We appreciate any transparency from companies and how they are dealing with impact from COVID-19. As such, National Health Investors provided an update for its latest rent collection and occupancy results. The REIT collected 96.6% of contractual rent in September, which improved on the 95.3% success rate announced in August. In addition, 2.9% of rent was deferred, including 2.6% related to a previously disclosed deferral to Bickford Senior Living. The remaining balance reflected forecasted revenue that NHI had expected to receive from transitioned properties prior to the pandemic.

Another tenant has also agreed to a deferral of approximately $560,000 in each in each the third and fourth quarters of 2020 and up to about $450,000 in Q1:2021. Monthly deferral amounts should not exceed 1.7% of contractual rent in any month. And any amounts deferred will accrue interest at an initial rate of 8%, with repayments expected to start in July 2021 and finish within 18 months. Good news for NHI, but we also wonder how each operator is performing and whether they will run into issues with paying rent as the year goes along, especially as a census rebound is looking more and more difficult in 2020 with the start of Fall. 

On the occupancy front, NHI will have to wait at least another month to see census go up, as each major operator reported either no change or a decrease in the month of August. The Bickford portfolio experienced no decline, staying at 81.7% for the third month in a row, while the same-store Bickford portfolio declined just 20 basis points to 83.3%. That is pretty stable but for the whole Bickford portfolio is still 460 basis points lower than occupancy in the fourth quarter of 2019, and 520 basis points lower for the same-store portfolio.  

NHI’s other operators disclosed worse census declines month over month, with the nine properties operated by Senior Living Communities falling 40 basis points to 78.8% in August, following a 20-basis point improvement in July. Overall, since the fourth quarter of 2019, SLC’s census has been remarkably stable, losing just 160 basis points through August. Meanwhile, Holiday Retirement’s 26 properties dropped 110 basis points to 79.6%, which is 740 basis points lower than the Q4:19 average occupancy. That turnaround cannot come soon enough.