Brookdale Senior Living has posted occupancy increases for several consecutive months. The operator has lagged behind the industry for a decade now, so it is about time.
Weighted average occupancy has increased each month since January, beginning at 79.2% and reaching 82.5% in September. The third quarter’s average of 81.8% is up 290 basis points year-over-year, and 170 basis points sequentially. Same-community weighted average occupancy of 82.7% increased 270 basis points year over year, and 40 basis points sequentially. Third quarter same community occupancy of 82.3% increased 260 basis points year over year, and 150 basis points sequentially, reflecting the highest sequential growth since 2022.
Investors reacted positively to the report, with Brookdale’s stock reaching a high of $9.08 the morning after the results were published, an 11.82% increase from yesterday’s close. That price is the highest it has been since September 2018, when it was at $9.70.
Brookdale’s occupancy uptick is encouraging, but occupancy gains alone do not tell the full story. We will have to wait until the third quarter financial results are posted to see whether these increases are translating into higher profitability, and if optimism will hold.
Plus, Brookdale is often seen as a benchmark for the industry, which averaged 88.7% occupancy in the U.S. during Q3:25, the 17th consecutive quarter of occupancy rate increases, according to NIC MAP. NIC MAP stated all 31 primary markets tracked across the country are at or above 85% occupancy, anticipating that average occupancy rates will be above 90% by the end of 2026.
Many of Brookdale’s peers are already at or above Brookdale’s current occupancy levels, especially in same-community metrics. And, we’re heading into flu season, so you’d expect gains this time of year for Brookdale. Will the gains be sustained through the winter?
Though the company still has some catching up to do, these results should be celebrated. It’s unfortunate this cause for celebration did not happen earlier, under Cindy Baier. The company missed out on quite some time of growth and momentum. But it hopefully means the new CEO Nick Stengle can hit the ground running.
