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NHP Reports Fourth Quarter and Full Year 2007 Earnings
Date:2/25/2008

- 2007 INVESTMENTS TOTAL $1.1 BILLION

- 2008 DIVIDEND INCREASED 7.3%

- ANNUAL REVENUES INCREASED 34.5%

- NORMALIZED ANNUAL FFO PER SHARE UP 7.8%

NEWPORT BEACH, Calif., Feb. 25 /PRNewswire-FirstCall/ -- Nationwide Health Properties, Inc. (NYSE: NHP) today announced its fourth quarter and full year 2007 operating results and investment activity.

"We ended 2007 on a strong note with fourth quarter revenues up 29.1% and normalized FFO per share up 12.5% over fourth quarter 2006 which enabled us to increase our quarterly per share dividend in January 2008 by $0.03, or $0.12 on an annual basis," commented Douglas M. Pasquale, NHP's President and Chief Executive Officer. "This has been a successful year for NHP, and the numbers clearly tell the tale. With $376 million of closed investments during the quarter bringing our total for the year to $1.1 billion, an increase in revenues for the year of 34.5%, an increase in normalized FFO per share of 7.8% and a $0.10 increase in the dividend over 2006, this was clearly a year of growth," Mr. Pasquale added.

2007 FOURTH QUARTER RESULTS

The following table presents selected financial results for the fourth quarter and full year 2007 as compared to the fourth quarter and full year 2006:

SELECTED FINANCIAL RESULTS

($ in thousands, except per share amounts)

Three Months Ended December 31,

Item 2007 2006 Change

Revenues $89,457 $69,291 $20,166 29.1%

Income from Continuing

Operations $41,935 $ble to common

stockholders $51,174 $98,966 $211,024 $170,414

Basic earnings per share (EPS):

Income from continuing operations

excluding gains $0.26 $0.18 $0.95 $0.64

Gains in income from continuing

operations 0.17 - 0.51 -

Income from continuing operations 0.43 0.18 1.46 0.64

Discontinued operations 0.12 0.98 0.87 1.56

Income available to common

stockholders $0.55 $1.16 $2.33 $2.20

Diluted EPS:

Income from continuing operations

excluding gains $0.25 $0.18 $0.95 $0.64

Gains in income from continuing

operations 0.17 - 0.50 -

Income from continuing operations 0.42 0.18 1.45 0.64

Discontinued operations 0.12 0.98 0.87 1.55

Income $0.54 $1.16 $2.32 $2.19

Weighted average shares outstanding

for EPS:

Basic 93,399 84,995 90,625 77,489

Diluted 93,990 85,392 91,129 77,879

Reconciliation of Net Income to Funds From Operations (FFO)

In thousands, except per share data

Three Months Ended Twelve Months Ended

December 31, December 31,

2007 2006 2007 2006

Net income to FFO

Net income $53,236 $102,757 $224,458 $185,577

Preferred stock dividends (2,062) (3,791) (13,434) (15,163)

Real estate related depreciation

and amortization 27,965 21,845 100,340 77,714

Depreciation in income from

unconsolidated joint venture 668 --- 1,703 ---

Gains on sale of facilities (26,880) (79,283) (118,114) (96,791)

FFO available to common

stockholders 52,927 41,528 194,953 151,337

Series B preferred dividend add-

back 2,062 2,062 8,250 8,250

Diluted FFO 54,989 43,590 203,203 159,587

Impairments --- --- --- 83

Non-recurring settlement of

delinquent tenant obligations (1,667) --- (3,632) ---

Recurring diluted FFO $53,322 $43,590 $199,571 $159,670

Weighted average shares outstanding

for FFO

Diluted weighted average shares

outstanding 93,990 85,392 91,129 77,879

Series B preferred stock add-back 4,717 4,693 4,707 4,688

Fully diluted weighted average

shares outstanding 98,707 90,085 95,836 82,567

Diluted per share amounts:

FFO $0.56 $0.48 $2.12 $1.93

Recurring FFO $0.54 $0.48 $2.08 $1.93

Dividends declared per common share $0.41 $0.39 $1.64 $1.54

Recurring FFO payout ratio 76% 81% 79% 80%

Recurring FFO Coverage 1.32 1.23 1.27 1.25

Reconciliation of 2008 Net Income

Guidance to 2008 Diluted FFO and

Diluted FAD Guidance

Low High

Net income $1.21 $1.26

Real estate related

depreciation and amortization 1.21 1.21

Less: gains on sale (0.23) (0.23)

Dilution from convertible

preferred stock (0.02) (0.02)

Diluted FFO guidance $2.17 $2.22

Straight-lined rent (0.11) (0.11)

Non-cash stock-based

compensation expense 0.05 0.05

Deferred finance cost

amortization 0.03 0.03

Lease commissions and tenant

and capital improvements (0.06) (0.07)

Diluted FAD guidance $2.08 $2.12

Consolidated Balance Sheets

In thousands

December 31, December 31,

2007 2006

Assets

Real estate related investments:

Land $301,100 $267,303

Buildings and improvements 2,896,876 2,581,484

3,197,976 2,848,787

Less accumulated depreciation (410,865) (372,201)

Net real estate 2,787,111 2,476,586

Mortgage loans receivable, net 121,694 106,929

Investment in unconsolidated

joint venture 52,637 ---

Net real estate related

investments 2,961,442 2,583,515

Cash and cash equivalents 19,407 14,695

Receivables, net 3,808 7,787

Assets held for sale --- 9,484

Other assets 159,696 89,333

Total assets $3,144,353 $2,704,814

Liabilities and Stockholders' Equity

Credit facility $41,000 $139,000

Senior notes due 2008 - 2038 1,166,500 887,500

Notes and bonds payable 340,150 355,411

Accounts payable and accrued

liabilities 107,844 77,829

Total liabilities 1,655,494 1,459,740

Minority interest 6,166 1,265

Stockholders' equity:

Series A preferred stock --- 90,049

Series B convertible preferred stock 106,445 106,450

Common stock 9,481 8,624

Capital in excess of par value 1,565,249 1,298,703

Cumulative net income 1,288,751 1,064,293

Accumulated other comprehensive

income 2,561 1,231

Cumulative dividends (1,489,794) (1,325,541)

Total stockholders' equity 1,482,693 1,243,809

Total liabilities and

stockholders' equity $3,144,353 $2,704,814

18,739 $23,196 123.8%

Net Income $53,236 $102,757 $(49,521) (48.2)%

Diluted Income from

Continuing

Operations Available to

Common $0.42 $0.18 $0.24 133.3%

Stockholders Per Share

Diluted Income Available to

Common Stockholders Per

Share $0.54 $1.16 $(0.62) (53.4)%

Diluted FFO $54,989 $43,590 $11,399 26.2%

Diluted FFO Per Share $0.56 $0.48 $0.08 16.7%

Normalized Diluted FFO $53,322 $43,590 $9,732 22.3%

Normalized Diluted FFO Per

Share $0.54 $0.48 $0.06 12.5%

Twelve Months Ended December 31,

Revenues $329,238 $244,856 $84,382 34.5%

Income from Continuing

Operations $145,969 $65,016 $80,953 124.5%

Net Income $224,458 $185,577 $38,881 21.0%

Diluted Income from

Continuing Operations

Available to Common

Stockholders Per Share $1.45 $0.64 $0.81 126.6%

Diluted Income Available to

Common Stockholders Per

Share $2.32 $2.19 $0.13 5.9%

Diluted FFO $203,203 $159,587 $43,616 27.3%

Diluted FFO Per Share $2.12 $1.93 $0.19 9.8%

Normalized Diluted FFO $199,571 $159,670 $39,901 25.0%

Normalized Diluted FFO Per

Share $2.08 $1.93 $0.15 7.8%

Funds From Operations (FFO)

FFO is a non-GAAP measure that NHP believes is important to an understanding of its operations. A reconciliation between net income, the most directly comparable GAAP financial measure, and FFO is included in the accompanying financial data. We believe FFO is an important supplemental measure of operating performance because it excludes the effects of depreciation and gains (losses) from sales of facilities (both of which are based on historical costs and which may be of limited relevance in evaluating current performance).

The fourth quarter normalized FFO amounts above exclude approximately $1.7 million ($0.02 per share) of previously reserved rent, interest and late charges recognized when paid during the fourth quarter of 2007 on a portfolio that was restructured during the quarter and the full year 2007 normalized FFO amounts include a total of approximately $3.6 million ($0.04 per share) of previously reserved rent, interest and late charges recognized when paid during the third and fourth quarters related to the above mentioned restructuring and one other in the third quarter.

These results also include gains on the sale of certain assets shown in the accompanying income statement that caused the income from continuing operations and net income results in 2007 to be significantly higher than in 2006. These gains totaled $16.1 million ($0.17 per share) in the fourth quarter of 2007 and $46.0 million ($0.50 per share) for the full year 2007. Income from continuing operations does not include the gains on sale or the operations of facilities sold that qualified as discontinued operations for any period presented in the accompanying income statement, however it does include the gains on sale and historical operations of facilities we sold to our unconsolidated joint venture.

NEW INVESTMENTS

The following tables summarize our fourth quarter and full year investment activity:

FOURTH QUARTER 2007 CLOSED INVESTMENTS

Unit

Type Amount Price Cap Initial CPI DARM

(millions) (thousands) Rate Yield Ups Cover

Senior Housing $50 $207 9.8% 7.6% 3.0% 1.6x

Long-Term Care $78 $128 10.8% 8.6% 3.0% 1.5x

Medical Office $248 $215/sf 6.5% 6.5%

Total $376

2007 CLOSED INVESTMENTS

Unit

Type Amount Price Cap Initial CPI DARM

(millions) (thousands) Rate Yield Ups Cover

Senior Housing $286 $105 8.9% 8.2% 2.8% 1.3x

CCRC $39 $74 11.1% 8.8% 2.5% 1.6x

Long-Term Care $362 $88 11.4% 8.5% 2.4% 1.8x

Medical Office $327 $204/sf 6.7% 6.7%

Subtotal $1,014

Loans $47 11.0%

Total $1,061

Included in these numbers are acquisitions from third parties financed through our unconsolidated joint venture which are broken out in our supplemental information package (but excluded are the 19 facilities acquired by the joint venture from us for $227 million during 2007). Approximately 75% of the acquired loans shown above had maturity dates in 2007 and 2008.

2007 FINANCING TRANSACTIONS

During 2007, we issued approximately 7.8 million common shares through our controlled equity offering program at an average price of $31.52 per share resulting in net proceeds of approximately $242.9 million.

On October 1, 2007, we redeemed all 900,485 shares of our Series A Cumulative Preferred Step-Up REIT Securities at their $100 per share redemption value for a total of $90,048,500. The final dividend on these shares was paid concurrently.

On October 19, 2007, we issued $300 million of 6.25% senior unsecured notes maturing on February 1, 2013, resulting in net proceeds of approximately $297 million after deducting underwriting discounts and other expenses. During the months of August and September, we hedged the treasury rate on $250 million of the notes resulting in a cash payment to us of $1.6 million that will reduce our interest expense over the life of the notes.

2008 GUIDANCE

We are initiating our full-year 2008 guidance at this time. For 2008 we will be providing guidance for both FFO and Funds Available for Distribution (FAD). Our diluted FFO per share range is from $2.17 to $2.22. Our diluted FAD per share range is from $2.08 to $2.12. This range includes the effects of the Pacific Medical Buildings transaction announced via a separate press release dated February 25, 2008 and the sale of the Emeritus portfolio mentioned therein. While we expect to continue to make accretive acquisitions during 2008, both our FFO and FAD guidance ranges are before any additional acquisitions, impairments or capital transactions. However, this guidance assumes mortgage loan receivable prepayments and expected dispositions during 2008 as described in our supplemental information package available on our website.

FAD is a non-GAAP measure that we believe is important to an understanding of our operations. We believe FAD is an important supplemental measure of operating performance because it excludes the effects of depreciation and gains (losses) from sales of facilities (both of which are based on historical costs and which may be of limited relevance in evaluating current performance) like FFO and it also excludes straight-lined rent and other non-cash items that have become more significant for NHP and our competitors over the last several years. A reconciliation between net income per share and FFO per share and a reconciliation between net income per share and FAD per share for the

guidance range is included in the accompanying financial data as we believe net income per share is the most directly comparable GAAP measure.

CONFERENCE CALL INFORMATION

The Company has scheduled a conference call and webcast on Tuesday, February 26, 2008 at 8:30 a.m. Pacific time in order to present the Company's performance and operating results for the quarter and year ended December 31, 2007. The conference call is accessible by dialing (877) 356-5705 and referencing conference ID number 34719103 or by logging on to our website at http://www.nhp-reit.com. The earnings release and any additional financial information that may be discussed on the conference call will also be available at the same location on our website. A digitized replay of the conference call will be available from 11:00 a.m. Pacific time that day until 9:00 p.m. Pacific time on Wednesday, March 12, 2008. Callers can access the replay by dialing (800) 642-1687 or (706) 645-9291 and entering conference ID number 34719103. Webcast replays will also be available on our website for at least 12 months following the conference call. The Company's supplemental information package for the fourth quarter and year ended December 31, 2007 is available on our website, free of charge, at http://www.nhp-reit.com by selecting financial information followed by analyst information and will also be included in our Current Report on Form 8-K filed February 25, 2008 with the SEC containing this release.

Nationwide Health Properties, Inc. is a real estate investment trust that invests in senior housing facilities, long-term care facilities and medical office buildings. The Company has investments in 567 facilities in 43 states. For more information on Nationwide Health Properties, Inc., visit our website at http://www.nhp-reit.com.

Certain information contained in this release includes forward-looking statements. Forward-looking statements include statements regarding our expectations, beliefs, intentions, plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements which are not statements of historical facts, including statements regarding the proposed transaction between NHP and Pacific Medical Buildings and the benefits of the proposed transaction. These statements may be identified, without limitation, by the use of forward-looking terminology such as "may," "will," "anticipates," "expects," "believes," "intends," "should" or comparable terms or the negative thereof. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those described in the statements. Risks and uncertainties associated with the PMB transaction include (without limitation) the following: delay or failure to obtain third party consents; the exclusion of certain properties (which may include properties described herein) from the transaction; uncertainty as to whether the transaction will be completed; the failure to achieve the perceived advantages from the transaction; larger than expected or unexpected costs associated with the transaction; unexpected liabilities resulting from the transaction; potential litigation associated with the transaction; and the retention of key personnel after the transaction. Other risks and uncertainties associated with our business, many of which will apply to the assets acquired in the PMB transaction, include (without limitation) the following: deterioration in the operating results or financial condition, including bankruptcies, of our tenants; non-payment or late payment of rent by our tenants; our reliance on two operators for a significant percentage of our revenues; occupancy levels at certain facilities; our level of indebtedness; changes in the ratings of our debt securities; access to the capital markets and the cost of capital; government regulations, including changes in the reimbursement levels under the Medicare and Medicaid programs; the general distress of the healthcare industry; increasing competition in our business sector; the effect of economic and market conditions and changes in interest rates; the amount and yield of any additional investments; our ability to meet acquisition goals; the ability of our operators to repay deferred rent or loans in future periods; the ability of our operators to obtain and maintain adequate liability and other insurance; our ability to attract new operators for certain facilities; our ability to sell certain facilities for their book value; our ability to retain key personnel; potential liability under environmental laws; the possibility that we could be required to repurchase some of our medium-term notes; the rights and influence of holders of our outstanding preferred stock; changes in or inadvertent violations of tax laws and regulations and other factors that can affect real estate investment trusts and our status as a real estate investment trust; and other factors discussed from time to time in our news releases, public statements and/or filings with the Securities and Exchange Commission, especially the "Risk Factors" sections of our Annual and Quarterly Reports on Forms 10-K and 10-Q. Forward-looking information is provided by NHP pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995 and should be evaluated in the context of these factors. We disclaim any intent or obligation to update these forward-looking statements.

CONTACT: Abdo H. Khoury

Chief Financial and Portfolio Officer

(949) 718-4400

Consolidated Statements of Operations

In thousands, except per share data

Three Months Ended Twelve Months Ended

December 31, December 31,

2007 2006 2007 2006

Revenues:

Triple net lease rent $76,492 $62,971 $291,315 $221,797

Medical office building operating

rent 6,928 2,798 16,061 9,700

83,420 65,769 307,376 231,497

Interest and other income 6,037 3,522 21,862 13,359

89,457 69,291 329,238 244,856

Expenses:

Interest and amortization of

deferred financing costs 26,448 24,416 101,703 89,692

Depreciation and amortization 27,505 20,186 96,730 68,771

General and administrative 6,937 3,838 24,429 15,656

Medical office building operating

expenses 3,519 2,247 8,622 6,142

64,409 50,687 231,484 180,261

Income before minority interest and

unconsolidated joint venture 25,048 18,604 97,754 64,595

Minority interest in net loss of

consolidated joint ventures 73 135 212 421

Income from unconsolidated joint

venture 717 --- 1,958 ---

Gain on sale of facilities to

joint venture 16,097 --- 46,045 ---

Income from continuing operations 41,935 18,739 145,969 65,016

Discontinued operations

Gain on sale of facilities, net 10,783 79,283 72,069 96,791

Income (loss) from discontinued

operations 518 4,735 6,420 23,770

11,301 84,018 78,489 120,561

Net income 53,236 102,757 224,458 185,577

Preferred stock dividends (2,062) (3,791) (13,434) (15,163)

Income availa
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SOURCE Nationwide Health Properties, Inc.
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