Good morning, my name is Sara and I will be your conference operator today. At this time, I would like to welcome everyone to the LTC Properties year end conference call (Operator instructions). This presentation may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties which may cause the company's actual results in the future to differ materially from expected results. These risks and uncertainties include among others general economic conditions, the availability of capital, competition within the financial services and real estate markets, the performance of tenants and borrowers within LTC Properties portfolio, and regulatory and other changes in the healthcare sector as described in the company's filings with the Securities and Exchange Commission. I would now like to turn the call over to Ms. Simpson, Chief Executive Officer of LTC Properties.

Thank you Sara. Good morning and good afternoon and thank you all for joining us for our 2008 year end conference call. I will make some brief comments on our fourth quarter and our year and then Pam Kessler our Senior Vice President and CFO will give you a more detailed analysis of the quarter and the year. Basically we reported for after the close of the market yesterday a fully diluted FFO for the quarter of $0.42 per share and for the year $1.86 per year. That is not including – if you did not include non-cash compensation charges, these amounts would have been $0.43 and $1.91 respectively. Also in the quarter we had some expenses that could be viewed as one-time expenses such as legal expenses for deals we did not consummate and for some lingering crosses for our Sunwest property. When Pam gives her analysis, she will provide you with some more specific details on those amounts and some other small amounts. During the quarter we did complete our redeployment of the Sunwest properties. We had two own properties in California, they were both assisted living properties, we transitioned those properties to be operated by Ameritus [ph] and Ameritus began operating those properties on December 1. So they are under a long-term mass release with Ameritus and we are very pleased to have Ameritus as an operator. We did foreclose on the one independent living property in Fortworth, Texas that Sunwest had a mortgage done, we have that being operated by a small local operator. Independent living is probably one of the most challenged levels of care at the moment because of the economic situation. We have provided a certain amount of capital to be available to this operator to remodel the property, to put up some…

Thank you Wendy. I am going to talk about quarter over quarter since the year over year analysis is in the 10-K that was filed yesterday. Revenues decreased this quarter over last quarter $339,000 due to the following. Rental income increased $143,000 primarily due to the fact that in the third quarter we were up $124,000 in straight-line receivable due from Sunwest. In the third quarter we had one month of Sunwest rent at $208,000 and in the fourth quarter we had one month of Ameritus rent at $150,000 that is $58,000 lower on a monthly basis and $700,000 on an annual basis. This decrease in cash rent was offset by $75,000 normal rental rate increases due to step up. Hence our rental rates increased 50 basis points quarter over quarter and for the year they increased 3.2% excluding default of leases. Straight-line rent net of amortization of lease inducement costs was $714,000 in the fourth quarter. In our supplemental, this quarter you can see what we anticipate straight-line rent to be for 2009 and for 2010 we anticipate, based on current leases and trades assuming no new acquisition, that straight-line rent would decrease $1.7 million from 2009 (inaudible). Mortgage interest income decreased $427,000, $251,000 of the decrease was due to the prepayment of two loans in the fourth quarter resulting from sales of those properties. The prepayments totaled $5 million and resulted in $145,000 lower cash interest income and a write-off of $106,000 of effective interest receivable that is essentially straight-line interest receivables. The remaining $176,000 decrease is due to the normal effect of amortizing loans and our loans are amortizing about $1 million a quarter. Interest and other income decreased $55,000 due to lower interest rates on our overnight investments in cash, legal expenses due to transactions that…

Thank you Pam. Right now looking at the year going forward, I can say that the deal flow seems to be almost nonexistent. While we do get calls mostly right now to consider loans, we are finding that the people looking for loans have not yet stepped to the new reality of the changed market. We got a call the other day somebody looking for 90% loan to value on assisted living property in New Jersey. We sort of passed on that opportunity but we are taking the calls and we are looking at a possible transaction, I don’t see anything currently on our list of things we are following up on that. I would say we would complete in the first quarter of 2009. We have had some additional enquiries from our SNIP [ph] operators about investing in properties that we own and that they operate. These are enquiries that we have not had in the past and so Clint is spending time with those operators and in fact is going out I think next week to look at some properties that we had not had an opportunity to invest in in the last couple of years. So I am hopeful that we can spend a few million dollars in improving properties and investing money in our properties and getting some return on that. Right now we are very focused, carefully focused on our assisted living properties to make sure that the repairs and maintenance of these buildings are being done by the operators. In a few instances lately we have seen (inaudible) before inexperienced deferred maintenance. I will personally be talking to the operators about properties that need immediate attention. If the operators are having some cash flow problems, we will offer funding under various terms as it…

Your first question comes from the line of John Roberts, your line is open. John Roberts – Hilliard Lyons: Hi Wendy.

Hi John. John Roberts – Hilliard Lyons: First a little housekeeping, I think you mentioned $700,000 in lower rents with the Sunwest (inaudible) swaps, is that on a go forward run rate?

On a going forward run rate, it is approximately the same because of straight-line, right, it is. In the first year it is $700,000 lower than it was under Sunwest. In the second year, it was $500,000 lower than I understand last. In the third year $100,000 lower than the last and at the end of year 3 Sunwest would have been –

But you are still doing cash?

Yes, on a straight line basis. It is not low.

Do you know, do you have the straight line?

No, I do not have the straight line, I am sorry. John Roberts – Hilliard Lyons: Straight line is the –

I believe straight line is a push – John Roberts – Hilliard Lyons: Yes, right.

I believe straight-line is more because Sunwest was coming in at the end of their lease so their cash rent was higher than their straight line rent where Ameritus ends up counting income from Sunwest as opposed to Ameritus.

From straight line I do not have that detail (inaudible).

Okay, we will get that, we will get that and we will publish it somewhere. John Roberts – Hilliard Lyons: Great. Thanks. You actually answered one of my questions as to what happens to that $25 million investment, when you say both of you have decided basically not to go along with the deal and I am kind of surprised that you would have decided that given your liquidity, did you have some reticence about using the credit line to finance it or is that situation in your perspective?

It was at an interest rate of, yield of a little over 9 and I thought that we would have opportunity in excess of 9 and so – no it was not reticence about, it was about making a long-term investment at 9 at that point of the economy. John Roberts – Hilliard Lyons: Got that. Any thoughts on what you should be looking at right now as far as cap rates go?

Yes, we are looking at 11 to 12 yields. John Roberts – Hilliard Lyons: That’s right.

It is and as I understand our competitors are quoting approximately the same thing in terms of looking at a deal. We have always been in the double digits and – John Roberts – Hilliard Lyons: Sure.

And we had to maintain our double digits whereas I think it is comfortable that other people are now in our double digit category. John Roberts – Hilliard Lyons: As far as repurchases go, you mentioned you didn’t do any repurchases in the current quarter and it sounds like you are more interested in issuing stock versus repurchasing at this point.

For instance John, if a loan advise me that they are going to pre-pay because they sold the property and I was getting $2 million, $3 million or something like that our loans on a weighted average have about 11% yield, so I would look to use that $2 million to possibly buy back stock, our preferred (inaudible) are approximately yielding that, I have not looked at the market today but I would redeploy that money because it is long-term money probably to buy back estimates we had further softening of our common stock and the yield was in that area, I would buy back some common stock because the balance sheet assets are going down and the equity should go down. I would only issue equity to take out a draw on the line for a large amount, I mean I am probably not going to issue equity for $1 million deal but if we drew our line down by $10 million or $20 million, I would start looking at maybe we should issue equity to make that a permanent investment as opposed to an investment under the line. John Roberts – Hilliard Lyons: And you are going to do that depending on what the share prices is I take it.

No, it would still have to be accretive to the transaction. John Roberts – Hilliard Lyons: Right. What I am saying is you would have to have the share price high enough in order to meet that goal.

Absolutely. John Roberts – Hilliard Lyons: Okay. You mentioned a little bit that you are hearing, taking calls from potential borrowers etc, can you just go a little bit further what these people are saying, what you are hearing, what they are looking for?

They are looking to take out often bank loans that they took in the last couple of years and the banks are not wanting to renew their loans and so mostly if people who finance using local banks, they are still looking at very high loan to value ratios and very low interest rate and a lot of them they are looking for bridge loans something like – what we want is, we want a loan and we are going to try to hug it or we are going to try to Fannie Mae it or something like that and so if people are looking for temporary money at this moment, it would be a fairly unique situation where we would get involved with some temporary money. John Roberts – Hilliard Lyons: Potentially that creates some opportunity that some of these borrowers can’t get financing due diligence and scoop up some asset at good prices?

Yes, I mean that is why we take the call. It is always good to have a call, have a contact, and we follow up to see what they did, where did they finally find the financing and we are very – we don’t do lot leaders, we say this is what we need and we don’t change what we need and how we would view something, so all of these are marketing opportunities John, absolutely. John Roberts – Hilliard Lyons: And finally, I will let somebody else ask some questions here, you mentioned a dividend, obviously you are going to increase it now for what four years, right?

Right. John Roberts – Hilliard Lyons: My assumption is there is no thought about increasing it this year in the current environment.

Correct. John Roberts – Hilliard Lyons: Thanks Wendy.

Thank you John.

Your next question comes from the line of Karin Ford, your line is open. Karin Ford – KeyBanc Capital Markets: Hi, good afternoon.

Hi Karin. Karin Ford – KeyBanc Capital Markets: My first question is you guys don’t have any CPI based escalators in your leases, is that correct?

I think Brookdale is a CPI escalator with a minimum of 2%. Karin Ford – KeyBanc Capital Markets: Okay, so you will be at the floor this year but you have got 2% in the bank there, okay. Second question is your guidance assumes that the mortgage receivables, $7.65 mortgage receivable is repaid in November, is that correct?

Yes we do, Karin Ford – KeyBanc Capital Markets: Okay, just trying to make sure. And then finally just can you summarize, is the lease default the only opportunity that you guys will have to potentially replace them as an operator, is there any other means by which you could do that and have you had discussions with them given their issues since these properties don’t seem to be profitable for them that they would be interested in doing some kind of deal with you guys.

Yes, I have been reluctant to approach them but it is something that I am going to seriously consider. They would have to be proactive with us in doing that, I can’t force them to do anything without a lease default and I think that it might be as you say an opportunity to take a possible problem off of their plate and they might be very accepting of an opportunity and now that we have had some unsolicited offers to take a look at those properties and I have got some other operators in mind that I would like to have look at those properties, it is something that I think I might be doing in the near future. Karin Ford – KeyBanc Capital Markets: Thank you very much, very helpful.

(Operator instructions) Your next question comes from the line of Rich Anderson, your line is now open. Rich Anderson – BMO Capital Markets: Hi, good morning to you folks.

Hi Rich. Rich Anderson – BMO Capital Markets: Wendy you mentioned double-digit returns, can you distinguish between senior housing and net returns that you would expect to get you interested in the story?

Yes, it has been so long since we have looked at assisted living because the prices had been really still very high but it is really not – it is a function of our cost of capital and our need to get a return. So I don’t think I would be looking for a sub double digit and an investment in an assisted living as opposed to a SNIP. Rich Anderson – BMO Capital Markets: I did not think so I just wanted to make sure that –

Yes. Rich Anderson – BMO Capital Markets: In the journal today there is a story talking about Obama looking at the Medicare Advantage plan and trying to rein in some of the budgets as there is perceived to be some waste in the Medicare business to private insurance companies. I know Medicare Advantage is different than Medicare reimbursements and nursing homes but it is after all the same word, Medicare, I guess my question here is you mentioned you feel good about the reimbursement outlook for your portfolio for the business but in light of balancing the budget and all that, pressure that is on the system today, I wonder why you had that type of optimism?

Most of our operators are very tied into their states and into what is happening in Washington. We are not hearing, they are all fairly comfortable with their reimbursement level. Medicare, I would be more concerned if we had a lot of Medicare dependent SNIP. In the last several years a lot of people have invested in SNIP that are modeled that they had to have a very high Medicare component. All of our operators I am sure would like to have more Medicare coverage but I don’t think we have any that are 100% or a high percentage dependent on Medicare. Right now I have not heard anything, I have not read that article, I don’t know what Obama’s budget plan is, he is proposing, I don’t think with the margins that our operators are reporting to us in the SNIP areas and the fact that we had these properties for quite a long time and our lease rates are very reasonable that there is still a lot of margin between our rents and their profits. So, I still think we have significant cushion in our operators even if there are moderate cuts in the Medicare program. Rich Anderson – BMO Capital Markets: Right, fair enough. I am not sure if I understood this, you talked about the use of proceeds the potential to buy back stock but then also the potential to issue small pieces of stock through (inaudible) does that not send a mixed signal, can you explain to me why you can kind of talk or burn both ends of the candle?

Yes, I know, the underwriters wanted to know the same thing. Rich Anderson – BMO Capital Markets: Yes.

It is you know – I guess it is opportunistic, if we have a certain amount of capital available and we need to deploy that to the best return to our common shareholder and the other stakeholders in our company it is possible and in certain circumstances and we have not bought back common stock recently but in certain situations I think it is appropriate for us to take money that is provided to us by an asset that pays off like a loan to buy back common stock if I have no other place to put that capital that will return to the common shareholders. If the situation arises that our stock increases in value and it makes sense to issue the stock to do a transaction then for us to gear up to do a underwritten offering and to do an underwritten offering for $50 million, $75 million, we don’t generally have those transactions in front of us, so we have it in the last couple of years, it is sort of like I just think the company should have every financing option available to us and if we have the program, it is not necessarily that we have to use the program but we have to get up to speed, you have to get registered, you have to get all these documents done just in order to use it. So I guess it is opportunistic and I appreciate opinions on it. If it is going to cause a ripple in the market and investors are going to find this untenable that possibly we will be buying back stock or possibly we will be issuing stock then I would take that under consideration. I was just thinking of the optimum way of having liquidity available to us to maximize a return to the shareholders. Rich Anderson – BMO Capital Markets: Yes, I understand now, I do think it is a tough spin to sort of do both. I understand where you are coming from in theory, I would guess you will get some pushback on that from people who think about it in more mathematical terms. Anyway I just wanted to clarify.

Thank you Rich. Rich Anderson – BMO Capital Markets: That’s all I have. Thank you.

Alright, thank you.

There are no further questions at this time.

Thank you very much and thank you everyone for joining our call. Bye.

This concludes today’s conference call. You may now disconnect.