Senior Care M&A Results For 2016
M&A activity in seniors housing and care in 2016 nearly matched that of 2015. Our preliminary results are in, and in the senior housing and care market, 2016 looked very similar to 2015. The dollar value of publicly announced senior care M&A transactions was $14.4 billion last year, just edging out 2015’s $14.2 billion. The number of deals, however, declined by 6%, falling from 359 in 2015 to 337 in 2016. This latter number may rise as a few more disclosed deals are discovered, but it still ranks as the second most active year ever. The dollar total for the fourth quarter of 2016 represented 45% of the year’s total, as a few large transactions came in, something that was in short... Read More »
Assisted Living Occupancy Woes….Again
According to NIC data, assisted living occupancy dropped in the fourth quarter, which was not a good way to end the year. I don’t like to start the new year off with an “I told you so,” but I will. Fourth quarter occupancy trends were just released by NIC, and let’s just say they were disappointing. Surprising? No, but disappointing? Yes. The fourth quarter is usually looked upon as a solid quarter, with occupancy increases that are necessary to fend off declines in census from what can be bad flu seasons in the first quarter. Until recently, some providers were denying that the jump in development was impacting their census. But privately, we knew there was a different story, even with... Read More »
Changes already for 2017
Welltower has a management shuffle, and The Ensign Group expands its real estate ownership. Well, first of all, Happy New Year. I am not sure if it is going to be all that happy, bumpy yes, happy, it will depend on your perspective. For the first act of the new Congress to upend their own ethics rules, and then to rescind what they just passed, well, one would think they have more important things to do. Perhaps they are waiting until January 20. Meanwhile, we are heading into a year of uncertainty as well, with the full impact of rising interest rates not felt yet, even though financing activity seemed to take a breather in December. The only big news was that at year-end The Ensign Group... Read More »Quality Care Properties Cuts Rent
Within weeks of being spun out of HCP, Inc. (NYSE: HCP), Quality Care Properties (NYSE: QCP) announced that it had agreed to a two-month temporary rent reduction for its major client, HCR ManorCare. December’s rent was reduced by $15.0 million, or nearly 40% below what it should have been, and January 2017’s rent will be reduced by $10.0 million, or 25% below what it should have been. Quality Care Properties agreed to these reductions in response to a request from HCR ManorCare because of the “continuing financial deterioration” at the company. QCP believes this partial and temporary relief with give it time to “perform due diligence and gather information about the Lessee in advance of a... Read More »
Investors, and Congress, Ignore MedPAC
Since November’s crash, skilled nursing prices continue to rise. We sometimes wonder if the members of the Medicare Payment Advisory Commission, or MedPAC, ever get frustrated that their recommendations often go unheeded by Congress. This is certainly the case with recommendations for skilled nursing Medicare reimbursement. Last week, MedPAC recommended a Medicare rate freeze for SNFs through 2019, which Congress will surely ignore….again. Because Medicaid policy is not part of its charter, the MedPAC commissioners ignore it, even though they are keenly aware that in SNFs, Medicare payments subsidize low Medicaid payments. Medicare payment increases are usually quite small, but that... Read More »Schedule a demo
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