It was great to see so many in the industry in Scottsdale last week at ASHA’s annual meeting, but we can’t say the mood was as positive. Some industry veterans didn’t sugarcoat it and commented to us that we are in the most difficult operating environment they have ever seen.
Tough to argue with that. Then you had dealmakers fresh off of a myriad of deals postponed, terminated or re-traded, with only a tiny fraction of transactions closing without issues. Then you have other problems like soaring property insurance costs that can throw a wrench in a deal, to put it mildly, and will be a bigger issue when the time comes for hundreds of properties to renew their policies. We will dive deeper into our thoughts on the conference in the upcoming issue of The SeniorCare Investor.
As we head to Florida next week for eCap, we wonder if we’ll find the same mood there. By many accounts, skilled nursing deals have been far easier to close than seniors housing, especially when there is an assumable, fixed-rate mortgage on the property or there is a relatively easy opportunity to improve quality and case mix. And facilities big and small, struggling or cash flowing usually generate an active bidding process, sustaining the sector’s high values somewhat despite the interest rate environment. Will the party ever end? Not at eCap itself, we hope.
