The Senior Care Pricing Disconnect
The public equity market for senior care operating companies and REITs is getting slammed, but the private investment market remains strong. The pricing disconnect continues. Public equity investors continue to slam the senior care operating companies and health care REITs. All one has to do is look at what has happened to Kindred Healthcare and Genesis Health this past week or two, when both companies dropped to new lows and have not yet recovered. Fears of reimbursement pressure, fears of OIG investigations, fears of staffing costs. All have some degree of merit, but it seems like an overreaction to me. Just look at the private market, where both acquisition pricing and demand remain... Read More »CCRCs to Become LPCs?
Leading Age announced this week that they are proposing a new name for CCRCs: Life Plan Communities. What is it about all these name changes? First we have Health Care REIT becoming Welltower, followed by ALFA becoming Argentum. Now Leading Age, which already changed its name several years ago, has proposed that the industry adopt a new name for CCRCs, coming up with “Life Plan Communities.” A lot of people have had a desire to get away from the alphabet soup acronyms that are so common (ALFA, ASHA, AHCA, AAHSA), but these acronyms do make it easier at times. Will the new name become LPCs? That sounds a bit clinical to me, but who... Read More »Immigration and Seniors Housing Labor Woes
Bringing in low-skill, low-wage immigrants for seniors housing may not be the answer. There have been calls to ease immigration in order to bring caregivers into the U.S. to fill low-skill jobs in seniors housing. As you know, this is a need that will be growing for the next 30 years or more, so the demand for labor is not the issue. But here’s the flip side of this. There are about 6 million workers in the U.S. with part-time jobs looking for full-time jobs. There are also, by one count, at least 600,000 people who have stopped looking for jobs. But that seems low to me. The point is, there are plenty of people who want full-time work in this country. And there are plenty of people who... Read More »Slumping Ventas
Investors did not like what they heard about Ventas for the third quarter, despite an earnings beat. So, when we first heard that Ventas was announcing that third quarter earnings were going to exceed estimates, we thought, ho-hum, so what else is new, they always beat estimates. The press release was glowing about all the accomplishments during the quarter. They revised guidelines for the full year slightly upward. I didn’t get a chance to listen in live to the earnings call, but I did notice how the share price dropped by 5%. What, on an earnings beat? And then it dropped a little more. It was the revenue miss and concerns about growth that sent investors to the exits. Since then, there... Read More »Independent living price continues decline
The average price per unit paid for independent living communities fell to a level not seen since the four quarters ending Q3:13. In the four-quarter period ending September 30, 2015, buyers paid on average $188,200 per unit for independent living. That is a 24% decline from the heights of the calendar year 2014, when the average price paid was $246,800 per unit. In fact, every four-quarter period since then has fallen from that mark. This sharp drop off may be explained by a decline in both portfolio sales, which typically sell for a premium, and in high quality properties, which was the biggest driver behind the 2014 record. Read More »Schedule a demo
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