Registration No. 333-120917

Prospectus Supplement

(To Prospectus Dated May 24, 2005)

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.

The public offering price set forth above does not include accrued interest, if any. Interest on the notes will accrue from December 2, 2005.

The underwriters expect to deliver the notes in book-entry form through the facilities of The Depository Trust Company on or about December 2, 2005, against payment therefor in immediately available funds.

Joint Bookrunning Managers

Banc of America Securities LLC

Co-Managers

A.G. Edwards

Raymond James          

The date of this prospectus supplement is November 29, 2005.

RISK FACTORS RELATED TO OUR NOTES

      An investment in the notes involves risks. You should carefully consider the following risk factors, together with all of the other information included in this prospectus supplement and the accompanying prospectus or incorporated by reference into the accompanying prospectus, in evaluating an investment in the notes.

      The notes are obligations only of Health Care REIT, Inc. and will not be guaranteed by our subsidiaries or secured by any of our or their properties or assets. Our subsidiaries, which own approximately 53% of our real estate investments, are separate legal entities and have no obligation to pay any amounts due pursuant to the notes. Certain of our subsidiaries are obligated under outstanding debt that may exist from time to time under certain of our credit facilities. See “Description of Other Indebtedness — Credit Facilities.”

      We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will enable us to pay our indebtedness, including these notes.

      We do not intend to apply for listing of the notes on any securities exchange or for quotation on the Nasdaq system. A market for the notes may not develop, or if one does, it may not necessarily be sustained. The marketability of the notes will depend on the number of holders, the market for notes of other issuers, our performance and interest rates.

      Other important risk factors are identified under the heading “Forward-Looking Statements and Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2004. The Annual Report on Form 10-K for the year ended December 31, 2004 is incorporated by reference into the accompanying prospectus. This prospectus supplement, the accompanying prospectus and the documents incorporated by reference do not describe all of the risks involved in an investment in the notes or the risks relating to our business. You should consult your own financial and legal advisors before investing in the notes.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

AND OTHER RISK FACTORS

      This prospectus supplement, the accompanying prospectus and the documents incorporated by reference into the accompanying prospectus contain “forward-looking statements” as that term is defined under federal securities laws. These forward-looking statements include those regarding:

      For example, when we use words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “estimate” or similar expressions, we are making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Our expected results may not be achieved, and actual results may differ materially from our expectations. This may be a result of various factors, including, but not limited to:

      Other important factors are identified in our Annual Report on Form 10-K for the year ended December 31, 2004, which is incorporated by reference into the accompanying prospectus, including factors identified under the headings “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” We assume no obligation to update or revise any forward-looking statements or to update the reasons why actual results could differ from those projected in any forward-looking statements.

THE COMPANY

      Health Care REIT, Inc., a Delaware corporation, is a self-administered, equity real estate investment trust that invests in health care and senior housing properties. Founded in 1970, we were the first real estate investment trust to invest exclusively in health care facilities.

      As of September 30, 2005, long-term care facilities, which include skilled nursing and assisted living facilities, comprised approximately 92% of our investment portfolio. As of September 30, 2005, we had approximately $2.6 billion in net real estate investments, inclusive of credit enhancements, in 426 facilities located in 37 states and managed by 52 different operators. At that date, the portfolio included 233 assisted living facilities, 180 skilled nursing facilities and 13 specialty care facilities.

      We seek to increase funds from operations and funds available for distribution and to enhance stockholder value through relationship investing with public and private regionally focused health care operators. The primary components of this strategy are set forth below.

      Relationship Investing. We establish relationships with, and provide financing to, operators throughout their growth cycles. We target companies with experienced management teams, regionally focused operations, substantial inside ownership interests or venture capital backing and significant growth potential.

      By maintaining close ties to operators, we are able to structure investments designed to support an operator’s business plan and monitor our investments on an ongoing basis. Features typically include a master operating lease for the acquisition and development of facilities in a geographic region. Economic terms typically include annual rate increases and fair market value-based purchase options.

      Portfolio Management. Portfolio strength is derived from diversity by operator, property sector and geographic location. We emphasize long-term investment structures that result in a predictable asset base with attendant recurring income and funds from operations. Generally, master leases have a ten to 15 year term and mortgage loans provide five to seven years of prepayment protection. We also regularly monitor the portfolio with our proprietary database system.

      Depth of Management. Our management team is comprised of eight individuals who have an aggregate of approximately 150 years of experience in health care and real estate finance. The management team has successfully implemented our investment strategy of emphasizing relationship financings with strong, emerging operators.

The Portfolio

      The following table summarizes our portfolio as of September 30, 2005:

     In determining whether to invest in a facility, we focus on the following: (a) the experience of the tenant’s or borrower’s management team; (b) the historical and projected financial and operational performance of the facility; (c) the credit of the tenant or borrower; (d) the security for the lease or loan; and (e) the capital committed to the facility by the tenant or borrower. We conduct market research and analysis for all potential investments. In addition, we review the value of all facilities, the interest rates and debt service coverage requirements of any debt to be assumed and the anticipated sources of repayment of any debt.

      We monitor our investments through a variety of methods determined by the type of facility and operator. Our monitoring process includes review of monthly financial statements and other operating data for each facility, quarterly review of operator creditworthiness, periodic facility inspections and review of covenant compliance relating to licensure, real estate taxes, letters of credit and other collateral. In monitoring our portfolio, our personnel use a proprietary database to collect and analyze facility-specific data. Additionally, we conduct extensive research to ascertain industry trends and risks.

      Our investments are primarily operating leases and mortgage loans. Construction financing is provided, but only as part of a long-term operating lease or mortgage loan. Substantially all of our investments are designed with escalating rate structures. Depending upon market conditions, we believe that appropriate new investments will be available in the future with spreads over our cost of capital that will generate appropriate returns to our stockholders. Operating leases and mortgage loans are normally credit enhanced by guaranties and/or letters of credit. In addition, operating leases are typically structured as master leases and mortgage loans are generally cross-defaulted and cross-collateralized with other mortgage loans, operating leases or agreements between us and the operator and its affiliates.

Additional Information

      For additional information regarding our business, please see the information under the heading “Business” in our Annual Report on Form 10-K for the year ended December 31, 2004, which is incorporated by reference into the accompanying prospectus.

RATIO OF EARNINGS TO FIXED CHARGES

      The following table sets forth our ratio of earnings to fixed charges for the periods indicated. The ratio of earnings to fixed charges was computed by dividing earnings by our fixed charges. For purposes of calculating these ratios, “earnings” includes income from continuing operations before extraordinary items, excluding the equity earnings in a less than 50% owned subsidiary, plus fixed charges and reduced by capitalized interest. “Fixed charges” consists of interest on all indebtedness and the amortization of loan expenses or interest expensed and capitalized and the amortized premiums, discounts and capitalized expenses related to indebtedness.

USE OF PROCEEDS

      The net proceeds from the sale of the notes are estimated to be $296,600,000 after deducting underwriting discounts and commissions and other offering expenses. We intend to use the net proceeds to invest in additional properties. Pending such use, we intend to use the net proceeds primarily to repay borrowings under our unsecured lines of credit arrangements. As of November 25, 2005, we had an outstanding balance of $184,000,000 under our unsecured lines of credit arrangements bearing interest at an average rate of 5.03%. Affiliates of certain of the underwriters who are lenders under our unsecured lines of credit arrangements would receive some of the funds used to repay such borrowings. See “Underwriting.” To the extent that net proceeds exceed such borrowings, the net proceeds may be invested in short-term, investment grade, interest-bearing securities, certificates of deposit or direct or guaranteed obligations of the United States.

CAPITALIZATION

      The following table sets forth our capitalization as of September 30, 2005, as adjusted to give effect to the issuance of 3,000,000 shares of common stock in November 2005 and as further adjusted to give effect to the sale of the notes offered by this prospectus supplement.

     You should read this table in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements, related notes and other financial information that we have incorporated by reference into the accompanying prospectus.

SELECTED FINANCIAL INFORMATION

      The following selected financial data for the five years ended December 31, 2004 are derived from our audited consolidated financial statements. The financial data for the nine month periods ended September 30, 2005 and September 30, 2004 are derived from our unaudited financial statements. The unaudited financial statements include all adjustments, consisting of normal recurring accruals, which we consider necessary for a fair presentation of our financial position and results of operation for these periods. Operating results for the nine months ended September 30, 2005 are not necessarily indicative of the results that may be expected for the entire year ending December 31, 2005. The data should be read in conjunction with our consolidated financial statements, related notes and other financial information incorporated by reference herein. Amounts are in thousands, expect per share data.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

      You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and related notes for the periods presented which are incorporated by reference into the accompanying prospectus. Some of the information contained in this discussion and analysis or set forth elsewhere in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference includes forward-looking statements that involve risks and uncertainties. You should review the “Risk Factors Related to Our Notes” and “Cautionary Statement Concerning Forward-Looking Statements and Other Risk Factors” sections of this prospectus supplement and the other risk factors incorporated by reference into the accompanying prospectus for a discussion of the important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Executive Overview

  Business

      Health Care REIT, Inc. is a self-administered, equity real estate investment trust that invests in health care and senior housing properties. Founded in 1970, we were the first REIT to invest exclusively in health care facilities. As of September 30, 2005, long-term care facilities, which include skilled nursing and assisted living facilities, comprised approximately 92% of our investment portfolio. The following table summarizes our portfolio as of September 30, 2005:

     Our primary objectives are to protect stockholders’ capital and enhance stockholder value. We seek to pay consistent cash dividends to stockholders and create opportunities to increase dividend payments to stockholders as a result of annual increases in rental and interest income and portfolio growth. To meet these objectives, we invest primarily in properties managed by experienced operators and diversify our investment portfolio by operator and geographic location.

      Substantially all of our revenues and sources of cash flows from operations are derived from operating lease rentals and interest earned on outstanding loans receivable. These items represent our primary source of liquidity to fund distributions and are dependent upon our operators’ continued ability to make contractual rent and interest payments to us. To the extent that our operators experience operating difficulties and are unable to generate sufficient cash to make payments to us, there could be a material adverse impact on our consolidated results of operations, liquidity and/or financial condition. To mitigate this risk, we monitor our investments through a variety of methods determined by the type of facility and operator. Our monitoring process includes review of monthly financial statements for each facility, quarterly review of operator credit, periodic facility inspections and review of covenant compliance relating to licensure, real estate taxes, letters of credit and other collateral. In monitoring our portfolio, our personnel use a proprietary database to collect and analyze facility-specific data. Additionally, we conduct extensive research to ascertain industry trends and risks. Through these monitoring and research efforts, we are typically able to intervene at an early stage and address payment risk, and in so doing, support both the collectibility of revenue and the value of our investment.

      In addition to our monitoring and research efforts, we also structure our investments to help mitigate payment risk. We typically invest in or finance up to 90% of the appraised value of a property. Operating leases and loans are normally credit enhanced by guaranties and/ or letters of credit. In addition, operating leases are typically structured as master leases and loans are generally cross-defaulted and cross-collateralized with other loans, operating leases or agreements between us and the operator and its affiliates. As of September 30, 2005, 85% of our real property was subject to master leases, 97% of our real estate investments were cross-defaulted with other investments relating to the same operator and 86% of our real property loans were cross-collateralized with other loans to the same operator.

      For the nine months ended September 30, 2005, rental income and interest income represented 92% and 7%, respectively, of total gross revenues (including revenues from discontinued operations). Prior to June 2004, our standard lease structure contained fixed annual rental escalators, which were generally recognized on a straight-line basis over the initial lease period. Beginning in June 2004, our new standard lease structure contains annual rental escalators that are contingent upon changes in the Consumer Price Index and/ or changes in the gross operating revenues of the property. Since these escalators are not fixed, straight-line rent is not recorded. Instead, rental income is recorded based on the contractual cash rental payments due for the period. This lease structure will initially generate lower revenues, net income and funds from operations compared to leases with fixed escalators that require straight-lining, but will enable us to generate additional organic growth and minimize non-cash straight-line rent over time. This change does not affect our cash flow or our ability to pay dividends. Our yield on loans receivable depends upon a number of factors, including the stated interest rate, the average principal amount outstanding during the term of the loan and any interest rate adjustments.

      Depending upon market conditions, we believe that new investments will be available in the future with spreads over our cost of capital that will generate appropriate returns to our stockholders. During the nine months ended September 30, 2005, we completed $267,849,000 of gross new investments and had $42,545,000 of investment payoffs, resulting in net investments of $225,304,000. We refined 2005 net investment guidance to a range of $125,000,000 to $175,000,000 from the previous guidance of $100,000,000 to $200,000,000. We anticipate the sale of additional real property and the repayment of loans receivable totaling approximately $100,000,000 in the first quarter of 2006. It is possible that additional loan repayments or sale of real property may occur in the future. To the extent that loan repayments and real property sales exceed new investments, our revenues and cash flows from operations could be adversely affected. We expect to reinvest the proceeds from any loan repayments and real property sales in new investments. To the extent that new investment requirements exceed our available cash on hand, we expect to borrow under our unsecured lines of credit arrangements. At September 30, 2005, we had $27,119,000 of cash and cash equivalents and $236,000,000 of available borrowing capacity under our unsecured lines of credit arrangements.

  Key Transactions in 2005

      We have completed the following key transactions during 2005:

  Key Performance Indicators, Trends and Uncertainties

      We utilize several key performance indicators to evaluate the various aspects of our business. These indicators are discussed below and relate to operating performance, concentration risk and credit strength. Management uses these key performance indicators to facilitate internal and external comparisons to our historical operating results, in making operating decisions and for budget planning purposes.

      Operating Performance. We believe that net income available to common stockholders (“NICS”) is the most appropriate earnings measure. Other useful supplemental measures of our operating performance include funds from operations (“FFO”) and funds available for distribution (“FAD”); however, these supplemental measures are not defined by U.S. generally accepted accounting principles (“U.S. GAAP”). Please refer to the section entitled “Non-GAAP Financial Measures” for further discussion of FFO and FAD and for reconciliations of FFO and FAD to NICS. NICS, FFO, FAD and their relative per share amounts are widely used by investors and analysts in the valuation, comparison and investment recommendations of companies. The following table reflects the recent historical trends for our operating performance measures (dollars in thousands, except per share data):

      Concentration Risk. We evaluate our concentration risk in terms of asset mix, investment mix, operator mix and geographic mix. Concentration risk is a valuable measure in understanding what portion of our investments could be at risk if certain sectors were to experience downturns. Asset mix measures the portion of our investments that are real property. In order to qualify as an equity REIT, at least 75% of our real estate investments must be real property, including the land, buildings, improvements and related rights, which is owned by us and leased to an operator pursuant to a long-term operating lease. Investment mix measures the portion of our investments that relate to our various facility types. We invest primarily in long-term care facilities. Operator mix measures the portion of our investments that relate to our top five operators. We attempt to limit our top five operators to 50% of our total real estate investments. Geographic mix measures the portion of our investments that relate to our top five

      Credit Strength. We measure our credit strength both in terms of leverage ratios and coverage ratios. Our leverage ratios include debt to book capitalization (“DBCR”) and debt to market capitalization (“DMCR”). The leverage ratios indicate how much of our balance sheet capitalization is related to long-term debt. We expect to maintain a DBCR between 40% and 50% and a DMCR between 30% and 40%. Our coverage ratios include interest coverage ratio (“ICR”) and fixed charge coverage ratio (“FCR”). The coverage ratios indicate our ability to service interest and fixed charges (interest plus preferred dividends). We expect to maintain an ICR in excess of 3.00 times and an FCR in excess of 2.50 times. The coverage ratios are based on earnings before interest, taxes, depreciation and amortization (“EBITDA”) which is discussed in further detail, and reconciled to net income, below in “Non-GAAP Financial Measures.” Leverage ratios and coverage ratios are widely used by investors, analysts and rating agencies in the

      We evaluate our key performance indicators in conjunction with current expectations to determine if historical trends are indicative of future results. Our expected results may not be achieved and actual results may differ materially from our expectations. Factors that may cause actual results to differ from expected results are described in more detail in “Risk Factors Related to Our Notes” and “Cautionary Statement Concerning Forward-Looking Statements and Other Risk Factors” and other sections of this prospectus supplement and the accompanying prospectus. Management regularly monitors economic and other factors to develop strategic and tactical plans designed to improve performance and maximize our competitive position. Our ability to achieve our financial objectives is dependent upon our ability to effectively execute these plans and to appropriately respond to emerging economic and company-specific trends. Please refer to our Annual Report on Form 10-K for the year ended December 31, 2004, under the headings “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further discussion of these risk factors.

  Portfolio Update

      Payment coverages in our portfolio continue to improve. Our overall stable payment coverage is at 1.91 times and represents an increase of one basis point from the prior quarter. The table below is a summary of the key performance measures for our portfolio. Census and payor mix data reflects the three months ended June 30, 2005. Coverage data reflects the 12 months ended June 30, 2005.

      Assisted Living Portfolio. At September 30, 2005, our assisted living portfolio was comprised of 233 facilities with 15,639 units and an investment balance of $1,325,489,000. The stabilized portfolio was comprised of 230 facilities with 15,370 units, an investment balance of $1,300,783,000, and payment coverage of 1.51 times, an increase of two basis points from the prior quarter. Our fill-up and construction properties remained within our stated goal of having no more than 10% to 15% of the portfolio in construction and fill-up.

      Skilled Nursing Portfolio. At September 30, 2005, our skilled nursing portfolio was comprised of 180 facilities with 24,626 beds and an investment balance of $1,093,750,000. Average occupancies have risen from a low of 81% in the third quarter of 2000 to 86% in the

      Specialty Care Portfolio. At September 30, 2005, our specialty care portfolio was comprised of 13 facilities with 1,267 beds and an investment balance of $205,660,000. Our stable payment coverage remains strong at 3.53 times, an increase of seven basis points from the prior quarter.

  Corporate Governance

      Maintaining investor confidence and trust has become increasingly important in today’s business environment. Health Care REIT, Inc.’s Board of Directors and management are strongly committed to policies and procedures that reflect the highest level of ethical business practices. Our corporate governance guidelines provide the framework for our business operations and emphasize our commitment to increase stockholder value while meeting all applicable legal requirements. These guidelines meet the listing standards adopted by the New York Stock Exchange and are available on our Web site at www.hcreit.com and from us upon written request sent to the Vice President — Administration and Corporate Secretary, Health Care REIT, Inc., One SeaGate, Suite 1500, P.O. Box 1475, Toledo, Ohio, 43603-1475.

      On July 30, 2002, President George W. Bush signed into law the Sarbanes-Oxley Act of 2002 (“SOX”). SOX is designed to protect investors by improving the accuracy and reliability of corporate disclosures. SOX directed the Securities and Exchange Commission (“SEC”) to promulgate all necessary rules and regulations. We believe we are in compliance with the applicable provisions of SOX and the rules of the SEC adopted under SOX as well as the listing guidelines of the NYSE relating to corporate governance. Beginning with the Annual Report on Form 10-K for the year ended December 31, 2004, we have provided the required annual report on management’s assessment of the effectiveness of the Company’s internal control over financial reporting. To date, we have incurred costs (both internal and external) related to SOX Section 404 (Management Assessment of Internal Controls) and other corporate governance compliance initiatives and we anticipate that we will incur additional costs. These costs are included in general and administrative expenses.

Liquidity and Capital Resources

  Sources and Uses of Cash

      Our primary sources of cash include rent and interest receipts, borrowings under unsecured lines of credit arrangements, public and private offerings of debt and equity securities, proceeds from the sales of real property and principal payments on loans receivable. Our primary uses of cash include dividend distributions, debt service payments (including principal and interest), real property acquisitions, loan advances and general and administrative expenses. These sources and uses of cash are reflected in our Consolidated Statements of Cash Flows and are discussed

      Operating Activities. The increase in net cash provided from operating activities is primarily attributable to changes in receivables and accrued expenses and a decrease in rental income in excess of cash received. Changes in receivables are primarily due to timing of cash receipts of rent and interest from our operators. Changes in accrued expenses are primarily attributable to timing of cash disbursements for our contractual interest obligations. The decrease in rental income in excess of cash received is due primarily to an increase in cash payments outside normal monthly rental payments in 2005. In addition, as discussed above, prior to June 2004, our standard lease structure contained fixed annual rental escalators, which were generally recognized on a straight-line basis over the initial lease period. Beginning in June 2004, our new standard lease structure contains annual rental escalators that are contingent upon changes in the Consumer Price Index and/or changes in the gross operating revenues of the property. Since these escalators are not fixed, no straight-line rent is recorded. Instead, rental income is recorded based on the contractual cash rental payments due for the period.

      Investing Activities. The decrease in net cash used in investing activities is primarily attributable to an increase in real property investments. At September 30, 2005, 91% of our real estate investments were real property investments. The investment activity during the nine months ended September 30, 2005 was approximately 93% real property investments. Investments for the nine months ended September 30, 2005 included the acquisition of four assisted living facilities, 27 skilled nursing facilities and five specialty care facilities for $224,841,000. These acquisitions included the assumption of debt totaling $22,309,000, resulting in $202,532,000 of cash disbursed for the acquisitions. The remaining $23,552,000 of real property investments relates primarily to funding of construction and renovations on existing facilities. Of this amount, $4,782,000 related to construction advances on three assisted living facilities. For the same period in 2004, we acquired 21 assisted living facilities and 35 skilled nursing facilities for $400,731,000. The prior year acquisitions included no assumption of debt. In addition, we advanced $31,192,000 relating to construction and renovations on existing facilities. Of this amount, $9,324,000 related to construction advances on three assisted living facilities.

      Financing Activities. The change in net cash provided from or used in financing activities is primarily attributable to changes related to our long-term debt and cash distributions to stockholders. For the nine months ended September 30, 2005, we had a net increase of $153,000,000 on our unsecured lines of credit arrangements as compared to an $80,000,000 net increase for the same period in 2004. This was partially offset by an increase in our principal payments on secured debt which was primarily due to the payoff of $6,168,000 of mortgages in

      In April 2005, we closed on a public offering of $250,000,000 of 5.875% senior unsecured notes due May 2015 at an effective yield of 5.913%. In May 2005, we redeemed all of our outstanding $50,000,000 8.17% senior unsecured notes due March 2006, completed a tender offer for $57,670,000 of our outstanding $100,000,000 7.625% senior unsecured notes due March 2008 and redeemed $122,500,000 of our outstanding $175,000,000 7.5% senior unsecured notes due August 2007. We recognized one-time charges on the extinguishment of debt totaling approximately $18,448,000 in the second quarter of 2005 as a result of this activity.

      On September 14, 2004, we closed on a public offering of 7,000,000 shares of 7.625% Series F Cumulative Redeemable Preferred Stock, which generated net proceeds of approximately $169,372,000. The shares have a liquidation value of $25 per share. The preferred stock, which has no stated maturity, may be redeemed by us at par on or after September 14, 2009. The proceeds were used to repay borrowings under our unsecured lines of credit arrangements and to invest in additional health care properties.

      In order to qualify as a REIT for federal income tax purposes, we must distribute at least 90% of our taxable income (excluding capital gains) to our stockholders. During the nine months ended September 30, 2005, we paid dividends totaling $98,586,000 (or $1.84 per share) and $16,261,000 to holders of our common stock and preferred stock, respectively. For the same period in 2004, we paid dividends totaling $91,461,000 (or $1.785 per share) and $7,295,000 to holders of our common stock and preferred stock, respectively. The increase in common stock dividends is attributable to the increase in common stock outstanding, primarily as a result of common stock issuances pursuant to our DRIP, issuances pursuant to stock option exercises and restricted stock grants, and conversions of preferred stock into common stock. The increase in preferred dividends is primarily due to the issuance of 7,000,000 shares of 7.625% Series F Cumulative Redeemable Preferred Stock in September 2004.

  Off-Balance Sheet Arrangements

      We have an outstanding letter of credit issued for the benefit of certain insurance companies that provide workers’ compensation insurance to one of our tenants. Our obligation under the letter of credit matures in 2009. At September 30, 2005, our obligation under the letter of credit was $2,450,000.

      We are exposed to various market risks, including the potential loss arising from adverse changes in interest rates. We may or may not elect to use financial derivative instruments to hedge interest rate exposure. These decisions are principally based on our policy to match our variable rate investments with comparable borrowings, but are also based on the general trend in interest rates at the applicable dates and our perception of the future volatility of interest rates. As of September 30, 2005, we participated in two interest rate swap agreements related to our long-term debt. Our interest rate swaps are discussed below in “Contractual Obligations” and “Results of Operations.”

      The following table summarizes our payment requirements under contractual obligations as of September 30, 2005 (in thousands):

     We have an unsecured credit arrangement with a consortium of ten banks providing for a revolving line of credit (“revolving credit”) in the amount of $500,000,000, which expires on June 22, 2008 (with the ability to extend for one year at our discretion if we are in compliance with all covenants). The agreement specifies that borrowings under the revolving credit are subject to interest payable in periods no longer than three months at either the agent bank’s prime rate of interest or the applicable margin over LIBOR interest rate, at our option (4.832% at September 30, 2005). The applicable margin is based on our ratings with Moody’s Investors Service and Standard & Poor’s Ratings Services and is currently 0.9%. In addition, we pay a facility fee annually to each bank based on the bank’s commitment under the revolving credit facility. The facility fee depends upon our ratings with Moody’s and Standard & Poor’s and is currently 0.225% of each bank’s commitment. We also pay an annual agent’s fee of $50,000. Principal is due upon expiration of the agreement. We have another unsecured line of credit arrangement with one bank for a total of $40,000,000, which expires May 31, 2006. Borrowings under this line of credit are subject to interest at either the bank’s prime rate of interest (6.75% at September 30, 2005) or 1.3% plus the applicable LIBOR interest rate, at our option. Principal is due upon expiration of the agreement. At September 30, 2005, we had $304,000,000 outstanding under the unsecured lines of credit arrangements and estimated total contractual interest obligations of $38,367,000. Contractual interest obligations are estimated based on the assumption that the balance of $304,000,000 at September 30, 2005 is constant until maturity at interest rates in effect at September 30, 2005.

      At September 30, 2005, we had $894,830,000 of senior unsecured notes outstanding with fixed annual interest rates ranging from 5.875% to 8.0%, payable semi-annually. Total contractual interest obligations on senior unsecured notes totaled $646,983,000 at September 30, 2005. Additionally, we have 31 mortgage loans totaling $174,324,000, collateralized by health care facilities, with fixed annual interest rates ranging from 5.8% to 8.5%, payable monthly. The carrying values of the health care properties securing the mortgage loans totaled $245,968,000 at September 30, 2005. Total contractual interest obligations on mortgage loans totaled $130,803,000 at September 30, 2005.

      At September 30, 2005, we had operating lease obligations of $14,702,000 relating to our office space, six assisted living facilities and three skilled nursing facilities.

      Purchase obligations are comprised of unfunded construction commitments and contingent purchase obligations. At September 30, 2005, we had outstanding construction financings of $1,135,000 for leased properties and were committed to providing additional financing of approximately $1,060,000 to complete construction. At September 30, 2005, we had contingent purchase obligations totaling $46,620,000. These contingent purchase obligations primarily relate to deferred acquisition fundings. Deferred acquisition fundings are contingent upon a tenant satisfying certain conditions in the lease. Upon funding, amounts due from the tenant for rent are increased to reflect the additional investment in the property.

  Capital Structure

      As of September 30, 2005, we had stockholders’ equity of $1,319,696,000 and a total outstanding debt balance of $1,373,154,000, which represents a debt to total book capitalization ratio of 51%. Our ratio of debt to market capitalization was 37% at September 30, 2005. For the nine months ended September 30, 2005, our coverage ratio of EBITDA to interest was 2.96 to 1.00 and our coverage ratio of EBITDA to fixed charges was 2.34 to 1.00. Also, at September 30, 2005, we had $27,119,000 of cash and cash equivalents and $236,000,000 of available borrowing capacity under our unsecured lines of credit arrangements.

      Our debt agreements contain various covenants, restrictions and events of default. Among other things, these provisions require us to maintain certain financial ratios and minimum net worth and impose certain limits on our ability to incur indebtedness, create liens and make investments or acquisitions. As of September 30, 2005, we were in compliance with all of the covenants under our debt agreements. None of our debt agreements contain provisions for acceleration that could be triggered by our debt ratings. However, under our unsecured lines of credit arrangements, the ratings on our senior unsecured notes are used to determine the fees and interest payable.

      Our senior unsecured notes are rated Baa3 (stable), BBB-(stable) and BBB-(stable) by Moody’s Investors Service, Standard & Poor’s Ratings Services and Fitch Ratings, respectively. We plan to manage the Company to maintain investment grade status with a capital structure consistent with our current profile. Any downgrades in terms of ratings or outlook by any or all of the noted rating agencies could have a material adverse impact on our cost and availability of capital, which could in turn have a material adverse impact on our consolidated results of operations, liquidity and/or financial condition.

      As of November 25, 2005, we had an effective shelf registration statement on file with the SEC under which we may issue up to $729,344,619 of securities including debt securities, common and preferred stock, depositary shares, warrants and units. Also, as of November 25, 2005, we had an effective registration statement on file in connection with our enhanced DRIP program under which we may issue up to 6,314,213 shares of common stock. As of November 25, 2005, 3,192,822 shares of common stock remained available for issuance under this registration statement. Depending upon market conditions, we anticipate issuing securities

Results of Operations

      Net income available to common stockholders for the three months ended September 30, 2005 totaled $19,908,000, or $0.37 per diluted share, as compared with $19,004,000, or $0.37 per diluted share, for the same period in 2004. Net income available to common stockholders for the nine months ended September 30, 2005 totaled $36,105,000, or $0.67 per diluted share, as compared with $56,866,000, or $1.10 per diluted share, for the same period in 2004. Net income available to common stockholders decreased on a year-to-date basis from the prior year primarily due to the loss on extinguishment of debt totaling $18,448,000, or $0.34 per diluted share in the second quarter of 2005. This charge is discussed in further detail below.

      FFO for the three months ended September 30, 2005 totaled $41,975,000, or $0.77 per diluted share, as compared with $37,893,000, or $0.73 per diluted share, for the same period in 2004. FAD for the three months ended September 30, 2005 totaled $41,857,000, or $0.77 per diluted share, as compared to $34,891,000, or $0.67 per diluted share, for the same period in 2004. The increase in third quarter FFO is due primarily to an increase in rental income (including discontinued operations) offset by an increase in interest expense (including discontinued operations) and preferred stock dividends. The increase in third quarter FAD is primarily due to the items noted above for FFO and a decrease in rental income in excess of cash received. FFO for the nine months ended September 30, 2005 totaled $99,712,000, or $1.85 per diluted share, as compared with $109,442,000, or $2.11 per diluted share, for the same period in 2004. FAD for the nine months ended September 30, 2005 totaled $95,563,000, or $1.77 per diluted share, as compared to $97,307,000, or $1.88 per diluted share, for the same period in 2004. The decrease in year-to-date FFO is due primarily to an increase in rental income (including discontinued operations) offset by a decrease in interest income, the loss on extinguishment of debt and increases in interest expense (including discontinued operations), preferred stock dividends and general and administrative expenses. The decrease in year-to-date FAD is primarily due to the items noted above for FFO and a decrease in rental income in excess of cash received. These items are discussed in further detail below. Please refer to the discussion of “Non-GAAP Financial Measures” below for further information regarding FFO and FAD and for reconciliations of FFO and FAD to NICS.

      EBITDA for the three months ended September 30, 2005 totaled $70,211,000, as compared with $60,167,000 for the same period in 2004. EBITDA for the nine months ended September 30, 2005 totaled $182,887,000, as compared with $176,400,000 for the same period in 2004. Our coverage ratio of EBITDA to total interest was 2.96 times for the nine months ended September 30, 2005 as compared with 3.24 times for the same period in 2004. Our coverage ratio of EBITDA to fixed charges was 2.34 times for the nine months ended September 30, 2005 as compared with 2.86 times for the same period in 2004. The increase in third quarter EBITDA is primarily due to the increase in rental income (including discontinued operations). The increase in year-to-date EBITDA is primarily due to an increase in rental income (including discontinued operations) offset by a decrease in interest income, the loss on extinguishment of debt and an increase in general and administrative expenses. The decrease in our interest coverage ratio is primarily due to the loss on extinguishment of debt. The decrease in our fixed charge coverage ratio is primarily due to the loss on extinguishment of debt and an increase in preferred stock dividends. These items are discussed in further detail below. Please refer to the discussion of “Non-GAAP Financial Measures” below for further information regarding EBITDA and a reconciliation of EBITDA to net income.

      The increase in gross revenues is primarily attributable to increased rental income resulting from the acquisitions of new properties for which we receive rent. During the period from October 1, 2004 to September 30, 2005, we acquired five assisted living facilities, 44 skilled nursing facilities and five specialty care facilities for $343,001,000.

      As discussed above, prior to June 2004, our standard lease structure contained fixed annual rental escalators, which were generally recognized on a straight-line basis over the minimum lease period. Beginning in June 2004, our new standard lease structure contains annual rental escalators that are contingent upon changes in the Consumer Price Index and/or changes in the gross operating revenues of the property. Since these escalators are not fixed, no straight-line rent is recorded; however, rental income is recorded based on the contractual cash rental payments due for the period. While this change does not affect our cash flow or our ability to pay dividends, it is anticipated that we will generate additional organic growth and minimize non-cash straight-line rent over time. If gross operating revenues at our facilities and/or the Consumer Price Index do not increase, a portion of our revenues may not continue to increase. Sales of real property would offset revenue increases and, to the extent that they exceed new acquisitions, could result in decreased revenues. Our leases could renew above or below current rent rates, resulting in an increase or decrease in rental income. As of September 30, 2005, we had no leases scheduled to expire before March 2009, except for the master lease referenced in Note M to our unaudited consolidated financial statements contained in our Quarterly Report on Form 10-Q for the period ended September 30, 2005.

      Interest income decreased from 2004 primarily due to a decrease in the balance of outstanding loans and non-recognition of interest income related to loans on non-accrual. Transaction fees and other income increased for the year-to-date period primarily due to a $750,000 assignment consent fee received in the first quarter of 2005 relating to a payoff which did not occur. There was no such fee in the prior year.

      Expenses were comprised of the following (dollars in thousands):