Sabra Health Care REIT’s First Quarter
The big news in Sabra Health Care REIT’s first quarter report was that effective May 1, they are completely out of the 49% joint venture with the Enlivant portfolio that encompasses 154 assisted living communities. The J/V had been in default on the portfolio’s debt, and since there was no recourse to Sabra, it was time to cut the cord. Sabra’s investment had been written down to zero a while ago, so there was no financial impact with the decision. The J/V agreement contained a provision that allowed either partner to walk after a certain period of time. While we understood the original rationale to make this investment to diversify from its skilled nursing portfolio, the price... Read More »
Welltower’s Seniors Housing Portfolio Improves
Welltower’s seniors housing operating portfolio (SHOP) continued on its road to recovery in the first quarter of 2023, a quarter that historically has always had a difficult time. Same-community SHOP net operating income surged an impressive 23.4% year over year, as well as by 6% sequentially. This was helped by COVID going into remission and a mild flu season. Same-community SHOP occupancy (746 communities) increased by 240 basis points year over year, and by 10 basis points sequentially, to 79.4%. The year-over-year increase was less than what we expected, and we have to believe that Welltower management is still concerned about the overall level of occupancy at this point in the... Read More »
The Volatile Insurance Market
As the M&A market declined in activity from the heights of early-2022, we kept hearing that every deal was much harder to close and experienced more delays than in recent memory. The capital markets had a major impact on that, understandably, but another wrench thrown in many buyers’ M&A plans was the volatile (and pricey) insurance market for both the property’s real estate and operating business. There are plenty of reasons to explain the increase in insurance costs in the last year. First, rates had been dropping for about 15 years until around 2018/19 due to providers wanting to build scale, even if it meant taking losses to get there. Then, as Chip Stuart of HUB... Read More »
Omega Healthcare Investors’ Shares Surge
The good news seems to keep on coming. Omega Healthcare Investors released its first quarter 2023 results, and while the past was still problematic, the future is looking brighter. The REIT is the largest owner of skilled nursing facilities in the country, and its customers were particularly hard hit in the pandemic. It appears, however, that most of the restructurings and asset sales are behind them, even though there are a few significant ones ongoing. The positive attitude and look to the future sent the share price surging by nearly 10%. The recently announced rent and interest deferrals, and changes, include LaVie, Maplewood Senior Living, Agemo (which has resumed its $6.4 million... Read More »
LTC Properties Reports First Quarter Results
We are still in the beginning stage of the first quarter earnings season with just a few companies in our sector reporting so far. LTC Properties reported first quarter results on April 27, with earnings slightly below expectations, but revenues above. LTC is one of the smallest REITs in our sector, but the only one that pays its dividends monthly, which we always considered a plus for investors. Like all of the REITs, some of their operators have had challenges during the pandemic keeping up with lease or mortgage payments, but there appears to be a flicker of light at the end of the tunnel. The good news for LTC is that they really have no significant debt maturities looming for the next... Read More »Schedule a demo
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