Brookdale Senior Living reported June and second quarter 2024 occupancy, and while census increased, is it enough to carry them through next year’s winter season? Probably not, unless they have a huge July and August, which is possible, but not likely.
Weighted average occupancy for June came in at 78.2%, up 10 basis points sequentially, but still below every month in the fourth quarter last year. Month-end occupancy was a little better, at 79.7%, up 20 basis points from May and up 50 basis points from April. But that 79.7% occupancy at the end of June is exactly the same as the end of September last year. That is not progress.
The press release had a great line. “Both June and second quarter weighted average occupancy results reflected a continued outperformance versus pre-pandemic normal seasonality.” Say what? Is that a stretch? Are they saying the seasonality impact was worse five and six years ago compared with the most recent months, and that is noteworthy and wonderful? And we are not sure what seasonality there is in June, other than good seasonality. Not to be a cynic, but this seems like posturing when the main news (census increases) needs to be better.
We do hope that new Board member Beth Mace, with all her industry knowledge, will be able to help management as they continue to dig out of the pandemic census mess. Perhaps she should tour the underperforming communities to see for herself what the problem is, and then make some recommendations. That’s what we would do. Brookdale’s recovery continues to lag the industry, and that has to change. According to NIC MAP, the 31 Primary Markets reached occupancy of 85.9% in the second quarter, or 770 basis points ahead of Brookdale. Brookdale’s share price dropped 3.2% in the two days after the release.
