Ventas Reports Third Quarter Results
Ventas reported its third quarter results, and despite average census dropping below 80% for the first time, it remained on firm financial footing thanks to both federal relief grants and earlier moves to bolster its liquidity. In fact, Ventas improved its cash NOI from $402 million in the second quarter of 2020 to $545 million in the third quarter. Much of the gain came from its triple-net portfolio and mostly as a result of the agreement made with Brookdale Senior Living to reduce the provider’s annual cash rent to $100 million in return for consideration of approximately $235 million (including $162 million in cash) up-front. All of the $235 million in consideration is being amortized... Read More »
The “Post-COVID” Assisted Living M&A Market Takes Shape
It is safe to say the senior care M&A market in 2020 is quite different from that of 2019, in terms of the number of acquisitions closed, the values for senior care properties and perhaps most importantly, the types of properties actually put up for sale. Value-add and distressed communities have so far dominated the market since the onset of COVID-19, as owners of newer, stabilized communities are largely sitting on the sidelines to wait for a seller’s market again. Who knows when that will happen? Assisted living communities have been hit hard across the board, census-wise and with cash flow too. As a result, we have seen the sales of many struggling communities, which brought... Read More »
National Health Investors Provides Occupancy and Rent Update
We appreciate any transparency from companies and how they are dealing with impact from COVID-19. As such, National Health Investors provided an update for its latest rent collection and occupancy results. The REIT collected 96.6% of contractual rent in September, which improved on the 95.3% success rate announced in August. In addition, 2.9% of rent was deferred, including 2.6% related to a previously disclosed deferral to Bickford Senior Living. The remaining balance reflected forecasted revenue that NHI had expected to receive from transitioned properties prior to the pandemic. Another tenant has also agreed to a deferral of approximately $560,000 in each in each the third and fourth... Read More »
Average Assisted Living Occupancy Falls To New Low
The latest occupancy numbers from NIC are in and hit another low that the industry will be spending months and probably years to rebound from. Perhaps most notably, in the three months ending in August, the assisted living market fell below an average of 80% occupancy for the first time ever, to 79.5%. That is a 60-basis point drop from July’s trailing-three month level, which may have shocked us in the past, but after the nearly 170-basis point fall from June, it could be worse. To be fair, that is just across the 31 Primary Markets that NIC tracks for its quarterly results, but with COVID-19 affecting most localities nationwide and its economic ramifications even more widespread, we... Read More »
What About the MOB M&A Market?
With seniors housing and care transactions slowing to a crawl in light of the COVID-19 pandemic, let’s check in on another healthcare real estate sector that has not seen the same decline. Medical office building (MOB) transactions have been flowing steadily throughout the third quarter, with 11 deals on the books so far according to our M&A database Deal Search Online. Most deals are focused on facilities in the Southeastern region of the United States, such as Alabama, North and South Carolina, and Georgia, and the buyers are a mix of REITs, private real estate investment firms, and developers. So far in the third quarter, over 376,000 square feet of MOBs have been sold, with... Read More »