The 55+ Market Builds Momentum
Coming out of the pandemic, investors are enamored with the 55+ or active adult market, but we will see if that enthusiasm turns into overexuberance. Perhaps the brightest star in seniors housing coming out of the pandemic has been the active adult market, and investors took notice. Census stayed strong relative to the other sectors, and owners tout their lower average move-in age, more approachable rents for residents, lower labor costs and higher operating margins. As a percentage of seniors housing deals announced, according to our deal database, active adult has grown its share from a paltry 2% in 2019 to 6.4% in 2020 and 8.2% so far in 2021. Plenty of firms have also announced... Read More »
Is Connecticut The Future For Wage Hikes?
In order to avert a strike by unionized nursing home workers, a deal is being struck with the state that will send hourly rates soaring. In order to avoid a union strike at dozens of Connecticut nursing facilities, the Governor stepped in to help the two sides reach a deal. And what a deal for employees. Most hourly workers will have a pay raise set at a minimum of $20 per hour. CNAs will be increased from a $12 to $15 range to $20 per hour, while LPNs will have a minimum of $30 per hour. There are also increases in pension contributions and health and wellness programs. Most of the money will come from the state, with an extra $47.3 million in 2021 and $121.1 million in 2022, all going... Read More »
“Going Concern” Problem For Capital Senior Living
Perhaps in an effort not to rattle the market, Capital Senior Living filed its first quarter 2021 10-Q after the markets closed on Friday, May 14. Perhaps they thought no one would notice as many were out celebrating the removal of their masks. Not that it should have been a surprise, but in the filing the company reiterated its dreaded “Going Concern” statement, meaning there are enough uncertainties about current events and conditions that raise substantial doubt about the company’s ability to continue as a going concern within a year. No one should be surprised, other than those who have been pushing the price up in the past month. Helloooo. Last week after reviewing the financial... Read More »
Canadian Seniors Housing Market
The Canadian seniors housing market has fared a bit better than its U.S. counterpart during the past year or so, but it also started in a better place. Take the Canadian SHOP portfolio of Ventas. It currently has 74 communities that operated in the first quarter 2021 with net operating income of $171.8 million, or just over $2.3 million per community (all amounts in U.S. dollars). This compares with 364 communities with $272.7 million of NOI in the first quarter for the U.S. SHOP portfolio, or $749,000 per community. So, Canada makes up 17% of the communities but 39% of the NOI. Hmmm. On a same-community basis, there were 68 Canadian communities in the first quarter last year... Read More »
Are More Capital Senior Living Problems Coming Due?
Capital Senior Living released its first quarter earnings this week, and the results were sort of a mixed bag. Of course, the occupancy results were great news, with April average census rising 140 basis points from the Q1 average to 76.95%. And spot occupancy increased from 75.3% at the end of February to 78.5% by the end of April, for a 320-basis point increase. We’re not sure if we’ve seen a steeper increase. About 93% of residents are now vaccinated, COVID cases fell to zero across the 60 owned communities, and 100% of communities are open to new residents, so the runway to recovery is smoother. Looking forward, CSU will also not be encumbered by the 39... Read More »Schedule a demo
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