REITs Having Trouble With Seniors Housing
We have heard more about REITs and their skilled nursing troubles, but LTC Properties’ announcement a month ago has been followed by a much larger seniors housing problem at Ventas. At first, everyone thought it was the skilled nursing sector that was going to give the healthcare REITs heartburn. After all, that was the sector struggling the most, right? But seniors housing has not been as resilient as previously thought. Brookdale Senior Living has had its well-documented problems, and last month LTC Properties disclosed issues it was having with underperforming memory care tenants. Then we had last week’s disclosure by Ventas that it was moving more than 70 communities leased to... Read More »
Senior Housing & Care Acquisition Pricing Softens
Across the senior housing and care spectrum, average per-unit and per-bed prices softened a little in the four quarters ended September 30, 2017. I am sure a lot of you have heard that the senior housing acquisition market is soft, reflecting concerns over census and rising costs. But how soft? Not very, according to our recent acquisition data. For the four quarters ended September 30, the average price per unit for assisted living did drop compared with the four quarters ended June 30, but by only 4% to $208,200. It is still higher than the $193,650 per unit for calendar year 2016. The average AL cap rate dropped to 7.9%. The independent living market softened a little as well, with the... Read More »
Time To Invest In Brookdale Senior Living?
Recent bad news had no impact on Brookdale Senior Living’s share price, leading me to believe that bottom may have been hit. Is now the time to finally invest in Brookdale Senior Living’s stock? This week, the company announced that it will take an EBITDA hit to 2017 earnings of up to $13 million as a result of the hurricanes in Texas and Florida. In addition, they expect to spend up to $14 million in total for capital remediation for some of the affected properties. On top of this, it was announced that their COO will be leaving at the end of the month. A good COO is exactly what the company needs most right now, so this may be problematic. But, from what we had been hearing, this... Read More »
Who Is Investing In Skilled Nursing Facilities?
Despite reimbursement pressures and dropping occupancy levels, investment demand for SNFs remains high. But why? Do you want to find out who is investing in skilled nursing facilities and why? Perhaps you may be asking, who would invest in the SNF sector today when reimbursement pressures are growing, labor shortages are hurting, occupancy levels are dropping, and costs in general are rising faster than reimbursement? Actually, a lot of companies are investing in the sector. In fact, in the third quarter, 46% of the targets in the M&A market were skilled nursing facilities or portfolios. And the third quarter was not particularly unusual in this regard. The market remains quite vibrant... Read More »
Takeaways From Fall NIC Conference
Last week’s NIC conference displayed the growing divergence of opinion on the state of the seniors housing and care market. A lot of people have asked me what I thought about the recent NIC conference in Chicago. Well, I have been covering the seniors housing and care sector for 30 years, I have attended all 27 fall conferences, but never have I heard such divergent opinions regarding the state of the market as I did last week. On the one side, you have those who are hoarding their cash, or raising new money, waiting for the market to take a plunge so they can take advantage of cheap prices. Most of these people have been around for a while, and like me, let their historical... Read More »Schedule a demo
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