Investor Presentation June 2018

Investor Presentation June 2018

WARNING CONCERNING FORWARD LOOKING STATEMENTS THIS PRESENTATION CONTAINS STATEMENTS THAT CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO, WHENEVER WE USE WORDS SUCH AS BELIEVE, EXPECT, ANTICIPATE, INTEND, PLAN, ESTIMATE, WILL, MAY AND NEGATIVES OR DERIVATIVES OF THESE OR SIMILAR EXPRESSIONS, WE ARE MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON OUR PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR. FORWARD LOOKING STATEMENTS IN THIS PRESENTATION RELATE TO VARIOUS ASPECTS OF OUR BUSINESS, INCLUDING OUR POLICIES AND PLANS REGARDING INVESTMENTS, FINANCINGS AND DISPOSITIONS, OUR ABILITY TO RETAIN OUR EXISTING TENANTS, ATTRACT NEW TENANTS AND MAINTAIN OR INCREASE CURRENT RENTAL RATES, THE CREDIT QUALITIES OF OUR TENANTS, OUR ABILITY TO COMPETE FOR ACQUISITIONS AND TENANCIES EFFECTIVELY, OUR ACQUISITIONS AND SALES OF PROPERTIES, THE ABILITY OF THE MANAGER OF OUR MANAGED SENIOR LIVING COMMUNITIES TO MAINTAIN AND INCREASE OCCUPANCY, REVENUES AND OPERATING INCOME AT THOSE COMMUNITIES, OUR ABILITY TO PAY DISTRIBUTIONS TO OUR SHAREHOLDERS AND THE AMOUNT OF SUCH DISTRIBUTIONS, OUR ABILITY TO RAISE DEBT OR EQUITY CAPITAL, THE FUTURE AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY, OUR ABILITY TO PAY INTEREST ON AND PRINCIPAL OF OUR DEBT, OUR ABILITY TO APPROPRIATELY BALANCE OUR USE OF DEBT AND EQUITY CAPITAL, OUR CREDIT RATINGS, OUR BELIEF THAT THE AGING U.S. POPULATION AND INCREASING LIFE SPANS OF SENIORS WILL INCREASE THE DEMAND FOR SENIOR LIVING SERVICES AND OUR BELIEF THAT FIVE STAR SENIOR LIVING INC. (FIVE STAR), OUR FORMER SUBSIDIARY AND LARGEST TENANT AND THE MANAGER OF OUR MANAGED SENIOR LIVING COMMUNITIES, HAS ADEQUATE FINANCIAL RESOURCES AND LIQUIDITY AND THE ABILITY TO MEET ITS OBLIGATIONS TO US AND TO MANAGE OUR SENIOR LIVING COMMUNITIES SUCCESSFULLY. OUR ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY OUR FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS, SUCH AS THE IMPACT OF CONDITIONS AND CHANGES IN THE ECONOMY AND THE CAPITAL MARKETS ON US AND OUR TENANTS AND MANAGERS, THE IMPACT OF THE PATIENT PROTECTION AND AFFORDABLE CARE ACT (ACA), INCLUDING CURRENT PROPOSALS TO REPEAL OR TO REPEAL AND REPLACE THE ACA, AND OTHER EXISTING OR PROPOSED LEGISLATION OR REGULATIONS ON US, ON OUR TENANTS AND MANAGERS AND ON THEIR ABILITY TO PAY OUR RENTS AND RETURNS, ACTUAL AND POTENTIAL CONFLICTS OF INTEREST WITH OUR RELATED PARTIES, COMPLIANCE WITH, AND CHANGES TO APPLICABLE LAWS, REGULATIONS AND RULES, OUR ABILITY TO SATISFY COMPLEX RULES IN ORDER FOR US TO QUALIFY FOR TAXATION AS A REIT FOR U.S. FEDERAL INCOME TAX PURPOSES, COMPETITION WITHIN THE HEALTHCARE AND REAL ESTATE INDUSTRIES AND ACTS OF TERRORISM, OUTBREAKS OF SO CALLED PANDEMICS OR OTHER MANMADE OR NATURAL DISASTERS BEYOND OUR CONTROL. FOR EXAMPLE: (A) FIVE STAR MAY EXPERIENCE FINANCIAL DIFFICULTIES AS A RESULT OF A NUMBER OF FACTORS, INCLUDING CHANGES IN MEDICARE OR MEDICAID POLICIES, SUCH AS THOSE THAT MAY RESULT FROM THE ACA, WHICH COULD RESULT IN REDUCED MEDICARE OR MEDICAID RATES OR A FAILURE OF SUCH RATES TO COVER FIVE STAR S COSTS OR LIMIT THE SCOPE OR FUNDING OF EITHER OR BOTH PROGRAMS, THE IMPACT OF CHANGES IN THE ECONOMY AND THE CAPITAL MARKETS ON FIVE STAR AND ITS RESIDENTS AND OTHER CUSTOMERS, COMPETITION WITHIN THE SENIOR LIVING SERVICES BUSINESS, INCREASES IN INSURANCE AND TORT LIABILITY COSTS, INCREASES IN COMPLIANCE COSTS AND INCREASES IN FIVE STAR'S LABOR COSTS OR IN COSTS FIVE STAR PAYS FOR GOODS AND SERVICES; (B) IF FIVE STAR S OPERATIONS CONTINUE TO BE UNPROFITABLE, IT MAY DEFAULT ON ITS RENT OBLIGATIONS TO US; (C) IF FIVE STAR FAILS TO PROVIDE QUALITY SERVICES AT SENIOR LIVING COMMUNITIES THAT WE OWN, OUR INCOME FROM THESE COMMUNITIES MAY BE ADVERSELY AFFECTED; (D) OUR COMMUNITIES MAY FAIL TO BE COMPETITIVE AND THEY MAY FAIL TO ATTRACT RESIDENTS, DESPITE OUR CAPITAL INVESTMENTS; (E) OUR OTHER TENANTS MAY EXPERIENCE LOSSES AND DEFAULT ON THEIR RENT OBLIGATIONS TO US; (F) SOME OF OUR TENANTS MAY NOT RENEW EXPIRING LEASES, AND WE MAY BE UNABLE TO OBTAIN NEW TENANTS TO MAINTAIN OR INCREASE THE HISTORICAL OCCUPANCY RATES OF, OR RENTS FROM, OUR PROPERTIES; (G) WE MAY BE UNABLE TO PAY OUR DEBT OBLIGATIONS WHEN THEY BECOME DUE OR TO MAINTAIN OUR CURRENT RATE OF DISTRIBUTIONS ON OUR COMMON SHARES AND FUTURE DISTRIBUTIONS MAY BE REDUCED OR ELIMINATED; (H) WE MAY BE UNABLE TO IDENTIFY PROPERTIES THAT WE WANT TO ACQUIRE OR TO NEGOTIATE ACCEPTABLE PURCHASE PRICES, ACQUISITION FINANCING, MANAGEMENT AGREEMENTS OR LEASE TERMS FOR NEW PROPERTIES; (I) RENTS THAT WE CAN CHARGE AT OUR PROPERTIES MAY DECLINE BECAUSE OF CHANGING MARKET CONDITIONS OR OTHERWISE; (J) CONTINGENCIES IN OUR ACQUISITION AND SALE AGREEMENTS MAY NOT BE SATISFIED AND OUR PENDING ACQUISITIONS AND SALES AND ANY RELATED LEASES OR MANAGEMENT ARRANGEMENTS WE MAY EXPECT TO ENTER INTO MAY NOT OCCUR, MAY BE DELAYED OR THE TERMS OF SUCH TRANSACTIONS OR ARRANGEMENTS MAY CHANGE; (K) OUR ACQUISITIONS ARE SUBJECT TO CONDITIONS THAT MAY NOT BE MET AND OUR ACQUISITIONS AND RELATED MANAGEMENT AND POOLING ARRANGEMENTS MAY NOT OCCUR, MAY BE DELAYED OR THEIR TERMS MAY CHANGE; (L) WE CANNOT BE SURE THAT WE WILL ENTER INTO ANY ADDITIONAL LEASES, MANAGEMENT ARRANGEMENTS OR OTHER TRANSACTIONS WITH FIVE STAR; (M) CONTINUED AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY IS SUBJECT TO OUR SATISFYING CERTAIN FINANCIAL COVENANTS AND OTHER CREDIT FACILITY CONDITIONS THAT WE MAY BE UNABLE TO SATISFY; (N) ACTUAL COSTS UNDER OUR REVOLVING CREDIT FACILITY OR OTHER FLOATING RATE CREDIT FACILITIES WILL BE HIGHER THAN LIBOR PLUS A PREMIUM BECAUSE OF FEES AND EXPENSES ASSOCIATED WITH SUCH FACILITIES; (O) OUR OPTION TO EXTEND THE MATURITY DATE OF OUR REVOLVING CREDIT FACILITY IS SUBJECT TO OUR PAYMENT OF A FEE AND MEETING OTHER CONDITIONS THAT MAY NOT BE MET; (P) OUR RESIDENTS AND PATIENTS MAY BECOME UNABLE TO FUND OUR CHARGES WITH PRIVATE RESOURCES AND WE MAY BE REQUIRED OR MAY ELECT FOR BUSINESS REASONS TO ACCEPT OR PURSUE REVENUES FROM GOVERNMENT SOURCES, WHICH COULD RESULT IN AN INCREASED PART OF OUR NET OPERATING INCOME (NOI) AND REVENUE BEING GENERATED FROM GOVERNMENT PAYMENTS AND OUR BECOMING MORE DEPENDENT ON GOVERNMENT PAYMENTS; (Q) CIRCUMSTANCES THAT ADVERSELY AFFECT THE ABILITY OF SENIORS OR THEIR FAMILIES TO PAY FOR OUR TENANTS AND MANAGER S SERVICES, SUCH AS ECONOMIC DOWNTURNS, WEAK HOUSING MARKET CONDITIONS, HIGHER LEVELS OF UNEMPLOYMENT AMONG OUR RESIDENTS FAMILY MEMBERS, LOWER LEVELS OF CONSUMER CONFIDENCE, STOCK MARKET VOLATILITY AND/OR CHANGES IN DEMOGRAPHICS GENERALLY COULD AFFECT THE PROFITABILITY OF OUR SENIOR LIVING COMMUNITIES; (R) OUR UNSPENT LEASING RELATED OBLIGATIONS MAY COST MORE OR LESS AND MAY TAKE LONGER TO COMPLETE THAN WE CURRENTLY EXPECT, AND WE MAY INCUR INCREASING AMOUNTS FOR THESE AND SIMILAR PURPOSES IN THE FUTURE; (S) WE MAY NOT BE ABLE TO SELL PROPERTIES THAT WE DETERMINE TO OFFER FOR SALE ON TERMS ACCEPTABLE TO US OR OTHERWISE AND (T) OPERATING DEFICIENCIES OR A LICENSE REVOCATION AT ONE OR MORE OF OUR SENIOR LIVING COMMUNITIES MAY ADVERSELY IMPACT OUR ABILITY TO OBTAIN LICENSES FOR, OR ATTRACT RESIDENTS TO, OUR OTHER COMMUNITIES. OUR ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2017, OUR QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2018 AND OUR OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION (SEC) IDENTIFY OTHER IMPORTANT FACTORS THAT COULD CAUSE DIFFERENCES FROM OUR FORWARD LOOKING STATEMENTS. OUR FILINGS WITH THE SEC ARE AVAILABLE ON THE SEC S WEBSITE AT WWW.SEC.GOV. YOU SHOULD NOT PLACE UNDUE RELIANCE UPON OUR FORWARD LOOKING STATEMENTS. EXCEPT AS REQUIRED BY LAW, WE DO NOT INTEND TO UPDATE OR CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE. NON-GAAP FINANCIAL MEASURES THIS PRESENTATION CONTAINS NON-GAAP FINANCIAL MEASURES INCLUDING NORMALIZED FUNDS FROM OPERATIONS (FFO), ADJUSTED EBITDA, NOI AND CASH BASIS NOI. RECONCILIATIONS FOR THESE METRICS TO THE CLOSEST U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) METRICS ARE INCLUDED IN AN APPENDIX HERETO. 2

SNH - HEALTHCARE REAL ESTATE Quality Portfolio Predominantly private pay assets with limited exposure to government reimbursement programs such as Medicare & Medicaid. Diversification in geography, tenant, and asset mix. Maintains quality through regular investment and active asset management. Positive Healthcare Industry Fundamentals National health spending is projected to grow at an average rate of 5.5% per year (1). The demand for senior housing from the aging population is expected to exceed supply. 10,000 Baby Boomers turning 65 every day (2). Secured Dividend Current annualized dividend of $1.56 per share or a 10% yield (3). Normalized FFO payout ration of 86% for the trailing twelve months (4). Conservative Financial Strategy Ample liquidity with a strong balance sheet. Investment grade ratings by Moody s (Baa3) and S&P (BBB-). (1) Source: Centers for Medicare & Medicaid Services, www.cms.gov. (2) Source: U.S. Census Bureau. (3) As of March 31, 2018 (4) Excludes the business management incentive fee expense in Q4 2017. 3

COMPANY OVERVIEW Focused Growth Medical office and life science buildings, and private pay senior living communities. Substantial Size $8.6 billion investment portfolio. Geographic Diversity Properties in 42 states and Washington, D.C. Independent Living 28% Assisted Living 24% Life Science 22% Property Mix (1) Credit Diversity Approximately 700 tenants. Private Pay Limited government funding exposure with approximately 97% of NOI from private pay properties (2). Skilled Nursing 3% Wellness Centers 3% Medical Office 20% Investment Grade Rating S&P: BBB- Moody s: Baa3 Wt. Avg. Maturity: 8.6 years Adjusted EBITDA (3) / Interest Expense: 3.6x Total Debt (4) / Annualized Adjusted EBITDA (3) : 5.8x Secured Debt (4) / Total Assets: 11% (1) Based on Q1 2018 NOI. See exhibits herein for the calculation of NOI and a reconciliation of net income determined in accordance with GAAP to that amount. (2) Defined as properties categorized as MOBs, wellness centers and senior living communities in which the majority of the revenues are derived from private pay sources. (3) See page 20 for the calculation of Adjusted EBITDA and a reconciliation of net income determined in accordance with GAAP to that amount. (4) Debt amounts represent the principal balance as of March 31, 2018. 4

GEOGRAPHIC DIVERSIFICATION (1) 32 Other States + D.C. 37% MA 14% CA 11% IN 3% VA 3% NC 3% MD 4% WI 4% GA 5% TX 7% FL 9% $8.6 billion invested in 444 properties located in 42 states and Washington, D.C. Note: Blue colored states represent states where SNH owns properties. (1) Based on cost of real estate properties as of March 31, 2018. Cost of real estate properties is before depreciation and less impairment write downs, if any. 5

HIGH QUALITY MOB PORTFOLIO 12.6 million square feet in 129 properties located in 28 states and Washington, D.C. Concord, MA. Tenant: Harvard Vanguard. Square feet: 49,250. Los Angeles, CA. Tenant: Cedars-Sinai Medical Center. Square feet: 330,892. Sheboygan, WI. Tenant: Aurora Healthcare, Inc. Square feet: 154,423. Approximately 700 tenants with occupancy of 95.1% at March 31, 2018. Durham, NC. Tenant: Duke University Health System. Square feet: 126,225. San Diego, CA. Tenant: The Scripps Research Institute. Square feet: 164,091. Irving, TX. Tenant: Hospital Corporation of America. Square feet: 94,137. Note: Coverage ratio and occupancy are for the twelve months ended December 31, 2017. 6

Population - millions MEDICAL OFFICE INDUSTRY DYNAMICS Aging US Population By 2029, more than 20 percent of the total U.S. population will be over the age of 65. 90 80 70 60 50 40 30 20 10 Population Growth (1) 15.6% 13.1% 6.5 5.5 14.7 20.6% 19.0% 16.9% 9.1 7.4 21.4% 11.8 6.7 21.1 25.4 28.7 16.6 13.1 29.7 32.8 36.6 38.7 37.5 21.9 25% 20% 15% 10% 5% ($ in billions) National Healthcare Expenditures (2) 0 2010 2017 2020 2025 2030 2035 65-74 75-84 85+ 65+ % of population 0% $5,000 $4,000 $3,000 $2,000 Demand for Healthcare National health spending is projected to grow at an average rate of 5.5% per year and reach $5.7 trillion by 2026. $1,000 $0 2017 2020 2023 2026 (1) Source: U.S. Census Bureau. (2) Source: Centers for Medicare & Medicaid Services, www.cms.gov. 7

MEDICAL OFFICE AND LIFE SCIENCE PORTFOLIO Largest MOB Tenants ($ in 000s) Square Feet Annualized Rental Income (1) % (1) Lease Expiration Vertex Pharmaceuticals, Inc. (2) 1,082,000 $91,781 (2) 11.7% (2) 2028 Advocate Aurora Health 643,000 $16,896 2.1% 2024 Cedars-Sinai Medical Center 142,000 $14,312 1.8% 2018 2025 The Scripps Research Institute 164,000 $10,178 1.3% 2019 HCA Healthcare Inc. 243,000 $7,782 1.0% 2018 2025 Reliant Medical Group, Inc. 362,000 $7,595 1.0% 2019 40% MOB Annualized Rental Income Expiring 36% 30% 20% Pharmaceutical company with a focus on medicines that treat cystic fibrosis 10% 0% 4% 11% 9% 6% 8% 5% 11% 4% 5% Market Cap. of approximately $40 billion LTM revenues of $2.4 billion Approved medicines include SYMDEKO, ORKAMBI, and KALYDECO (1) Annualized rental income is rents pursuant to existing leases as of March 31, 2018. Annualized rental income includes straight line rent adjustments and estimated recurring expense reimbursements for certain net and modified gross leases; excludes lease value amortization at certain of the MOBs. 8 (2) The property leased by this tenant is owned by a joint venture, of which we own a 55% equity interest. Rental income presented includes 100% of rental income as reported under GAAP.

MEDICAL OFFICE BUILDING SEGMENT 38% Patient Care Clinics, outpatient centers, and doctors offices. Life Science Laboratory and research space. Medical Office Buildings (1) 52% 10% Other Medical Related Medical equipment manufacturing & other medical related tenants. (1) Based on Q1 2018 NOI. See exhibits herein for the calculation of NOI and a reconciliation of net income determined in accordance with GAAP 9 to that amount.

OVERLAND PARK, KANSAS 6700 WEST 115 TH STREET ACQUIRED: PROPERTY TYPE: CBSA: PURCHASE PRICE (1) : SQUARE FOOTAGE: CAP RATE (2) : MAJOR TENANT (% sq. ft.): REMAINING LEASE TERM (3) : OCCUPANCY (4) : 1/3/2018 Life Science Kansas City, MO-KS $44.6 million 239 K 9.4% IQVIA Holdings, Inc. (74%) 5.8 years 100% Summary: Originally designed as a build-to-suit for IQVIA Holdings, Inc. IQVIA utilizes part of the space as a missioncritical, highly specialized clinical study and research facility. This is the firm s only facility of its kind in the United States and is one of only three in the world. IQVIA Holdings, Inc. Investment grade credit rating of S&P: BBB- and Market Cap of over $21 billion. Leading global provider of advanced analytics, technology solutions, and contract research services to the life sciences industry. (1) Represents the purchase price, including assumed debt, if any, and excludes acquisition costs and purchase price allocation adjustments, if any. (2) Represents the ratio of the estimated GAAP-based annual rental income, excluding the impact of above and below market lease amortization, less estimated annual property operating expenses, if any, and excluding depreciation and amortization expense, to the purchase price on the date of acquisition, including the principal amount of any assumed debt and excluding acquisition costs. (3) Represents the weighted average remaining lease term based on rental income at the time of acquisition. (4) Occupancy based on leasable square feet as of the acquisition date. 10

CREVE COEUR, MISSOURI CITY PLACE 5 ACQUIRED: PROPERTY TYPE: CBSA: PURCHASE PRICE (1) : SQUARE FOOTAGE: CAP RATE (2) : MAJOR TENANT (% sq. ft.): REMAINING LEASE TERM (3) : OCCUPANCY (4) : 1/22/2018 Medical Office St. Louis, MO-IL $21.8 million 82 K 8.0% Signature Health (41%) 4 years 90% Summary: The Property is leased to medical tenants offering a variety of services, including orthopedics, dentistry, plastic surgery, internal medicine, nutrition and multi-specialty medicine. In addition, the property is 17% leased to City Place Surgery Center, a privately owned, ambulatory surgery center equipped with four operating rooms featuring the latest in surgical technology. Signature Health Services, Inc. A division of Signature Medical Group, the largest independent physician-owned multi-specialty group in the St. Louis and Kansas City areas. Specialized in Orthopedic Surgery and Sports Medicine. (1) Represents the purchase price, including assumed debt, if any, and excludes acquisition costs and purchase price allocation adjustments, if any. (2) Represents the ratio of the estimated GAAP-based annual rental income, excluding the impact of above and below market lease amortization, less estimated annual property operating expenses, if any, and excluding depreciation and amortization expense, to the purchase price on the date of acquisition, including the principal amount of any assumed debt and excluding acquisition costs. (3) Represents the weighted average remaining lease term based on rental income at the time of acquisition. (4) Occupancy based on leasable square feet as of the acquisition date. 11

SAN JOSE, CALIFORNIA 2904 ORCHARD PARKWAY ACQUIRED: PROPERTY TYPE: CBSA: PURCHASE PRICE (1) : SQUARE FOOTAGE: CAP RATE (2) : MAJOR TENANT (% sq. ft.): REMAINING LEASE TERM (3) : OCCUPANCY (4) : 1/25/2018 Life Science San Jose-Santa Clara, CA $24.7 million 79 K 8.5% Complete Genomics (100%) 8.1 years 100% Summary: Central Silicon Valley location. Recently renovated office / research and development building in which the tenants has invested in customized tenant improvements including specialized lab areas, clean rooms, and mechanical equipment. Complete Genomics, Inc. A wholly owned subsidiary of BGI, the world s largest genomics services company in the world. An established technology leader in whole human genome sequencing using proprietary sequencing instruments, chemistry and software. (1) Represents the purchase price, including assumed debt, if any, and excludes acquisition costs and purchase price allocation adjustments, if any. (2) Represents the ratio of the estimated GAAP-based annual rental income, excluding the impact of above and below market lease amortization, less estimated annual property operating expenses, if any, and excluding depreciation and amortization expense, to the purchase price on the date of acquisition, including the principal amount of any assumed debt and excluding acquisition costs. (3) Represents the weighted average remaining lease term based on rental income at the time of acquisition. (4) Occupancy based on leasable square feet as of the acquisition date. 12

SENIOR LIVING PORTFOLIO 305 properties with 34,205 units located in 39 states Granite Gate. Prescott, AZ. 127 Units. The Stratford. Carmel, IN. 213 Units. Calusa Harbour. Ft Myers, FL. 440 Units. Operators include: Five Star Senior Living, Brookdale Senior Living, and 11 private senior living operators Remington Club. San Diego, CA. 405 Units. The Gables. Winchester, MA. 125 Units. Park Summit. Coral Springs, FL. 281 Units. 13

Units Millions SENIOR LIVING INDUSTRY DYNAMICS 11,000 10,000 9,000 Senior Housing Supply-Demand Age 85+ Population (2) 20 Trends (1) 92% 16 91% 9% 8% 7% 8,000 7,000 6,000 90% 12 6% 5% 5,000 4,000 89% 8 4% 3% 3,000 2,000 88% 4 2% 1,000 87% 1% 0 0 0% -1,000 86% Inventory Growth Absorption Occupancy 85+ Population Growth Rate (%) New supply is modest in comparison to aging population growth. (1) Source: National Investment Center for the Seniors Housing and Care Industry (NIC), as of March 31, 2018. (2) Source: U.S. Census Bureau, 2014 National Population Projections. 14

SENIOR LIVING OPERATORS Operator Unit Mix Number of Communities (1) Units (1) Occupancy (2) Rental Coverage (2) Five Star Senior Living IL, AL, ALZ, SNF 185 20,133 82.1% 1.15x Sunrise Senior Living (3) IL 1 354 N/A N/A Brookdale Senior Living AL 18 940 84.0% 2.30x 11 Private Operators IL, AL, SNF 29 3,520 86.6% 1.21x Managed Senior Living IL, AL, ALZ, SNF 72 9,258 85.8% N/A Total Senior Living 305 34,205 83.6% 1.20x The 4 th largest senior living operator in the nation. Publicly traded company with strong balance sheet. $0 drawn on revolving $100 million credit facility. Owns 20 communities with only one encumbered by a $8 million mortgage. (1) Number of communities and units are as of March 31, 2018. (2) Operator occupancy and rental coverage are presented for the twelve month period ended December 31, 2017. Rental coverage is calculated as operating cash flow from our tenants operations of properties, before subordinated charges, divided by rents payable to us. 15 (3) In March 2018, we sold two senior living communities leased to a subsidiary of Sunrise Senior Living, LLC, or Sunrise. We currently have one senior living community leased to Sunrise under agreement to sell. We expect the closing of the sale of this community to occur by the end of the second quarter of 2018.

INVESTMENT GRADE BALANCE SHEET Unsecured Senior Notes BBB- / Baa3 $2.25 billion of senior notes due in 2019, 2020, 2021, 2024, 2028, 2042 and 2046 Mortgage Debt & Capital Leases 94% of properties are unencumbered $829 million secured by 26 properties (1) Unsecured Senior Notes 30% Unsecured Term Loans $350 million non-revolving term loan. Matures in January 2020. $200 million non-revolving term loan. Matures in September 2022. Unsecured Credit Facility $1 billion revolving credit facility. $55 million outstanding. LIBOR plus 120 basis points. Matures in January 2022, with option to extend to 2023. Market Value of Common Shares 51% Mortgage Debt 11% Unsecured Term Loans 7% Unsecured Revolving Credit Facility 1% (1) Includes $620 million of debt related to our 55% owned joint venture secured by one property. 16

CONSERVATIVE FINANCIAL PROFILE Total Debt as a % of Gross Assets Debt Maturity Schedule (2) 45% 40% 41.0% $1,200 $1,000 35% $800 30% 25% 20% 15% $600 $400 $200 10% $- SNH SNL US REIT Healthcare Index Unsecured Floating Unsecured Fixed Secured Fixed No derivatives, no off balance sheet liabilities and no material adverse change clauses or ratings triggers. 17

$1.23 $1.24 $1.25 $1.28 $1.30 $1.38 $1.40 $1.42 $1.45 $1.49 $1.53 $1.56 $1.56 $1.56 $1.56 $1.56 $1.56 HISTORY OF RETURNS TO INVESTORS Dividends Paid Per Share (1) 600% Total Return (2) $1.60 94% $1.55 92% 500% $1.50 $1.45 $1.40 $1.35 $1.30 90% 88% 86% 84% 400% 300% 200% $1.25 $1.20 82% 80% 100% $1.15 78% 0% Annual Dividends Paid Normalized FFO Payout Ratio SNH SNL U.S. REIT Equity Normalized FFO payout ratio of 86% for the trailing twelve months Q1 2018. 447% total return over the last 15 years. 18

PREFERRED PORTFOLIO COMPOSITION 100% 3% 4% 3% 7% 90% 17% 80% 22% 25% 20% 70% 60% 20% 26% 14% 45% 83% 50% 15% 40% 3% 7% 34% 30% 14% 11% 1% 20% 37% 10% 13% 25% 24% 27% 0% SNH OHI HCP VTR WELL Senior Housing - NNN Skilled Nursing Senior Housing - Managed Hospitals MOBs Life Science Other Source: Company filings and presentations. SNH, HCP, VTR and WELL shown as a percentage of NOI. OHI shown as a percentage of revenue. 19

HEALTHCARE REIT PEER COMPARISON Source: SNL Financial; data is actual as of the most recent quarter reported. 20

EXTERNAL MANAGEMENT SNH obtains high quality and cost-effective management services from The RMR Group (Nasdaq: RMR) for its real estate operating platform. RMR s Operations Include: Healthcare REIT G&A Comparison: Financial Services: Real Estate Services: Business Services: (1)(2) Accounting Acquisitions / Dispositions Administration Capital Markets Asset Management Human Resources Compliance / Audit Construction Information Technology (IT) Finance Engineering Investor Relations Financial Planning Tax Leasing Property Management Legal Risk Management (1) Source: SNL Financial (2) Excludes the business management incentive fee expense in 4Q17. 21

MANAGEMENT FEES AND ALIGNED INTERESTS In June 2015 SNH and three other managed public REITs, acquired approximately half of The RMR Group. Further Aligned Interests The historical owners of RMR have become owners of a significant number of restricted shares of SNH and those shares are subject to 10 year lock up agreements. SNH and its shareholders own RMR shares and share in future profits from new businesses of the external manager. There is greater transparency for SNHs shareholders into RMR management. Revised Fee Structure Business Management Fee: Incentive Fee: Property Management Fee: Principally consists of an annual fee based on 50 bps multiplied by the lower of: (1) SNH s historical cost of real estate, or (2) SNH s total market capitalization. Equal to 12% of value generated by SNH in excess of benchmark index total returns per share over a three year period, subject to a cap (1.5% of equity market cap). Principally consists of an annual fee based on 3.0% of gross rents collected at SNH s MOB properties. 22

DEDICATED & DISCIPLINED BUSINESS PLAN Active asset management and investing internally We invest in medical office buildings through capital improvements or strategic repositioning to attract high quality tenants. We evaluate expansion and conversion projects in senior living communities to take advantage of opportunities in certain markets where demand is evident. External Growth We selectively acquire properties with a focus on high quality life science and medical office properties in strategic locations. We monitor senior housing and opportunistically acquire private pay communities. Maintaining investment grade rated financial profile Grow FFO. Monitor debt market. Assess alternative sources to optimize weighted average cost of capital. 23

EXHIBITS

FINANCIAL SUMMARY ($ in 000's, except per share data) For the Three Months Ended 3/31/2018 3/31/2017 Rental Income $173,728 $166,443 Residents fees and services (managed properties) 102,087 98,118 Total revenues $275,815 $264,561 Property net operating income (NOI) (1) $167,672 $163,504 NOI margin % 68.8% 61.8% Adjusted EBITDA (1) $157,844 $152,984 Normalized funds from operations (FFO) (1) $107,163 $108,432 Per share data: Common dividend $0.39 $0.39 Normalized FFO $0.45 $0.45 Normalize FFO payout ratio 86.7% 84.8% (1) See following pages for reconciliations to nearest GAAP measures. 25

CALCULATION AND RECONCILIATION OF NET OPERATING INCOME (NOI) AND CASH BASIS NOI (1) ($ in 000's) For the Three Months Ended 3/31/2018 12/31/2017 9/30/2017 6/30/2017 3/31/2017 Calculation of NOI and Cash Basis NOI: Revenues: Rental income 173,728 179,585 168,348 166,647 166,443 Residents fees and services 102,087 98,981 98,331 98,366 98,118 Total revenues 275,815 278,566 266,679 265,013 264,561 Property operating expenses (108,143) (104,865) (104,714) (102,795) (101,057) Property net operating income (NOI): 167,672 173,701 161,965 162,218 163,504 Non-cash straight line rent adjustments (2,993) (3,473) (3,621) (3,435) (3,429) Lease value amortization (1,381) (1,386) (1,352) (1,320) (1,291) Non-cash amortization included in property operating expenses (2) (199) (200) (199) (199) (199) Cash Basis NOI 163,099 168,642 156,793 157,264 158,585 Reconciliation of Net Income to NOI and Cash Basis NOI: Net income 237,405 66,328 35,793 17,402 32,281 Gain on sale of properties (181,154) (46,055) Income before gain on sale of properties 56,251 20,273 35,793 17,402 32,281 Equity in earnings of an investee (44) (75) (31) (374) (128) Income tax expense 260 154 109 99 92 Loss on early extinguishment of debt 130 274 7,353 Interest expense 43,552 40,625 40,105 40,800 43,488 Interest and other income (54) (83) (128) (76) (120) Unrealized gains and losses on equity investments, net (27,241) Dividend income (659) (659) (659) (659) (659) Operating income 72,195 60,235 75,463 64,545 74,954 Impairment of assets 5,082 Acquisition and certain other transaction related costs 20 255 292 General and administrative expense 25,118 45,813 19,883 22,922 15,083 Depreciation and amortization expense 70,339 67,398 66,619 69,669 73,175 Property NOI 167,672 173,701 161,965 162,218 163,504 Non-cash amortization included in property operating expenses (2) (199) (200) (199) (199) (199) Lease value amortization (1,381) (1,386) (1,352) (1,320) (1,291) Non-cash straight line rent adjustments (2,993) (3,473) (3,621) (3,435) (3,429) Cash Basis NOI 163,099 168,642 156,793 157,264 158,585 (1) See page 22 for a definition of NOI and Cash Basis NOI, a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) We recorded a liability for the amount by which the estimated fair value for accounting purposes exceeded the price we paid for our investment in RMR Inc. common stock in June 2015. A portion of this liability is being amortized on a straight line basis through December 31, 2035 as a reduction to property management fees expense, which is included in property operating expenses.+ 26

CALCULATION AND RECONCILIATION OF EBITDA AND ADJUSTED EBITDA (1) ($ in 000's) For the Three Months Ended 3/31/2018 12/31/2017 9/30/2017 6/30/2017 3/31/2017 Net income $237,405 $66,328 $35,793 $17,402 $32,281 Interest expense 43,552 40,625 40,105 40,800 43,488 Income tax expense 260 154 109 99 92 Depreciation and amortization expense 70,339 67,398 66,619 69,669 73,175 EBITDA 351,556 174,505 142,626 127,970 149,036 General and administrative expense paid in common shares (2) 186 530 593 643 390 Estimated business management incentive fees (3) 14,347-22,048 8,022 10,760 3,266 Acquisition and certain other transaction related costs 20 255 292 Impairment of assets 5,082 Loss on early extinguishment of debt 130 274 7,353 Gain on sale of properties -181,154-46,055 Unrealized gains and losses on equity securities, net (4) -27,241 Adjusted EBITDA $157,844 $107,187 $151,515 $151,808 $152,984 (1) See page 22 for a definition of EBITDA and Adjusted EBITDA and a description of why we believe they are appropriate supplemental measures. (2) Amounts represent equity compensation awarded to our trustees, officers and certain other employees of RMR LLC. (3) Incentive fees under our business management agreement with RMR LLC are payable after the end of each calendar year, are calculated based on common share total return, as defined, and are included in general and administrative expense in our condensed consolidated statements of income. In calculating net income in accordance with GAAP, we recognize estimated business management incentive fee expense, if any, in the first, second and third quarters. Although we recognize this expense, if any, in the first, second and third quarters for purposes of calculating net income, we do not include these amounts in the calculation of Adjusted EBITDA until the fourth quarter, when the amount of the business management incentive fee expense for the calendar year, if any, is determined. Adjusted EBITDA includes business management incentive fee expense of $55,740 for the three months ended December 31, 2017. Excluding business management incentive fee expense, Adjusted EBITDA would have been $162,927 for the three months ended December 31, 2017. (4) Represents the unrealized gains and losses on equity securities, net, to adjust the carrying value of our investments to fair value in accordance with a change in GAAP standards effective January 1, 2018. 27

CALCULATION AND RECONCILIATION OF FUNDS FROM OPERATION (FFO) AND NORMALIZED FFO (1) ($ in 000's, except per share data) For the Three Months Ended 3/31/2018 12/31/2017 9/30/2017 6/30/2017 3/31/2017 Net income attributable to common shareholders 236,022 65,000 34,414 16,042 32,155 Depreciation and amortization expense 70,339 67,398 66,619 69,669 73,175 Noncontrolling interest's share of net FFO adjustments (5,300) (5,304) (5,305) (5,305) (456) Gain on sale of properties (181,154) (46,055) Impairment of assets 5,082 FFO 119,907 81,039 95,728 85,488 104,874 Estimated business management incentive fees (2) 14,347 (22,048) 8,022 10,760 3,266 Acquisition and certain other transaction related costs 20 255 292 Loss on early extinguishment of debt 130 274 7,353 Unrealized gains and losses on equity securities, net (3) (27,241) Normalized FFO $107,163 $59,246 $104,024 $103,601 $108,432 Weighted average common shares outstanding (basic) 237,478 237,467 237,421 237,399 237,391 Weighted average common shares outstanding (diluted) 237,493 237,475 237,460 237,445 237,416 Per Common Share Data (basic and diluted): Net income attributable to common shareholders $0.99 $0.27 $0.14 $0.07 $0.14 FFO $0.50 $0.34 $0.40 $0.36 $0.44 Normalized FFO $0.45 $0.25 $0.44 $0.44 $0.46 (1) See page 22 for a definition of FFO and Normalized FFO, a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) Incentive fees under our business management agreement with RMR LLC are payable after the end of each calendar year, are calculated based on common share total return, as defined, and are included in general and administrative expense in our consolidated statements of income. In calculating net income attributable to common shareholders in accordance with GAAP, we recognize estimated business management incentive fee expense, if any, in the first, second and third quarters. Although we recognize this expense, if any, in the first, second and third quarters for purposes of calculating net income attributable to common shareholders, we do not include these amounts in the calculation of Normalized FFO until the fourth quarter, when the amount of business management incentive fee expense for the calendar year, if any, is determined. Normalized FFO includes business management incentive fee expense of $55,740 for the three months ended December 31, 2017. Excluding business management incentive fee expense, Normalized FFO per share would have been $0.48 for the three months ended December 31, 2017. (3) Represents the unrealized gains and losses on equity securities, net, to adjust the carrying value of our investments to fair value in accordance with a change in GAAP standards effective January 1, 2018. 28

DEFINITIONS OF CERTAIN NON-GAAP FINANCIAL MEASURES NOI and Cash Basis NOI The calculations of NOI and Cash Basis NOI exclude certain components of net income in order to provide results that are more closely related to our property level results of operations. We calculate NOI and Cash Basis NOI as shown on page 19. We define NOI as income from our real estate less our property operating expenses. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions that we record as depreciation and amortization. We define Cash Basis NOI as NOI excluding non-cash straight line rent adjustments, lease value amortization, lease termination fee amortization, if any, and non-cash amortization included in property operating expenses. We consider NOI and Cash Basis NOI to be appropriate supplemental measures to net income because they may help both investors and management to understand the operations of our properties. We use NOI and Cash Basis NOI to evaluate individual and company wide property level performance, and we believe that NOI and Cash Basis NOI provide useful information to investors regarding our results of operations because these measures reflect only those income and expense items that are generated and incurred at the property level and may facilitate comparisons of our operating performance between periods and with other REITs. NOI and Cash Basis NOI do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income, net income attributable to common shareholders or operating income as indicators of our operating performance or as measures of our liquidity. These measures should be considered in conjunction with net income, net income attributable to common shareholders and operating income as presented in our condensed consolidated statements of income. Other real estate companies and REITs may calculate NOI and Cash Basis NOI differently than we do. EBITDA and Adjusted EBITDA We calculate EBITDA and Adjusted EBITDA as shown on page 20. We consider EBITDA and Adjusted EBITDA to be appropriate supplemental measures of our operating performance, along with net income, net income attributable to common shareholders and operating income. We believe that EBITDA and Adjusted EBITDA provide useful information to investors because by excluding the effects of certain historical amounts, such as interest, depreciation and amortization expense, EBITDA and Adjusted EBITDA may facilitate a comparison of current operating performance with our past operating performance. EBITDA and Adjusted EBITDA do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income, net income attributable to common shareholders or operating income as indicators of operating performance or as measures of our liquidity. These measures should be considered in conjunction with net income, net income attributable to common shareholders and operating income as presented in our condensed consolidated statements of income. Other real estate companies and REITs may calculate EBITDA and Adjusted EBITDA differently than we do. FFO and Normalized FFO We calculate FFO and Normalized FFO as shown on page 21. FFO is calculated on the basis defined by the National Association of Real Estate Investment Trusts, or Nareit, which is net income attributable to common shareholders, calculated in accordance with GAAP, excluding any gain or loss on sale of real estate and loss on impairment of real estate assets, if any, plus real estate depreciation and amortization and the difference between net income attributable to common shareholders and FFO attributable to noncontrolling interest, as well as certain other adjustments currently not applicable to us. Our calculation of Normalized FFO differs from Nareit's definition of FFO because we include business management incentive fees, if any, only in the fourth quarter versus the quarter when they are recognized as expense in accordance with GAAP due to their quarterly volatility not necessarily being indicative of our core operating performance and the uncertainty as to whether any such business management incentive fees will be payable when all contingencies for determining such fees are known at the end of the calendar year, and we exclude acquisition and certain other transaction related costs expensed under GAAP such as legal and professional fees associated with our acquisition and disposition activities, gains and losses on early extinguishment of debt, if any, unrealized gains and losses on equity securities, net, if any, and Normalized FFO from noncontrolling interest, net of FFO, if any. We consider FFO and Normalized FFO to be appropriate supplemental measures of operating performance for a REIT, along with net income, net income attributable to common shareholders and operating income. We believe that FFO and Normalized FFO provide useful information to investors, because by excluding the effects of certain historical amounts, such as depreciation and amortization expense, FFO and Normalized FFO may facilitate a comparison of our operating performance between periods and with other REITs. FFO and Normalized FFO are among the factors considered by our Board of Trustees when determining the amount of distributions to our shareholders. Other factors include, but are not limited to, requirements to maintain our qualification for taxation as a REIT, limitations in our revolving credit facility and term loan agreements and our public debt covenants, the availability to us of debt and equity capital, our expectation of our future capital requirements and operating performance and our expected needs for and availability of cash to pay our obligations. FFO and Normalized FFO do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income, net income attributable to common shareholders or operating income as indicators of our operating performance or as measures of our liquidity. These measures should be considered in conjunction with net income, net income attributable to common shareholders and operating income as presented in our condensed consolidated statements of income. Other real estate companies and REITs may calculate FFO and Normalized FFO differently than we do. 29