Still Slow Go For Brookdale
Brookdale Senior Living is like an aircraft carrier. It takes a long time to change direction, and the current may change while making the attempt. Brookdale is the largest senior living company in the world, and while that fact can have its advantages (data collection, purchasing power, ancillary services, etc.), it can also work against you. In a recent study by NIC MAP of its data, they found that nearly one in three communities operated by “very large” companies have occupancy below 80%. We assume Brookdale is included in those statistics. Brookdale’s portfolio continues to lag behind the overall market with census improvement, and it remains under 80%. Consolidated occupancy in... Read More »
Is LTC Properties Ready To Grow?
There is no question that the operating environment, and investing environment, has been tough on REITs. Most have spent the past two years adjusting their portfolios, either selling properties that were not performing and had little likelihood of getting back on track, or switching out operators to new ones that had a better chance of succeeding. Often, it was both, including working on their capital structures. LTC Properties, with one of the smallest market caps ($1.3 billion) among the healthcare REITs, but also one of the most stable management teams, has worked on all three issues. Last year and the fourth quarter represented moves and changes that may put the REIT into a better... Read More »
Priority Life Care Does It Again
Not once, not twice, but now several times Priority Life Care has been brought in by an institutional owner of underperforming senior living assets and turned them around in less than a year. The company’s track record is attracting even more institutional interest. In the most recent example, American Healthcare REIT (NYSE: AHR), which just closed its IPO, hired Priority Life last May to manage six senior living communities in Indiana (5) and Michigan (1) that were losing money on 78% combined occupancy. The communities have a combined 652 units, with assisted living comprising 389 units, independent living 188 units and memory care 75 units. The licensed bed count is higher, and the... Read More »
Ventas Reports
After Welltower’s solid fourth quarter performance, all eyes were on Ventas, which has not pursued the aggressive growth path that Welltower has. Operating metrics were up in its SHOP portfolio of seniors housing communities, but not up as much as investors would have hoped. But that is not the fault of Ventas; rather, it is the fault of the operators that are underperforming. Same-community occupancy increased 170 basis points in the fourth quarter, year over year, to 84.9%. Revenue was up year over year by 7.0% while expenses were up just 4.2%. This drove a 15.0% increase in cash NOI and a 180-basis point increase in the NOI margin to 25.4%, and this is after management fees. Not bad,... Read More »
Sonida Senior Living Readies for Next Phase
Don’t you love it when a plan finally comes together? Sonida Senior Living has been working diligently to streamline its capital structure, not to mention improving its census and margins. Yesterday they announced two major developments which should set the stage for future growth. First, they purchased $77.4 million of outstanding debt held by Protective Life for $40.2 million, or a 52% discount, across seven communities. We are not sure we have seen that large of a discount in the market, and perhaps news of this will light a fire under some other creditors. Part of the purchase price was funded by a $24.8 million expansion of Sonida’s existing term loan with Ally Bank. An additional $44... Read More »Schedule a demo
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