BKD - Earnings call transcript Q3 2021 | Brookdale Senior Living Inc.

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Operator

Good morning ladies and gentlemen. My name is Harry, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Brookdale Senior Living's Third Quarter Earnings Release Call. All lines on mute.

We will open the lines for questions at the end of the call.

conference be this purposes. for reminder, a call recorded will replay As would the Relations. of turn like over I to MacDonald call now to Kathy Investor

Kathy MacDonald

you, Living. you to XXXX I good call the earnings Senior third quarter Thank welcome Brookdale for and morning. to like

are the All our President today laws. may to are historical statements expressly future. and today, Executive and and President be Baier, securities Executive are be facts, statements differ as of Certain forward-looking statements within meaning we our which the materially the Swain, Vice and Cindy of federal statements. forward-looking deemed may disclaim Chief made These Actual us Chief and in today’s Officer; Joining update Steve Financial performance date, from results statements obligation to any Officer. these not from factors Form reports the earnings the as we of to results could we file measures. the actual Report we please detailed with to the Form in to that on I differ our full as in are XX-Q. SEC risk non-GAAP Annual present this reports quarterly you factors issued XX-K for time well the during call, Harbor that and time, statement. contained yesterday including release direct note the cause the Safe Also, will financial release in on

found which be GAAP direct you X-K I may measure, to an brookdale.com/investor of reconciliations comparable furnished and from non-GAAP our supplemental release most For yesterday. and on information, the measure the was at

to the over call I turn Cindy. will Now

Cindy Baier

now have safe the quarter increased doubled years. with quarter, hope you our success. our at the an growth than long-term call. I of XX we quarter Good to occupancy occupancy analysts for of Kathy. we basis sequential other trend shareholders, quarter more points Combining care month and last Including that XXX least third participants. occupancy In six our the a Welcome third and consecutive largest The the you, our and earnings in of to in third RevPOR. average October, points. you sequentially and all those was building XXXX second robust increase sound. growth increase are occupancy eight basis our Thank growth morning about are and

third the the prior our of we strong quarter. quarter wane RevPAR Even we of X% For wax recovery. continue momentum year and with the continue occupancy was win within of sequential the the growth. With top-line see to positive to pandemic growth

increased Healthcare. health, significant we the to XX% benefit from the our July outpatient retained this business newly In sale business. the our of of to strengthen we more completed of to than continue therapy $XXX as million formed transactions. HCA venture We and several our growth home to hospice In liquidity future top-line recent XX% addition growth by successfully and liquidity from we

September better month The second plans but over final convertible strengthening million closed that deliver notes October end expectations. our offering use My liquidity highlight significantly least executed third than certainly on strong $XXX was allowed is financial the Steve to significant will transaction quarter a proceeds. our subscribed. not highlight, Xst. that us these results move-ins to We

possible the keep regional progress, our that and who leadership appreciate all Our also team Brookdale we several celebrate corporate deliver positions we amazing announced our to diligent for long-term teams support so promotions. of the which XXxX I work success. our can efforts that engaged. financial of and key Recently are because community results efforts, and help positive residents dedicated only team safe our

Division President Senior internal served was we track organization. Kevin was succession has closely and Ricci, his Brookdale leads business for well of with levels has the positive organization. and the operational excited Vice Community the grow Laura is impacts. this with of on combined We Living Bowman nearly expertise Due Division his direct to the XX development West ground Living her by number of Executive Kevin's from brings reports at as our as We recently thank executed I'm Living new pleased promoted years have role EVP expertise running range of XX-year leaders President. and and a talent. multiple Living of Vice of wide XX Senior leadership as Senior under the previous experience to developing residents previous another Kevin Senior already Vice Fischer West depth Ben plan Laura seasoned position within veteran associates lead in of will to Kent Division experience our Operations. experience record Living trio. Cindy Senior talent that with years promoted Senior of years of hit work most He his who and promoted within leadership power position XX to [ph] am President Living of East made regarded a to leadership the the operation one and He President. operational for contributions see a this operations Community to Vice a With President. Operations, his Brookdale. servant and to I

the protect vaccine help teams residents. our shot booster further in Turning our preparing to our .Well an COVID-XX approval strategy were of update CDC's clinic for to clinics on advance

initial and As clinics, with teams clinical administrative did a tremendous our vaccine the job.

communities. when the communities hosted of booster COVID-XX several Friday in had the by booster was approved and We successfully following booster clinics. a of vast flu clinics For officially on majority our Monday our Pfizer our shot started the example,

protect up to this residents, Our one our our and important I'm that shot. and communities. We others. health associates their care and effort professionals eligible into least targeted those associates our they The completion when prospects deadline. stepped help leading of associates are high and this way accomplishment families, at help are vaccinated. seniors for grateful our are our received get vaccine And do our the residents since this associates step that taking to move Over to XX% acceptance have rate a expect have in important themselves know before is very protect associates in more communities believe vaccinations. both apt their us to part to our is COVID-XX residents, also

Now basis. a XXX turning community Industry with quarter. The reported Senior by basis remarks third quarter points the points related basis. for NIC Housing financial to grew growth growth stabilized third occupancy as XXX of occupancy Brookdale's on on sequential same a faster I'm basis pleased showed

quarter of last XX% winter, had of smaller our communities around our the pandemic a occupancy in the Our the population. than the are outstanding because residents vaccinated. wave increase general light is Within delta third in in challenge fully variant delta impact

pleased independent segment We are largest occupancy that accelerated Sequential also business. growth living quarterly results. in growth we assisted segment in memory our our strong occupancy in occupancy living care continued delivered deliver every sequential to of

transformation marketing and we move-ins, as deliver helped to achieve move-in row. strategy a accelerated The operations and and us performance sales, outpace the improved to marketing of that occupancy continued strengthened Our conversion quarter in benefits investments the for ratios second industry and our commitment team process. sales visit closing the gains

the to This normal the three-year progress move-in levels our of on road with from XXXX. exceeding recovery. are XXX% firmly addition to average demonstrates XXXX historical recovery that we September In exceeded

expenses. to Turning operating

mainly last labor. be As in driven expected by we third our call, quarter we highlighted earnings higher expenses would

across competitive results many industries. intensely demonstrate labor seen market Our the

performance surgeries, We or positive about leadership they need retention hours, nursing been they their to and with EDs community and of hires roles elective staff XX% have remained of Brookdale years. enough are two-thirds and labor our the they in our an in than two environment become for reducing our new restaurants executive news get which daily EDs is important in reducing drive directors of helps community environment rate The training don't service intense pleased have around enough don't that workers. their communities. can stability more that The have members provides because our the hospitals because

critical reducing Brookdale. aren't eliminating for services However, or hours options

the business labor in talent to and the high year. are required a and people key trends. through market Because challenges. we still services other our growth. days overtime labor occupancy were to work open the we operating taking fill is quarter use expect competitive the positions to of to expense maintain of be continue support XXX provide the will will We and Hiring third clock, a people Steve our transitory intensity to seasonal around priority. contract expensive details I to normal of the fierce including wars quality care

our on It I'd noteworthy is of through we financial Before pandemic to the guidance. began practices is are to I the the we outlook. gain since the we call to outlook that over normal return our turn COVID-XX fourth pandemic. pandemic to the as this early days committed first the quarter on time confidence comment In that our Steve, providing like path

return today next to and We annual providing quarter fourth are to providing guidance guidance year. expect

sequential adjusted rate. call and care every the growth I'll service continue will the growth and momentum engaging, entering drive and developing possible have turn providing drive over quality the sequential to resident associates. a getting quarter long-term at personalized best and We the and expect now occupancy on strongest EBITDA high Earning retaining by Steve. and focus trust higher family To the priorities, we attracting, to recovery basis. win three service on available fourth valued in room

Steve Swain

results. key There Cindy. our three Thanks to are financial takeaways related

within X% year-over-year of am I quarter RevPAR. the prior First pleased that quarter. was year third RevPAR

industry's the a occupancy the sequential sequential strong discipline occupancy continued made driving basis. are outpaced growth quarterly price this addition, on In gains forward. with year we The we've business

sizable mentioned. operating EBITDA The Sequentially G&A sequentially. And expenses, Second, Healthcare labor X% HCA the resulting helped of the from savings liquidity. third, community mitigate higher a adjusted Cindy transaction increased expenses. portion

with sheet throughout the and balance taken liquidity. pandemic the enhance our to We pleased are we've fortify actions

This HCA $XXX the was which the our quarter. were than of With in transaction recently And proactive first completion million refinancing million increased in raise third significantly we capital issued the liquidity oversubscribed. step plan. more convertible the of $XXX nodes

which step refinance the maturities, will a first later. second be quarter XXXX I'll to The discuss bit

same prior rate higher revenue and was year-to-date RevPOR provide me quarter for community these or year both the on X% let a more than starting highlights a basis. Now with basis. context on than

discipline. close see this pandemic-related targeted We discounting we In overall used quarter to was this necessary rate continued third in basis. RevPOR where on lease-up quarter the a discounting during turning with rate on Consistent basis. RevPAR period. remain we a to while industry third Combining to maintaining competitive, third the were quarter occupancy lower with positive growth strategy year-over-year the sequential slightly

year-over-year CCRC In delivered revenue segment growth. fact the

fill higher Turning labor community to labor sequential to basis mostly contract used On a the difficult and overtime was positions. open due to labor expenses. We expense operating market.

the Besides increase expenses operating such higher sequentially increases In addition, as in there costs from third were day to other seasonal due sequential work an seasonal facility and costs extra labor quarter. holiday utilities. labor regular

based $XX with third year-over-year stock healthcare the year than non-cash to the impact G&A million Ventas was was to in organizational negative $XXX associates was transaction and $X excluding cash XXXX. primarily related year payment For quarter the prior XX% This expense pandemic's excluding and excluding and third million July The one-time cash of $XX the million compared of the this quarter lower million than XXXX. in Xst. the services Ventas $XX quarter free quarter. quarter prior million of the compared in who the for one-time X% period transitioned of second quarter to prior payment XXXX to comp, the change. third third Healthcare quarter Adjusted year business HCA effective flow EBITDA the the the costs driver major restructuring was was XXXX lower Adjusted the

EBITDA In to year mainly program. $XX change the Cares from change cash other approximately of large the in free by deferral adjusted addition Act. million the tax was year flow payroll year We driver adjusted over last to due the the in benefited

Turning to non-development CapEx.

quarter The the XXXX quarter, additional was CapEx were receiving completed. landlord as second slightly third in due prior the the quarter certain than higher projects compared to reimbursements year decreased to third quarter

to the Turning key third liquidity. highlight

let $XXX proceeds benefit me September As share net guidance. from quarter transaction. liquidity $XXX total context HCA the quarter second third was fourth for main was of Pivoting our the The from higher than of million, million XXth, results Healthcare the quarter. the end

by pandemic variant are wave Housing delta caused explore prospects the we As seeing Senior options. the fourth subsides

to patients For example, new healthcare XX% in research referring their professionals Living. of feel Senior confident

occupancy the sequential includes which results around and expect relatively normal trends October We growth holidays. seasonal anticipates

sequential as to growth drive we the adjusted occupancy higher year. close EBITDA expect We

capped meaningful million diversify efficient fourth of notes Xst closed We The a Turning to dilution. notes received our liquidity sources elements $XXX as carry the on price low the realize key a cash without convertible upside funding share outlook. to us proceeds. capital. October coupon the with They call allow net quarter in cash and and of and serve convertible our

immediately loan plan. high raise With million $XX the off our plan. we only the step touched October. introduction in structure in on first interest the the my of The that of I in In our capital convertible refinancing proceeds notes paid proactive convertible was

which we by approximately To maturities. year will to lower mortgage XXXX debt and with step in quarter of of second $XXX we expect The complete communities plan leverage first thereby approximately end pay off be proceeds. approximately to that refinance to million those using convertible million refinance $XXX million end $XX maturities

Third maturities. be of to rest step our will debt refinance the XXXX

environment appears using dollars early what cash all are we and Given evaluating save negative interest to several remaining million be XXXX to a currently rising carry. of prepay maturities

sources our quarter investor then and expect of refinance we those prepayment with cash leverage unencumbered other consider. In to mortgage uses listed lower communities to this fourth debt. presentation Following would potential we

Turning to CapEx. non-development

invest factors for are quarter. increase the $XX expect quarter. to the in two from We There million the third approximately fourth

variant As is fourth quarter CapEx we we've grants. insight projects. My reimbursement therefore government the to of ebbs to there be support related final growth. the less initiatives delta in the several the Act Cares And quarter. accelerated fourth And completed will majority occupancy landlord-related

provider that second revenue opened of fund the submitted our and We the X was We expense to in XXXX. to related quarter application. efficiently XXXX changes first are the Phase relief pleased and quickly half submit and

health all determine will funding current Our to applications formula and is understanding services human making review payments. before the

Phase process that great have have of but top our and the this fourth for priority. not residents X fourth path quarter any We we'll we year, because included lengthy are I look cautiously associates expectations potentially in the this With outlook. I our relief as optimistic receive ahead. our payment quarter beyond horizon When

years. growth EBITDA is Our the next potential immense over few

supply we've with million units With one least XXXX. to with opportunity expansion. eight back and growth entering tailwind. significant growth. is to over XXXX Cindy. the industry, in under target new rapidly top have is since construction occupancy significant encouraging seniors The now market particular every more past recovery that Even call the a the at primed increasing for fewest line over delivered Demand there through the than I year we is turn future months, a will still both for senior living Brookdale the margin

Cindy Baier

perspective associates corporate keep our I and we've their of I'm help associates. senior success. our look number Thank inspired is one you, us efforts Steve. our The top residents to to a continued everyday the priority. community in health I by choice and COVID-XX, always our and from made Their housing. pleased from our well-being the and onset with financial progress organization and heroes am business since dedicated across forward entire of the efforts

our position for near to continued future. order steps to Operator, you. beyond and to sharing open firm I significant to strength line improve taken have And a forward to us weathering questions. of in future growth. the progress go just liquidity support Thank operations in the today. to the please you our storm accelerate setting foundation We joining for and look Thank Brookdale our into the advance

Operator

from question Cindy. Tao you, your from you'd like proceed will open [Operator with Tao is Thank your Instructions] now Stifel. question. first be Our to line Qiu if

Tao Qiu

Hi, good the on road the Congrats booster clinics. of morning. fast

the So I bit into a wanted dive first guidance. to XQ little

million. $X.X sequential million I increase $X.X think maybe to a suggests of it

understand to there. wanted the Just on a bit assumptions more

occupancy EBITDA, I but acknowledge think, gross that seasonality. you adjusted to mentioned normal also Steve expect you drive higher

side fourth low either guidance? think assumption range in any OpEx the on that and or end high of are of the And any of get cost to would how end about quarter? So side G&A efficiencies should we occupancy that you the the the there

Cindy Baier

Tao, for and so thank your you much questions. good morning

vaccine excited that on We are making so progress our the we're about COVID-XX clinics.

Our to team completed. your outlook. our working the is clinics get on answer clock just will last literally the questions around Seve

Steve Swain

Morning Yep. Tao.

sequential that So, normal first do we provided and the An holidays. since you're we've the trends excited anticipates which growth kind the This occupancy, time seasonal started, right. about. expect we're of around is pandemic guidance the occupancy

continue and do occupancy kind in provide each growth small the have occupancy revenue and XXXX. already you relatively quarter occupancy six rest to of we'll month of the to we updates months through out growth books of November considering occupancy the Now four But that of of the quarter model. rate kind you even growth. December, can to the in from just Rate will fourth get ticking third I for

which we're higher We expect challenging, on then a And QX. to expenses, environment lower sequential competitive expenses still basis. to labor be be rate slightly flattish to we slightly and expect in labor a is in

to transitory said, green we shoots be Now and to regard. the some labor competitive that starting we're do environment see early in that believe

do higher to through that will growth to slightly So NOI occupancy of G&A. kind better flattish EBITDA fall and to if EBITDA, we expect assume sequential drive net-net, higher you then

Tao Qiu

Thank you.

And understand Just Are you are markets that the little there. the the be on those bit agency a have a more or differences that wanted do benefits seeing bit using normalize ended to fourth to where terms labor than in time dynamics and have expect your quarter, too? unemployment supplemental of that little over in XQ would that there not. any you higher

Cindy Baier

sitting market good put is Yes. could that really hourly providing of Those is in or positions. There's they in information the actively our interview. sort home worker really challenges supplemental working. for in supplemental applications. staff, cases we the as business unemployment federal What a economy we interview question intensely increase seeing what many after the We the for labor lot pressure the sort competitive that of are an federal couch a pervasive. than saw ghosting no ended nursing in as in and on of the of But well saw on could people are throughout an make saw up pressure questions. showing pretty unemployment is fewer And their not the terms in just accurate us is not we're more

responding wages to very necessary remain this and dynamic competitive. to we're So, actively appropriately. reviewing labor adjusting them We're market where

reduce labor a we those Now we to that we the and going belief be in fourth and see to do contract as bit do still elevated expect But time is quarter. able take this our of little will being overtime. it's to

at if we've sort hourly our look progress made I turnover the from peak. positions, Now and of

October. improvement So September we and improvement into in saw continued that

unemployment are a but I So the just talent. bit And there's our in some to believe seeing pressure smaller been little more urban we of of do us. that pool helpful has rolling markets benefits rural in off markets, a

Tao Qiu

you. Got X.X%. benefits from question final expected me. And one your security seeing is We're residents for grow to social

highest the do the to feel rates can that's growth January if XXXX. pass think increases? cost your you I existing Hopefully since the you How Thank coming some on ability about on you. of raise residence.

Cindy Baier

Yes. There think rates. will help increase are factors that three us I

which our that's seeing one checks, I are seniors in is important. think their mentioned you've monthly security social increases

the I push care way to more a need happens the labor, resident much think is pay taking cost industry when convince is it people with increase it's we're to that necessary to the who easiest around in are to then you that second the to rate. easier pressures of that that and them. rate finally firm the third them seeing is up. And occupancy a explain to And

help first January increase increases. things we us that into key And factors go as those will rates rate so, our our are three

Tao Qiu

That's great. color. Thanks for the

Cindy Baier

so Tao. much, Thanks

Operator

you, Thank Tao.

from Research. Nephron Please Raskin Josh proceed. line now is is question your from Josh Our next open.

Josh Raskin

Thank you.

Cindy Baier

Good morning, Josh.

Josh Raskin

or your guess verse very What I little bit Cindy. facility assume does I And labor? there's of percentage expenses care. operating are memory IL much that there? AL a morning, more Good

Cindy Baier

Yes.

labor care Steve, and not because you in that more question care continuum percentage in talk from percentage model. to either personal to level there. about the AL and the hospitality that IL really care. of got a And labor, assisted in step care same have want memory expect labor would to you AL there's the lowest you memory has raised. have Josh a as you up you've the from little it's that bit As in living IL, you more of And then

Steve Swain

Yep.

Generally Josh. OpEx. as it's percentage of in the XX% XX% range, kind labor bet You XX% range speaking of total a to

trends can labor CCRC you where supplement of on break Now, the there. separate you'll IL, out see and expense that we the various see and from OpEx AL page XX

Josh Raskin

next stuff. anecdotal Perfect. And year mentioned six then that you in demand steps are developers you what more typically point, are think to construction? there's signs elicits am think there do I lows specific coming that back there any the looking kind I are? curious Because But to markets. and for that construction and if of that discussions of Do sort be seems you your and think

Cindy Baier

and I'm ook lower and I are If it really industry they're Brookdale, at Yes. the down about around than for Brookdale our excited is what XX% at of sort starts the communities peak. [ph]

think if I years. supply value for incredibly of make that which us inflation that target will the think projects and so in preventing and you a presents the to disruptions on the labor being their labor and pressures and for that's that that we community tailwind with also that us is it get also The a think harder new I from completed. up a building are seeing for is cost few delivered sort chain is for workers And seeing that single of inflation portfolio, about do already day work. the to pre-existing the every going basis good having materials do something we're next of timely of in. some priced Because we're

So favor think to all future. play tailwind the our for are things the of I to strengthen those going and

Josh Raskin

you. that staff Got construction about well. component I labor makes really the and sense. facility got thought they've of That then the as obviously to hadn't

in XX% a eligible the heard I two terms outs? eligible vaccinated but there's couple data for a heard where of for at of do then of what hold communities XX%, point couple curious rates versus success a I And or you highly little heard I I'm down means? ones then that sort quarters just move-in numbers. bit. a vaccines, close on lastly have now And employees. rates maybe this So we're employees out slows things or a then

Cindy Baier

Yes.

of saying that's very -- small of in resident out the by population associates. percentage people over start just eligible of when morning XX% as before that already means exemption. this checked residents and of take came what of have XX% or me who I is is And the was it approved Let XX% an I medical the we a XXX% religious

finishing apply that just of the vaccine are last we're to ahead XXX that grateful over government a So the stages over workers workers. requirements our We're of mandate. we hundred or companies with

we're So Residents for relates share been the appreciation and a say I our numbers and is vaccine think good vaccinated we've in But can What don't as I that that mandate to great is our I for for an have us. mandate. to associates. you. with specific residents vaccine it shape seen have that's good prospects. highly communities

Josh Raskin

exemption? eligible And in through to or are What you. employees. medical not the sorry percentage the religious Got your squeeze I'm of list. XX% the eligible employees But of

Cindy Baier

It's a very, very very percentage, small small.

Josh Raskin

Okay.

Cindy Baier

Thank you.

Operator

Thank much, you very Josh.

of from if is Brian your line to question. with you'd proceed Jefferies. Our Brian question next your open Tanquilut like now is

Cindy Baier

Good Brian. morning,

Brian Tanquilut

seeing guess for rates strategically RevPOR and the in held you, more your I philosophically just Good question the QX. knowing sequentially time longest ground my on morning. for decline you've Cindy or or

one-quarter thinking or aberration more how there should price this to holding we is your the a if thoughts ability shift be dynamic hear Just in wanting thinking your and is interest to a or that. trend? going of in forward if about this on

Cindy Baier

it's think in a all don't strategy. shift at I Yes.

between every possible. that is always to we do get in driving at occupancy however rate. balance What is rate unit strategy the driving fine service Our a there's recognize strongest and

it And environment to competitive occupancy. discount use to be very so, a if is that an in necessary you're may grow

has we've prospects of seen the what because so, bit also but of living of industry, had in more it little to had is the a a sort coming disruption stay. it portion higher independent length had occupancy that are longer And particular in that

highest drive the to discount So as try we we've the always per targeted available a quarter can so that been about to use possible very room. revenue in third when

Brian Tanquilut

or now to horse to be is then or Got the And want staffing. time? driven the nice has a you it. inflated bonus a be using normalized artificially about like here. don't that do reset more to of I dead that a right the structure thing this is think kind should this But cost revert baseline kind back number temporary know level over of and

Cindy Baier

I think some it about to Steve things it. when and add will So,

think in in that it. the will be of contract base a of some has that I in that I one workers than I wage, that offset hourly variables things think XXXX. do wage labor. And rate is lot But think will is number And are XXXX there the in it the higher part higher increase.

it or put we it special the restarting. just more used was our disruption have of contract pressures resident the extra whether clinics by on care because than of caused it We the team labor in whether have, XXXX was areas historically the because COVID-XX whether economy was vaccination the

hours XXXX. and happening to labor that fewer we'll XXXX turnover in back historical to that to there's will and the relative I think quarter higher underneath bringing number. training get And retention lot I But second grow with a first contract we from hours. we to part people quarter So training net-net board. turnover to being caused our retention that's But third us driven do use labor really our of more things that and a in overtime. have -- have on think the the for that also new that back if lot comes of that norms just our

Brian Tanquilut

able guidance, for since mean, without will Brookdale labor in then you. giving I next do me. Got XXXX takes to last the for year be you expectation XXXX? With And you puts all question and think grow EBITDA that your versus called out

Steve Swain

Brian. morning, Good

as we've due RevPOR to inflationary the gave to go, Cindy But three guidance have So our that give occupancy, increase partially discussed why we it labor run in, which should higher expect expected expect We is market. mentioned already by than do XXXX. said, the a top the wage do giving and you mentioned is increase ways means, expense, we we've we rate. without that. That some lower far believe already just pressure offset Cindy expenses to And can reflect be average contract the grow will XXXX. be rate really tight to transitory. expect that to we're reasons of in for in as to labor I you expense environment as we labor which

you So a guidance. expect do more puts we of XXXX. course, and give on XXXX a increase of in but EBITDA In I'll months, few lot takes, to details the

Cindy Baier

that just said. little Brian, But out a NIC should context behind attend seems with the have pretty like this industry add have it, say. bit their to I didn't of a the of to earlier week. for XXXX lot in reasons about need Fall wide-spread higher was than increases just I And labor. traditionally including articles Conference Yes. Steve have a of came rate out they there it discussion

I rate the sort don't we're environment increase in people think in. of XXXX So, operating we're to thinking of that about how only given the

Brian Tanquilut

guys. you Thank Awesome.

Cindy Baier

Thanks Brian.

Operator

Thank you, Brian.

from question now line proceed. is Barclays. Our Steven is Steve Please your next from open. Valiquette

Cindy Baier

Steven. morning, Good

Steve Valiquette

Good morning Good everybody. morning.

the anyway. want to last every surprised critical topics question by I your touched in around XXXX. I hit kind I pressure here industry of just think touch at on rate then in on. having comments But this the on follow-up point what still including was that

accuracy is of assets six there rates for already a we've You a touched across could I If XXXX. I in end been XXXX in price is There's just industry. all occupancy change? thought of up the renewals And made right is, XXXX of process the of least that better already? My to sea from month the about That's down question really a the my firming sets bit mentality setting the firming no more guess, for was rate operators increases calendar fine. that and question is cetera. change et be there be now environment that at a sense sort then, which this. maybe calendar just Could thought you've seen for little comment when at direct industry there for be kind day is already. that there. would've that irrational up would

now XXXX. right you this for be RevPAR for on XXXX Thanks. would think number What put right the predict that to industry industry? housing you had XXXX what senior growth you will now range versus in If

Cindy Baier

had. there's have because because environment is occupancy least That rate. The there the the is reason optimistic I'm strong have is will better XXXX. optimistic grow. about are is growth direct have I'll occupancy lower Quite of we a question. the than environment in say I'm traditionally do a I there's will What million potential is occupancy very supply. that And honestly, because believe industry And above The supply next customers at demand that in year reasons to a new average a think RevPAR lot starting Okay. lot a market. better we growth

our brands competitor in brand For times the Brookdale, by the unaided and mentions high, our awareness J.D. got is two customer we next as awards. got really high closest because Power we satisfaction evidence

the going reasons grow So, to the industry think for in rate talked I all is about. I think that we've occupancy see But also you'll growth.

you strong industry's history. years giving specific So one and a do it number I the growth in of RevPAR best the think I be will XXXX, in expect without

Steve Valiquette

right. That's All helpful. Okay. Thanks.

Cindy Baier

Thanks Steven.

Operator

next from America. Our of question now from Joanna Gajuk is proceed. your Bank open. Please line is Joanna,

Joanna Gajuk

the question here. you taking Thank for

just very the may I and labor if So discussion last staffing. follow-up cost on one a

those about I us we used much better obviously contract higher. can things you compares of [Indiscernible] now your the it terms So, you sounds but to get And magnitude some sense it should you for as kind versus that frame have labor normalizing. labor to of because of kind how its sense to overtime, get the numbers of contract appreciate just a here how much anyway so to labor could think historical, a but of in costs commentary was maybe we degree, think of us

kind So framework those any metrics of would be around helpful?

Cindy Baier

want that to to I XXXX. as there say add morning we can I is is never have to you Good that contract as Joanna's Steve, And anything question? labors that much due earlier. factors in that all Joanna. used we've mentioned

Steve Swain

same normal or Joanna, to bucket labor kind and in hours. kind we the contract bucket that of needs by And of if in replaced regular will. than labor higher overtime the productive

at. during I give up can above labor quarter earnings So just that XXXX that's look for productive look I - coming and more the regular detail a I hours. over of at detail we'll I fourth think less call.

Joanna Gajuk

quantification frame of is it or can costs was makes that of That it sense. X%, any will I -- like any it, XX% in like your terms Okay. you guess labor way be helpful.

thanks So about was we'll guess my into that. look this again. for I early question year other next about talk to CapEx. But

any sounds working year, terms for this framework kind then continue CapEx the also on for budget development expect million But year of anyway or I So non-development CapEx, $XXX it outlook next you was because your in lowered. of CapEx for next that but for year. to you're like understand

into in you are acceleration So you. CapEx? year there of buckets Are either Thank these what pushed next projects out for expecting being these and are projects?

Steve Swain

Joanna. bet You

on the of talk to But So, I XXXX. little that about this I fourth time a more top a remind want on giving everyone of the non-development. CapEx said, Its bit that will kind guidance first is quarter. waves we're the

per CapEx We reimbursements net expect in unit of $XXXX of landlord XXXX. to $XXXX

far development identifying the umbrella we go As kind again, project as come number that as the of still that turn more will under that on projects calendar. the we're CapEx, and to

Joanna Gajuk

All you. right. Thank

Cindy Baier

Joanna. Thanks

Operator

Joanna. you, Thank

Markets. Frank, Our from open. from next now your line Frank RBC Morgan question is Capital is

Cindy Baier

morning, Good Frank.

Frank Morgan

of that? a to I'm any do that reminders when be there that for What maybe early past to on sticking you I'm here great? you able forward. morning. in part color terms that precedence would early thinking of Good of are occupancies in rate in-place, going back occurred would residents. on or of question trying the effect in the been. XXXX you? when cycles. were the first any rates back loss of maybe remember I'm its How any if much kind of or on occupancy could you of look So curious cycles back kind But very XXXXs. were just in have a at my raise -- increases impact have had all early Was the

Cindy Baier

business. say, and resident. rate And have the train what's right What's kind we because to have right our always directors increases Because rate from increase, a increase. increase. trying significant that the to set we're we without is because has don't the for Frank, a whether a Yes. of we what do been see or been very for residents. lot approach in-place we're trying to executive think of rationale, increase rate it’s attrition successful the of of And lower rate fair rate that generally higher along discussion in rate. pretty we I attrition What's for passing consistent about having the

Frank Morgan

where Got a we I on is And the obviously labor seeing, inflation? any in are there guess pickup you. But then back inputs other front side, you're costs know seeing you cost center. and emerging

Steve Swain

Not we've kind the this slightly It going to then, We years a not past labor. the year to boils better Frank. than pressure. any given insurance might just over some of of And is seen season. board, But all hurricane across that. down into couple the it XXXX, different

Cindy Baier

hurricane. I hope it not should over be due yet. It's to quite

Frank Morgan

Got you. to my just issue. And labor around I head trying get contract guess, then this

you're missed Thanks. normal that we down. would structure of of could dollar opportunity think forward? what your Is back that you're maybe kind above sort is kind cost saying, there the any of we of in framework consider this. that that at as comes you be or -- amount you a times terms I In thinking there But of

Cindy Baier

reduction I going growth some we're question offset seeing into think Good should labor Frank. that of thing the that labor contract to is important its offset from XXXX. -- wage pressure the

Frank Morgan

you. Thank

Cindy Baier

Okay. are. don't Are there there think questions. I any more

thank has concludes to And and very that forward call. your to talking want interest our I everyone conference call much joining look we hope to for soon. all you in for weekend. today Brookdale. wonderful So a I our That

Operator

may And today’s conference. now you concludes This disconnect your lines.

Brookdale Senior Living (BKD) 5 Nov 212021 Q3 Earnings call transcript