60ish Seconds with Steve Monroe: For Sale
From the title of this, I am sure you thought I was going to talk about some seniors housing community or company for sale. But no, unfortunately, I am talking about the Oval Office being for sale, and it is disgusting. Although he is not the only President to pardon criminals and tax cheats, there seems to be more of a pattern with Donald J. Trump, as it pertains to our industry. It started in his first term when he commuted the 15-year sentence of Jon Harder, the founder and CEO of Sunwest Management, who in the 1990s and 2000s built up a huge portfolio of seniors housing communities, overpaying for most of them along the way. But it all came crumbling down when his lenders decided... Read More »
60 Seconds with Steve Monroe: Brookdale Senior Living and SWAT
Brookdale Senior Living announced it had recently formed SWAT teams to deal with its lowest-occupancy buildings to try to get them over the 80% hump, and there are a lot of them. Since then, the term SWAT team has been appearing more and more with other providers. SWAT is a scary term, and stands for Special Weapons and Tactics, and in law enforcement is used to deal with barricaded persons, active shooting scenes and high-risk search warrants. Not exactly something we want to be associated with trying to get customers into senior living. But I understand the intent. The other frequently used term is the “silver tsunami” about to hit us. Again, a tsunami is extremely destructive,... Read More »
60 Seconds with Swett: The Republican Budget and Medicaid Cuts
There will be significant political interest in what happens to Medicaid funding as Republicans work to pass a budget and tax bill with their very slim majority. Touching entitlements remains politically risky, and the party is divided on whether any Medicaid cuts would be acceptable heading into an election cycle. At this stage, per-capita caps on federal Medicaid payments to states do not appear to be under serious consideration. However, even without direct federal cuts, rulemaking changes could materially affect Medicaid-dependent providers. CMS has issued a proposed rule that aims to close what it describes as a Medicaid “tax loophole” that some states have used to inflate federal... Read More »
60 Seconds with Swett: Welltower Is on a Roll
Welltower came out with its first quarter earnings on Tuesday, and surprise, surprise, it was yet another great quarter, and its share price jumped 3.5% immediately upon the news. It was the tenth consecutive quarter in which same store SHOP NOI growth exceeded 20%, at 21.7% in the first quarter. Guidance for same store NOI growth also rose by 100 basis points to a midpoint of 19.0% for FY2025. On Tuesday’s call, Welltower did mention that SHOP margins remain below pre-pandemic levels, but they may not be for long. Also, that issue currently plagues thousands of communities in this country and was prevalent in the years before COVID too. Perhaps that is why most of what we hear from... Read More »
60 Seconds with Swett: April Already Passes 50 Transactions
Tariff turmoil? Volatile and still-high interest rates? Uncertainty surrounding Medicaid spending, labor costs and HUD’s queue length? Seniors housing and care dealmakers have looked past a lot of this noise to announce 50 transactions in the first three weeks of the second quarter, putting the market on track for the busiest M&A period ever. We know we sound like a broken record, but the start of April did feel like we reached a new level of activity, and given the conversations we’ve been having in the last few weeks, the second and third quarters may only accelerate in deal volume. For some sellers, seeing through the January 2025 rate increases was enough to enter the transaction... Read More »Schedule a demo
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