Genesis Healthcare Disappoints in Fourth Quarter Earnings
The fourth quarter of 2016 was a tough one for Genesis Healthcare, but it appears 2017 will not be any better, according to both management and those in the industry. Metrics were down nearly across the board. Average occupancy fell 40 basis points from the third quarter to 85.1% (that is also 90 basis points down from Q4:15), and the weighted average revenue per day dropped $2 per patient day. The latter was largely caused, according to management, by reduced funding in the state of Texas, particularly in its Upper Payment Limit program. Those factors, among others, resulted in an adjusted fourth quarter EBITDAR of $156.6 million, which was down 2.7% year-over-year and well off consensus... Read More »
Changes already for 2017
Welltower has a management shuffle, and The Ensign Group expands its real estate ownership. Well, first of all, Happy New Year. I am not sure if it is going to be all that happy, bumpy yes, happy, it will depend on your perspective. For the first act of the new Congress to upend their own ethics rules, and then to rescind what they just passed, well, one would think they have more important things to do. Perhaps they are waiting until January 20. Meanwhile, we are heading into a year of uncertainty as well, with the full impact of rising interest rates not felt yet, even though financing activity seemed to take a breather in December. The only big news was that at year-end The Ensign Group... Read More »
Genesis HealthCare, Kindred and Brookdale Working With REITs
It was not easy, but Genesis HealthCare, Kindred Healthcare and Brookdale Senior Living have worked with their REITs to strengthen all concerned. In reviewing the events of the year, I think perhaps the most important ones involve Genesis HealthCare, Kindred Healthcare and Brookdale Senior Living. And, of course, the REITs with close ties to them. With regard to Genesis, I know it took some brass ones for Welltower to work through their various leases with Genesis and sell a large number of the properties. But the important aspect was the reduction of the rents and the smaller annual escalators that will keep Genesis on an upward track. Investors liked it, boosting the share price by 37%... Read More »
No Summer Vacation From Deal Flow
August used to be the month for vacations, but for some, not this year. August is supposed to be a sleepy month. But as soon as I left on a summer vacation, the biggest deal of the year was announced, and we had a series of uneven earnings reports from the few remaining public companies. The large acquisition by Welltower was a bit of a surprise because we thought that deal had died late last year. And it did, a few times. And with a sub-6% in-place cap rate with occupancy for the portfolio so low, Welltower is obviously counting on a change in management to spruce up the cash flow. Great locations yes, but we thought the Big Three were taking a break from the high-priced portfolios. I... Read More »Schedule a demo
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