Assisted Living: Recession Resistant or Not?
Assisted living emerged from the Great Recession largely unscathed. Will history repeat itself 10 years later? Well, I just found out on Monday we are officially in a recession. Not that anyone needed to get the official notice, since we all know what 40 million recently unemployed means for the economy. But what does it mean for assisted living? In the “Great Recession” assisted living came out looking pretty good because of its need-driven characteristics. In the ensuing 10 years, average per-unit prices soared to record levels even as over-development caused some census issues. So, is this recession, or potential depression, going to be different? The elderly will continue to need care,... Read More »
Seniors Housing M&A Market Comes to Life
Welltower’s recent announcement of two portfolio sales at low cap rates during the pandemic bodes well for the market. It has been a quiet past few weeks in the seniors housing M&A market. Last week was the first time we can remember when we have gone an entire week without one announced acquisition. That leaves us worried as to the liquidity in the market and what we may expect in the coming weeks. Well, we breathed a sigh of relief when Welltower announced two separate transactions for seniors housing portfolios completed by Newmark Knight Frank with a total value close to $800 million. When the MOBs are added in, the total comes to about $1.3 billion. More details on these... Read More »
Two REITs Provide COVID and Census Updates
Welltower recently disclosed what has been happening at its large seniors housing operating portfolio (SHOP), and we again give them credit for being transparent with investors as to the operating performance of its customers. In the second quarter through May 29, its SHOP portfolio has seen occupancy decline by 420 basis points. That’s the bad news. The good news is that the weekly declines of 50 and 60 basis points in April have been cut in half to 20- and 30-basis point weekly declines in the latter half of May, ending with a 20-basis point drop the last week of the month. That still implies an 80-basis drop for a month, which would be terrible in normal times, but it is all... Read More »
Genesis HealthCare’s Shares Double in Value
Leading up to Genesis HealthCare’s first quarter earnings release and conference call, the company’s share price took off. The rise started on May 22 when it jumped by 22% on high volume, but then it added another 35% on volume that was 10 times the average. In the course of four days, the price more than doubled, from $0.63 per share to $1.37 before settling down. Subsequent to the earnings report, the price has dropped by 17% and is back below $1.00 per share. So, what were investors expecting from the first quarter, and more importantly, for the results in the weeks after the quarter ended? We’re not sure, because all things considered, it was a “decent” quarter, and operations and... Read More »
The Bifurcating Seniors Housing Market
The seniors housing and care acquisition market is bifurcating in more ways than one. We have all long talked about how the various seniors housing and care acquisition markets have bifurcated over the years. There is the vast difference between “A” quality and “B” quality assisted living communities. There are the old independent living communities vs. the new ones built with AL and MC included. There are the 40-year old SNFs compared with the sparkling new transitional care facilities. But as a result of this coronavirus pandemic and the economic shutdown, there appears to be another bifurcation that has developed. This one is based on outlook. There appears to be two... Read More »Schedule a demo
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