Wall Street Watch

$200 Milllion of Securities Affected.

New York, July 12, 2002 -- Moody's Investors Service has revised the rating outlook (senior debt at Caa1, preferred stock at Ca) for Omega Healthcare Investors, Inc. to stable, from negative. The change in outlook reflects the recent repayment of the $125 million of senior notes that were due in June 2002. Following this repayment, there are no debt maturities until December 2003, when the REIT's senior credit facility comes due. Omega's earnings pressures have improved as more operators, such as Sun Healthcare and Mariner Healthcare, which comprise 33% of Omega's property portfolio, emerge from bankruptcy. To the extent that cuts in government healthcare reimbursements put additional pressure on operators, Omega may be under renewed financial stress. Omega is not paying its common or preferred stock dividends, with the latter in arrears by over $25 million.

According to Moody's, improvements in Omega's ratings would come from further strengthening of operations within a prudent strategic plan and from an end of arrearages on preferred dividends. A decrease in secured debt would also be a plus.

Omega Healthcare Investors, Inc. [NYSE: OHI] headquartered in Timonium, Maryland, USA, is a Real Estate Investment Trust (REIT) investing in and providing financing to the long-term healthcare industry -- preponderantly nursing homes. Omega owns or has mortgages on 234 skilled nursing and assisted living facilities with approximately 24,500 beds located in 28 states and operated by 37 independent healthcare operating companies. Omega Healthcare Investors, Inc. had assets of $915 million and equity of $501 million at March 31, 2002.

New York
Merrie S. Frankel
VP - Senior Credit Officer
Real Estate Finance
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

New York
John J. Kriz
Managing Director
Real Estate Finance
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653