Brookdale Senior Living is not the only one with some recent census declines…
The next few weeks will be very telling in terms of the direction of some of the major seniors housing companies. All eyes will be on Brookdale Senior Living next week as it announces second quarter results and whether it has reversed its downward occupancy trend. Brookdale’s stock price is down about 15% since June 1 and is at its lowest level in more than eight months. Those activist shareholders must be going nuts. We know NIC MAP indicated a tough second quarter in general, and we also know that the Atria Senior Living and Sunrise Senior Living properties in the Ventas stable posted a combined 40 basis point decline in sequential occupancy for the second quarter, which actually surprised us. One equity analyst has suggested that we should all focus on rate growth and not occupancy. But which rates? The stated rates or the discounted ones? Rate growth is important, but cost creep has been an industry problem. The Atria/Sunrise properties owned by Ventas had a 50 basis point sequential drop in average daily rate, but while this was happening the EBITDAR margin surprisingly jumped by 120 basis points sequentially. We assume the heating bills went way down.
