Although not unexpected, occupancy levels at Brookdale Senior Living have continued to decline, much like the rest of the industry. But with Brookdale, occupancy at the end of December had tumbled to 71.5%, a 160-basis point decline from the end of November. This was the worst month-to-month decline since the end of April to May period, which was 150 basis points. The worst month came in April 2020 when the drop was 220 basis points. That was the previous COVID height, but the numbers nationally today are much worse. Average occupancy in December declined by 150 basis points to 71.5%.
We are not sure what to expect after the Christmas and New Year’s holidays and the associated spike in infections and increased fear among the public. Our guess is that Brookdale’s census will continue to fall in the first quarter and may get below 70% by the end of February. That said, 89% of Brookdale’s communities were open for move-ins on December 31, 2020, and around 90% of its communities have either successfully completed or are currently scheduled for initial COVID-19 vaccine clinics, with more clinics being scheduled daily. As the vaccines get into the public, the nightmare will begin to go away. Keep in mind, however, that historically the first quarter of every year is the worst for occupancy, year in and year out.
Brookdale also reported that in the fourth quarter they expect to recognize about $78 million from government grant programs, but just $30 million of COVID-related expenses. That seems to be out of balance but may be a timing issue. Who cares? That is a significant amount of financial help, especially going into the always difficult first quarter.
