried at Close of Period

 and

 and

 and

 and

 Type
 of

 and

 and

 Accumulated

 Date
 of

 Date

 Land

 lease

 Land

 lease

 Total

 3090
 Five Points Hartford Realty, LLC

 OH

 SNF

 114,614

 1,348,246

 155,890

 114,614

 1,348,246

 155,890

 1,618,750

 1,286,468

 1950

 8/1/2015

 3121
 Glanzman Rd Realty, LLC

 OH

 SNF

 211,543

 2,977,780

 329,427

 211,543

 2,977,780

 329,427

 3,518,750

 1,802,967

 1959

 8/1/2015

 West Strub Rd Realty, LLC

 OH

 SNF

 140,266

 2,785,910

 192,574

 140,266

 2,785,910

 192,574

 3,118,750

 1,655,313

 1978

 8/1/2015

 4250
 Sodom Hutchings Road Realty, LLC

 OH

 SNF

 41,548

 581,176

 96,026

 41,548

 581,176

 96,026

 718,750

 645,233

 1975

 8/1/2015

 Ambassador
 Nursing Realty, LLC

 IL

 SNF

 2,344,176

 5,891,870

 991,190

 2,344,176

 5,891,870

 991,190

 9,227,236

 4,030,513

 1976

 4/1/2008

 Momence
 Meadows Realty, LLC

 IL

 SNF

 185,405

 5,861,271

 703,325

 185,405

 5,861,271

 703,325

 6,750,001

 3,888,263

 1974

 8/2/2006

 Oak
 Lawn Nursing Realty, LLC

 IL

 SNF

 808,226

 3,388,277

 403,497

 808,226

 3,388,277

 403,497

 4,600,000

 2,506,459

 1964

 4/30/2012

 Forest
 View Nursing Realty, LLC

 IL

 SNF

 392,245

 6,288,479

 819,276

 392,245

 6,288,479

 819,276

 7,500,000

 2,850,300

 1975

 11/25/2013

 Lincoln
 Park Holdings, LLC

 IL

 SNF

 4,322,851

 6,815,753

 861,396

 4,322,851

 6,815,753

 861,396

 12,000,000

 2,994,356

 1973

 11/26/2014

 Continental

 IL

 SNF

 3,392,263

 6,659,835

 720,666

 3,392,263

 6,659,835

 720,666

 10,772,764

 4,960,374

 1976

 4/2/2008

 Westshire

 IL

 SNF

 356,185

 22,165,811

 2,253,929

 356,185

 22,165,811

 2,253,929

 24,775,925

 10,001,998

 1974

 7/26/2013

 Belhaven

 IL

 SNF

 2,298,858

 7,026,385

 924,756

 2,298,858

 7,026,385

 924,756

 10,249,999

 6,144,461

 1985

 6/1/2006

 West
 Suburban Nursing Realty, LLC

 IL

 SNF

 1,061,095

 11,501,970

 1,336,935

 1,061,095

 11,501,970

 1,336,935

 13,900,000

 6,874,212

 1975

 11/2/2007

 Niles
 Nursing Realty, LLC

 IL

 SNF

 3,115,279

 21,168,943

 1,715,779

 3,115,279

 21,168,943

 1,715,779

 26,000,001

 9,744,838

 1974

 8/25/2012

 Parkshore
 Estates Nursing Realty, LLC

 IL

 SNF

 450,232

 18,186,687

 1,747,280

 450,232

 18,186,687

 1,747,280

 20,384,199

 6,931,505

 1975

 2/5/2015

 Midway
 Neurological and Rehab Realty, LLC

 IL

 SNF

 1,436,736

 15,856,182

 1,707,081

 1,436,736

 15,856,182

 1,707,081

 18,999,999

 11,700,105

 1972

 4/1/2005

 Woodlawn Drive, LLC

 TN

 SNF

 1,130,269

 9,411,746

 930,933

 1,130,269

 9,411,746

 930,933

 11,472,949

 3,391,512

 1995

 Buck Creek Road, LLC

 TN

 SNF

 829,555

 6,907,704

 683,254

 829,555

 6,907,704

 683,254

 8,420,513

 2,489,183

 1997

 5th Avenue East, LLC

 TN

 SNF

 684,383

 5,698,856

 563,684

 684,383

 5,698,856

 563,684

 6,946,923

 2,053,576

 1964

 2501
 River Road, LLC

 TN

 SNF

 829,555

 6,907,704

 683,254

 829,555

 6,907,704

 683,254

 8,420,513

 2,489,183

 1964

 Enon Springs East, LLC

 TN

 SNF

 943,619

 7,857,513

 777,201

 943,619

 7,857,513

 777,201

 9,578,333

 2,831,446

 1974

 Technology Lane, LLC

 TN

 SNF

 871,033

 7,253,089

 717,416

 871,033

 7,253,089

 717,416

 8,841,538

 2,613,643

 2007

 Union Street, LLC

 TN

 SNF

 995,467

 8,289,244

 819,904

 995,467

 8,289,244

 819,904

 10,104,615

 2,987,020

 1962

 West Maple Avenue, LLC

 KY

 SNF

 995,467

 8,289,244

 819,904

 995,467

 8,289,244

 819,904

 10,104,615

 2,987,020

 1970

 Big
 H2O - Land Rising Sun

 IN

 772,847

 -

 -

 772,847

 -

 -

 772,847

 -

 12/1/2012

 1585
 Perry Worth, LLC

 IN

 SNF

 98,516

 820,342

 81,142

 98,516

 820,342

 81,142

 1,000,000

 252,175

 1967

 7/17/2017

 1155
 Eastern Parkway, LLC

 KY

 SNF

 1,147,712

 18,894,131

 1,708,157

 1,147,712

 18,894,131

 1,708,157

 21,750,000

 5,314,614

 1973

 9/1/2017

 1015
 Magazine Street, LLC

 KY

 SNF

 2,750,000

 3,060,000

 690,000

 2,750,000

 3,060,000

 690,000

 6,500,000

 3,067,130

 1981

 5/1/2018

 5301
 Wheeler Avenue, LLC

 AR

 SNF

 400,000

 3,147,874

 877,500

 400,000

 3,147,874

 877,500

 4,425,374

 2,114,491

 1967

 Massey Avenue, LLC

 AR

 SNF

 125,000

 845,359

 240,000

 125,000

 845,359

 240,000

 1,210,359

 588,788

 1994

 Oak Grove Street, LLC

 AR

 SNF

 300,000

 2,641,399

 727,500

 300,000

 2,641,399

 727,500

 3,668,899

 1,652,599

 1965

 8701
 Riley Dr., LLC

 AR

 SNF

 950,000

 3,295,319

 1,050,000

 950,000

 3,295,319

 1,050,000

 5,295,319

 2,924,477

 1979

 1516
 Cumberland Street, LLC

 AR

 SNF

 325,000

 3,313,843

 325,000

 3,313,843

 4,538,843

 1,830,482

 1971

 5720
 West Markham Street, LLC

 AR

 SNF

 4,069,851

 1,155,000

 4,069,851

 1,155,000

 5,824,851

 1,893,030

 1973

 2501
 John Ashley Dr.,LLC

 AR

 SNF

 550,000

 3,695,319

 1,050,000

 550,000

 3,695,319

 1,050,000

 5,295,319

 3,110,291

 1969

 1513
 S. Dixieland Road, LLC

 AR

 SNF

 275,000

 3,060,608

 825,000

 275,000

 3,060,608

 825,000

 4,160,608

 1,786,912

 1968

 North Street, Stamps, LLC

 AR

 SNF

 225,000

 2,625,428

 705,000

 225,000

 2,625,428

 705,000

 3,555,428

 1,493,959

 1971

 Gagel Avenue, LLC

 KY

 SNF

 1,250,000

 2,390,000

 360,000

 1,250,000

 2,390,000

 360,000

 4,000,000

 1,560,890

 1970

 8/30/2018

 Life Care Way, LLC

 KY

 SNF

 200,000

 5,863,133

 750,000

 200,000

 5,863,133

 750,000

 6,813,133

 2,040,178

 1974

 2/19/2019

 1033
 North Highway 11, LLC

 KY

 SNF

 450,000

 5,976,921

 795,000

 450,000

 5,976,921

 795,000

 7,221,921

 1,997,941

 1978

 2/19/2019

 West Russell Street, LLC

 KY

 SNF

 350,000

 6,076,921

 795,000

 350,000

 6,076,921

 795,000

 7,221,921

 1,843,841

 1979

 2/19/2019

 9209
 Dollarway Road, LLC

 AR

 SNF

 500,000

 5,450,000

 500,000

 5,450,000

 6,850,000

 2,611,255

 2001

 3/27/2019

 F- 38

 Land

 lease

 SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation, Initial Cost of Furniture Fixtures

 Land

 lease

 SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation, Gross Amount Of Furniture Fixtures

 Total

 Initial
 Cost to Company

 Gross
 Amount at Which Carried at Close of Period

 and

 and

 and

 and

 Type
 of

 and

 and

 Accumulated

 Date
 of

 Date

 Land

 lease

 Land

 lease

 Total

 North 17th St, LLC 3523 Wickenhauser, LLC

 IL

 SNF

 613,116

 3,856,645

 663,640

 613,116

 3,856,645

 663,640

 5,133,401

 1,494,310

 1969,
 1971

 1/1/2019

 Lindley Lane, LLC

 AR

 SNF

 250,000

 2,917,353

 720,000

 250,000

 2, 917,353

 720,000

 3,887,353

 1,393,649

 2001

 4/10/2019

 2821
 West Dixon Road, LLC

 AR

 SNF

 400,000

 4,817,873

 354,000

 400,000

 4,817,873

 354,000

 5,571,873

 2,232,328

 1950

 4/10/2019

 Golf Links Road, LLC

 AR

 SNF

 500,000

 3,511,981

 912,000

 500,000

 3,511,981

 912,000

 4,923,981

 1,804,188

 1978

 4/10/2019

 9300
 Ballard Road, LLC

 IL

 SNF

 285,000

 12,467,584

 1,470,053

 285,000

 12,467,584

 1,391,952

 14,144,536

 4,008,960

 1974

 6/28/2019

 Land
 in Covington

 KY

 N/A

 94,922

 -

 -

 94,922

 -

 -

 94,922

 -

 N/A

 11/6/2015

 2400
 Chateau Drive Realty, LLC

 IN

 SNF

 327,804

 2,538,755

 283,441

 327,804

 2, 538,755

 283,441

 3,150,000

 748,392

 1972

 11/13/2019

 Bruce Court, LLC

 KY

 SNF

 150,000

 3,755,896

 477,000

 150,000

 3,755,896

 477,000

 4,382,896

 1,354,433

 1972

 6/1/2020

 4343
 Kennedy Drive LLC

 IL

 SNF

 1,650,000

 1,615,000

 735,000

 1,650,000

 1, 615,000

 735,000

 4,000,000

 895,354

 2009

 10/1/2020

 North Roan Street, LLC

 TN

 SNF

 650,000

 10,171,216

 504,000

 650,000

 10,171,216

 504,000

 11,325,216

 1,031,028

 2005

 14510
 Highway 79, LLC

 TN

 SNF

 525,000

 5,117,868

 396,000

 525,000

 5,117,868

 396,000

 6,038,868

 784,702

 1969

 6500
 Kirby Gate Boulevard, LLC

 TN

 SNF

 1,250,000

 17,345,000

 405,000

 1,250,000

 17,345,000

 405,000

 19,000,000

 1,376,258

 2015

 Highway 11 South, LLC

 TN

 SNF

 250,000

 9,965,900

 540,000

 250,000

 9, 965,900

 540,000

 10,755,900

 1,060,140

 1966

 2830
 Highway 394, LLC

 TN

 SNF

 475,000

 27,625,000

 475,000

 27,625,000

 29,000,000

 2,110,678

 2017

 1253
 Lake Barkley Drive, LLC

 KY

 SNF

 175,000

 4,496,940

 195,000

 175,000

 4,496,940

 195,000

 4,866,940

 741,121

 1968

 1123
 Rockdale

 MA

 Vacant

 -

 -

 -

 -

 -

 Jett Drive, LLC

 KY

 SNF

 100,000

 4,700,000

 100,000

 4, 700,000

 6,000,000

 397,409

 1971

 1/5/2023

 8400
 Clearvista Place, LLC

 IN

 ALF

 199,550

 4,939,068

 1,140,000

 199,550

 4,939,068

 1,140,000

 6,278,618

 128,388

 1985

 8400
 Clearvista Place, LLC

 IN

 SNF

 199,550

 2,504,532

 270,000

 199,550

 2,504,532

 270,000

 2,974,082

 43,672

 1985

 Anderson Road, LLC

 IN

 SNF

 182,300

 2,522,236

 182,300

 2,522,236

 3, 304,536

 76,831

 1984

 West Ellsworth Street, LLC

 IN

 SNF

 36,300

 3,750,050

 840,000

 36,300

 3,750,050

 840,000

 4,626,350

 110,609

 1957

 11563
 West 300 South LLC

 IN

 SNF

 47,200

 2,026,277

 460,000

 47,200

 2,026,277

 460,000

 2,533,477

 55,493

 1969

 5544
 East State Boulevard, LLC

 IN

 SNF

 492,800

 2,978,021

 770,000

 492,800

 2,978,021

 770,000

 4,240,821

 94,999

 1964

 South 100 West, LLC

 IN

 SNF

 86,000

 2,843,914

 650,000

 86,000

 2,843,914

 650,000

 3,579,914

 78,190

 1973

 2901
 West 37th Avenue, LLC

 IN

 SNF

 702,800

 4,255,515

 1,100,000

 702,800

 4,255,515

 1, 100,000

 6,058,315

 125,861

 1974

 1500
 Grant Street, LLC

 IN

 SNF

 118,700

 3,712,725

 850,000

 118,700

 3,712,725

 850,000

 4,681,425

 110,786

 1968

 North Detroit Street, LLC

 IN

 ALF

 50,400

 4,457,159

 1,000,000

 50,400

 4,457,159

 1,000,000

 5,507,559

 121,242

 1970

 North Detroit Street, LLC

 IN

 SNF

 50,400

 800,885

 85,000

 50,400

 800,885

 85,000

 936,285

 19,841

 1978

 Beechwood Avenue, LLC

 IN

 SNF

 29,600

 2,674,936

 29,600

 2,674,936

 3,304,536

 72,753

 1974

 Blair Pike, LLC

 IN

 SNF

 72,800

 5,787,027

 1,300,000

 72,800

 5,787,027

 1,300,000

 7,159,827

 170,950

 1966

 West Washington Street, LLC

 IN

 SNF

 44,100

 2,660,436

 44,100

 2,660,436

 3,304,536

 78,754

 1966

 East 11th Street, LLC

 IN

 ALF

 49,650

 4,367,758

 980,000

 49,650

 4,367,758

 980,000

 5,397,408

 128,943

 1967

 East 11th Street, LLC

 IN

 SNF

 49,650

 1,402,542

 145,000

 49,650

 1,402,542

 145,000

 1,597,192

 34,479

 1967

 West Wolfe Street, LLC

 IN

 ALF

 86,100

 4,105,930

 930,000

 86,100

 4,105,930

 930,000

 5,122,030

 96,432

 1970

 West Wolfe Street, LLC

 IN

 SNF

 110,200

 1,492,219

 160,000

 110,200

 1,492,219

 160,000

 1,762,419

 23,790

 1970

 East Pickwick Drive, LLC

 IN

 SNF

 206,500

 2,768,489

 660,000

 206,500

 2,768,489

 660,000

 3,634,989

 73,426

 1986

 Fairgrounds Road, LLC

 IN

 SNF

 94,500

 6,666,839

 1,500,000

 94,500

 6,666,839

 1,500,000

 8,261,339

 197,104

 1977

 1900
 Alber Street, LLC

 IN

 SNF

 819,000

 2,967,350

 840,000

 819,000

 2,967,350

 840,000

 4,626,350

 92,839

 1969

 1720
 Alber Street, LLC

 IN

 SNF

 360,000

 1,623,326

 440,000

 360,000

 1,623,326

 440,000

 2,423,326

 49,430

 1970

 North Washington Street, LLC

 IN

 SNF

 90,050

 5,905,004

 1,330,000

 90,050

 5,905,004

 1,330,000

 7,325,054

 138,164

 1984

 North Washington Street, LLC

 IN

 ALF

 90,050

 2,964,561

 305,000

 90,050

 2,964,561

 305,000

 3,359,611

 62,463

 2000

 Total

 $

 64,378,105

 $

 603,616,917

 $

 73,753,977

 $

 64,308,704

 $

 600,215,806

 $

 73,187,389

 $

 737,711,900

 $

 219,397,676

 F- 39

 NOTES

 The
changes in total real estate and accumulated depreciation are as follows (in thousands):

 2023

 2022

 For the year ended December 31,

 2023

 2022

 Cost

 Balance at beginning of the year

 $
 633,749

 632,036

 Acquisitions

 108,061

 1,713

 Disposals/other

 ( 4,098
)

 -

 Balance at end of the year

 $
 737,712

 633,749

 Accumulated Depreciation

 Balance at beginning of the year

 $
 194,838

 169,308

 26,207

 25,530

 Dispositions/other

 ( 1,647
)

 -

 Balance at end of the year

 $
 219,398

 194,838

 Net Real Estate

 $
 518,314

 438,911

 The
unaudited aggregate net tax value of real estate assets for federal income tax purposes as of December 31, 2023 is estimated to be $ 532,953,138.

 (1)
The cost of building and improvements is depreciated on a straight-line basis over the estimated useful lives of the buildings and improvements,
ranging primarily from 3 to 35 years. The cost of intangible lease assets is depreciated on a straight-line basis over the initial term
of the related leases, ranging primarily from 3 to 20 years. The cost of furniture, fixtures and equipment are depreciated on a straight-line
basis over the estimated useful lives of the furniture, fixtures and equipment, ranging primarily from 2 to 15 years. See Note 4 to the
consolidated financial statements for information on useful lives used for depreciation and amortization.

 (2)
LTACH — long-term acute care hospital, SNF — skilled nursing facility, and ALF — assisted living facility.

 F- 40