VTR - Earnings call transcript Q1 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Ventas First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your first speaker today, Sarah Whitford, Director of Investor Relations. Please go ahead.

Sarah Whitford

to first welcome conference financial and call. morning, the quarter Ventas results Good we quarter our and this issued Earlier morning, first investor earnings presentation. supplemental release, ir.ventasreit.com. These are available the website materials on at Ventas

include As forward-looking to a and matters. other made reminder, today COVID-XX statements, certain expectations remarks including related may

factors from are risks those such of contemplated statements actual results and a and by Forward-looking cause uncertainties, to subject variety to may differ materially statements.

and release to of those most factors, refer for more this all a earnings quarter website. Certain filings, available detailed discussion SEC will non-GAAP For are financial this on on our call. discussed Ventas to recent please which measures our of be also the

to I Debra A. For the Investor on comparable most to the closely please will call section over and supplemental Chairman a measures GAAP our of now posted reconciliation Relations of turn website. the CEO. refer these Cafaro, measures, to our

Debra A. Cafaro

our participants, earnings the Thank all good morning And to of call. first other shareholders Ventas you, and to welcome quarter Sarah. and XXXX

me and environment outlook important us. and an believe have of turned by the corner the macro saying Let the pandemic is Ventas worst the behind that that we start

health and of and classes, for wellbeing their capturing reiterate include maintaining investing sustained of significant no also it’s operational senior asset smart Ventas taking though and caregivers, feels housing optimism. our words, portfolio, it You we embedded win I making important gratitude capital the recovery. on and widespread capital, efficacy to our the how the in and The dramatically COVID-XX and the financial to decisions, attractive administration The team focusing steps economic also upside laid stakeholders. in excellence acquisition and remains. flexibility. to value-creating those steps have recognize portfolio benefited development foundation across diverse, our think demographically-driven say residents idea have is These good actively in initiatives, our that vaccines opportunities uncertainty high-quality whole even engaged strength our and for allocation and senior attracting recovery and

trends first fallen Let a confirmed person to move-ins me have With And literally and cases have out per all now SHOP a report communities XX,XXX. are health and results. I’m day new address single resident population most senior respect thrilled that in our to housing expanded reintroduced open activities. to new safety, resident communal and visitation to of our and of

in natural, our living occupancy XXX in through the community, nearly resilient growth, result, SHOP a bottom and for the April of revised, we’ve basis XXX our As SHOP demand mid-March. has portfolio reached occupancy then, points XX%. demographically-based which Since we XXth to spot led grew senior cyclical basis pandemic posted by SHOP points and U.S.

start tempered growth over occupancy those the Canadian XX%, has portfolio, of because Our measures which U.S. maintained clinical full expect SHOP the portfolio, exceeded since do consecutive occupancy conditions Canadian currently and to in over the were those We lagging regulatory move-in SHOP the the SHOP are catch move-ins for two April time. first the pandemic. pre-pandemic and of levels whole March months both, up and Notably, when move-outs

In April time move-ins any since single June during at totaled a month we’ve than X,XXX fact, more move-ins in experienced XXXX. at

first of also are quarter did benefit these with we trends in pleased many began positive fully first results, the While results. quarter and not therefore those

million for of facilitating is providers healthier population, housing seeing of and The per occupancy crucial reported longer, are participants came resilient for we demand the by lives the portion this again which validates communities SHOP And in share ahead expectations. gains FFO above care SHOP date. play need-based normalized the once our quarter nature and to senior other robust and were those or our at of in supply our X first role the market favorable. a demographic Our performance nation’s Supply over next high and This senior as by housing of value-creation in describe, quality favorable few us constrained highly housing individuals growing our Justin recovery, of grow trends demand are creates which our combination to The years. over also opportunity backdrop senior NOI just well-positioned set will realize shareholders. portfolio, senior upside. an incredibly housing represents makes and significant to for for recapture this

those we our Turning through the to dispositions our approach, this in property about year, ability to to half of our $X enhance enterprise. capital allocation and are billion of are confident expected second recycle

Ventas to On science, is three the and innovation five million which life business to affiliated the the is with capital. feet, research of now with side, The over portfolio, exceeds research and X nation’s XX in top investment cluster universities. invest opportunities our continues square of us value-creating top markets attractive provide located

purchased the the of life in we our through foot. this Medical, U.S., research have We billion $XXX of a in behind and that Hopkins This sciences A Hopkins and leverages universities, recently our just by projects and funding. right an assets We life a which the project in in investing academic Located acquisition is are We life science ground-up valuation look on currently research which more our anchored active largest to nearly science investment our of $X pipeline of major government development in universities, you, at in business potential number four in with expanded and fourth in at another with Class cluster square also the attractive recipient billion And affiliated expertise research totaled medicine later $X also year. the science, exciting developments delivered forward per innovation, life I’m portfolio pleased developments global medicine. report life unique information intersection sharing underway. we one to our and costs. leader sciences Johns

capital LGM financial Groupe in Le brand, Quebec. a housing senior in In success. addition, we model first-class our product to with continue Maurice invest maintains partner, and for

the in with opened fourth most two quarter have occupancy. recently XX% Our achieved LGM and communities already completed high-end

project nearly aggregate in with We have LGM, costs. million $XXX developments representing three additional underway

Looking $XX opportunities. investment at a is broader team market, deal investment year, volume toward in typical reviews deal normalized billion again our levels. trending the In over

asset of pipeline across and active on from our standpoint. growth potential are our front classes and foot Our we growing, an investments external is

to a to liquidity wide of deals. access sources and have We significant fund array capital

philosophy for our be growing asset closing, downside and and square asset Our ultimate position unit, market flow such reliable positive. Ventas turned for the favorable classes driven per focused account thesis important as on firmly continues flow appreciation. improvement. and trajectory cost cash taking The to of for investment and growth pointing footer asset return, risk-adjusted metrics potential cash are protection factors into and meaningful demographically is of And showing investment key business, and believe an we business corner. in positive our we’ve In all

team environment. Ventas, and happy at As shown about we’re strength upswing stability the we’ve operating and and the a really economic, clinical in recent

an stakeholders, the all taking our for win steps so. we right Thank the have commitment to confident you. recovery are We and we’re abiding to do

Justin. to Now

Justin Hutchens

very Thank senior Debbie. underway. is I you, recovery that housing am excited

As offering in communities before, will we’ve the of mentioned be our lifestyle indicator a performance. leading

dining services activities relatives, coming Now and are that vaccines the open our have should visitation back are of been for underlying all from picking is our up again, demand to to communities continue executed, strengthen. communal

to the recently, coming their by have life and communities compelling is are communities visited employees residents, again. as relatives expressed enthusiasm we back As literally

leading in our and with Debbie pleased we and the indicators performance in XXX move-out noted, in April move-ins, and in occupancy as move-in XXX respectively. improvement As March net are resulted

to levels population "turn refer from We combination netting percentage with a projected a the be the personal due that move-out we rate to benefit move-outs as resident rate, lower time, resurgence XXXX sources, that, to well performed the and than expect as simply high-converting see in lower occupancy and from That, XXXX and effect. of started use move-outs scenario, the include both at levels. of Having XXXX respites occupancy this this to levels, benefiting this improvements resident a referrals. we current said structural as I while outcome pre-pandemic where lower than which a March the levels. gains. lead run XXXX get we results lights the baseline, percentage above positive is April, occupancy on" move-in apply from to move-in lower net occupancy, to return the in If the same current

sources continue rates to move-in referrals see we As professional grow. these could recover, and lead

Construction on outlook. the lower to in to quarter to and and the translate Moving drivers. of first in and macro XXXX. quarter starts fourth should first XXXX the peak supply deliveries starts We materially in remain demand continued on quarter XXXX, our from XXXX. were optimistic level the lowest long-term since into down XX% Fewer of decelerate the

double my to the the XX-plus grow to expect In support next provide years, When on tailwinds assess I the witnessed more our five I’ll priorities over year than financial crisis. strong of one is following joined addition, the for just population during portfolio. Ventas we quality over XX% expected of was the five-year first a occupancy growth. our rate overall The portfolio. demographic recovery to comment SHOP ago,

pleased we independent diversified range of we benefit and I’m visiting active assisted that and Now well-invested, living, an again memory from living, to service communities social portfolio communities, care. housing a living verify that senior adult, highly traveling from are market-leading with assisted and offerings

income offering. to well markets substantial located our high-barrier demographics in are wealth support have We that and

of respective uniquely positioned they NOI SHOP our markets. Sunrise are on within stabilized primary Groupe XX% each Le three competitive Our basis. Maurice, operators, and for Atria, their be Collectively, a account to

pursuing these of position strategic developments housing. to transitioning in and portfolio our moving With a actively strong we attributes communities, through reviewing are opportunities market optimize CapEx in to investment, mind, our high-quality forward, maintain pruning, new acquisitions new portfolio senior

Moving on to triple-net senior housing.

measures senior and April. with continue of cash first we other portion proactive portfolio in resources, the additionally pay, addressed taken Ventas housing expected, as rent. last received tenants and tenant the and our substantial government where paired Given all its quarter triple-net expected to through of subsidies a year our

should operators. and exciting senior XX for recovery senior to high-quality the in for leading quarter in period prior the arrears, our our times confidence which housing, Our call the strong enthusiasm I’ll high expressing communities have our of flow I versus one by X.X is a stable I’ll of quarter. very around summarize sector. trailing reported indicators, to hand in housing is portfolio With compete a and ability what that, cash coverage be Pete.

Peter Bulgarelli

Ventas’ and NOI. Thanks, office produce Justin. continue these health and I’ll results. They to XX% Together, solid over of care reliable segments cover segments. represent triple-net the

office an This First, tempered cash XX Core sequentially. ex lower by million basis-point delivered were I’ll cover in growth. The $XXX to Those parking, portfolio pleased All-in, of same-store I’m sequential which the say activity, year-on-year first quarter. materially office and X.X% increasing. represents core parking office X.X% well. the performed NOI portfolio, results reported office. grew is

our our of companies. our rent April. rated of and creditworthy continued directly and the nature during portfolio, our quarter record the and our rated comes outstanding by office high-quality terms our record strong In investment-grade XX% into portfolio, XX% from enabled medical This collections, portfolio tenancy. NOI In is mission-critical life revenues organizations of publicly of traded investment-grade from sciences tenants come HCA. our In and

and surgery activity of clinical rebounding. are care All locations MOB to building properties in in provides clinical decisions. utilization restriction-free confidence health is our executives making and elective rebound business A

that estate We’re certainly real the on side. seeing

the win for XXX,XXX for As southeast. months. by college. extended XX-year quarter to example. for expansion foot relocated addition the system of occupancy million a an a foot total is quarter. flat, points XXX,XXX bolster of year-on-year. square result down In number third-party was essentially we our new feet In third-party the XX% the office leasing coverage. brokers accommodate leases had in the and the the XX% hired for on marketing care-focused for of This leasing. only Ventas. retention a in example, sequentially a brokers. offices first MOB college leasing. to several nearly leasing square of results. The retention, both the stayed Medical of head Driven this XXXX, campus And redeployed Previous health are X square level technical square Midwestern And quarter, we health XX% feet in foot The XX,XXX XX hired XX,XXX and with includes we basis will the a local increased XXXX, and digital a system, on XX% office In XXXX, to renewal and with of a XX we by July, XXXX, health record are hospital impact negotiations that showing actions leading finishing another trailing the commence lead. We we square a clearly

than was market escalator marketing the exceeded months escalators digital XXXX average our awareness making X.X Our leasing term local vacant on in-place fully for in X X.X%, length than higher difference. years, was program Average averages. X.X%. new term new suites leases and higher touring virtual focused for also place is average. length of of of a Average XXXX and Renewal

the about All million like confidence suites. in-place We’ve The suite and pilot invested space. fantastic. community of on expand we have enthusiastic later a this of our and the of office over results, leasing. physician difficult Because suite a return also where in business have take is XX R&I particularly $X this future improvements in this these a or year. highlight driven XX% pre-leasing care investment to initiative. standard program advance vacant of and created potential it I’d represents Core XX projects investment. to and across growing been points These This Shell a opportunities the basis remain results in nearly occupancy health We hospital to intend we to this either is recovery. construction demolish complete the visualize where in

and science driven to between to Nursing make Philadelphia submarket opportunities occupancy We’ve the the And asset, renewed acquisition pipeline of our have pre-leasing XXX%. announced have that is The in Arizona in the is Penn South projects sciences Francisco activity. has San exceeded College We several of we newest our we soon life of occupancy. tenants Pittsburgh leased. for quarter Baltimore, In cases, Drexel with project, recently four far and Demand billion the life Drexel which mark-to-market fourth University State of Wexford. uCity immunotherapy Philadelphia $X thriving leased. the to some of XX% partnership our Since strong pipeline, showing and is XXX% Campus Phoenix, negotiations University XXX% trophy in with the in lease our in on on continue preleased. development announced progress in At to opened take to Johns acquisition XX%. in XX% buildings over capacity. XX% new Hopkins University exceeds our be are the publicly in current from is development

Now, turn net. care let’s to health triple

health quarter, the health and coverage in and sequential strength Acute During to quarter, improved Census all care XXX% improvement. a year-end a continued May. sequentially strong reliability showed has improved our Ardent Trailing the extremely in April cash continued this X.X times IRF EBITDARM first XX of results first dynamic and XX-month funding. quarter. assets coverage high classes. coverage times buoyed in quarter, hospitals’ triple-net flow care fourth collections business market. basis-point was through performed our for points well X.X with care and by XX/XX the trailing XX into triple-net LTAC XX-month rent at in government first strong basis the levels were and asset

to been complex has health in treating respiratory Kindred period, this able During to partners. system their demonstrate their disorders expertise

is it portfolio, current. loan our Regarding fully

are and thanks to have our They this who Finally, frontline facilities safe our of heroes. word last year. a our workers open kept during

and I’ll peace turn the in their We over mind of Bob. protected are they With with can safety. to the relieved call do that vaccine, now, by jobs that,

Bob Probst

remarks our I’ll quarter balance first recent of activities. for quarter cover my liquidity, expectations the our results, In XXXX today, our second and and sheet Pete. Thanks capital

the was first Normalized results $X.XX. transferred start operations $X.XX of net sale. the quarter quarter. minus held our share, in a noncash by first range assets $X.XX driven $X.XX versus first income share, our quarter Let’s with high to prior per in beat Ventas of funds we for the charges reported in $X.XX as to of guidance from the quarter per end

HHS in grants, and $X.XX. these share received FFO previously our range, Adjusted QX. Grants in was $X.XX communicated we SHOP per QX guidance in As in included QX for

QX contributed operating SHOP. As and driven outperformance expected, triple-net lower-than-expected occupancy better in by the expenses and first was quarter. performance NOI in sequential stable office

SHOP the As a first. same-store X% by declined result, sequentially in quarter NOI second versus the

QX our guidance. to Turning

$X.XX income Second quarter share. to is to estimated net fully flat range from per diluted

the guidance due as periods. higher SHOP QX an improvement follows. to revenue Our XXX Grants trajectory, first $X.XX with both sequentially underlying after SHOP for to range through for $X.XX share. for assumptions guidance Key Starting is spot basis modestly in $X.XX are to with second than from midpoint normalized SHOP. XXX adjusting QX the May our results to improving FFO assuming forecast is the in and to and March June. quarter is $X.XX of HHS a QX points, March to quarter grow XXth between occupancy FFO continues per as is April, increase occupancy XXst June midpoint occupancy of Sequential result expected The gains.

quarter. in are day activity community an grants, excluding be to with increased due offsetting flat higher and occupancy, expenses, lower operating costs second the additional HHS levels While COVID forecast to costs, higher

half Grants Finally, to continue QX $X relative our we And HHS assume dispositions in guidance. we’ve from of expect back remarks very still predict. included not in activity. uncertain billion segments, and that QX sheet our prepared In in we’re to capital Triple-net the in are the positive, finally, business I’ll on in Office remain trends XXXX. with Though NOI of I’d difficult close like SHOP balance to our we pandemic’s to proceeds a underscore receipts impact in highly property liquidity, stable QX. in the SHOP environment. and our our

fully We renewed near-term at May with our enjoy and better the continue improved of as pricing senior quarter, notes liquidity we revolver XXXX. of Xth. Notably, repaying robust billion $X.X due first $XXX maturity to in profile million by our

maintained gross in to times, the COVID total quarter. terms of impacts to QX asset capital continued debt-to-EBITDA of EBITDA In first quarter. as net XX% was the at X.X value we debt structure, in the feel

the as half take which and debt-to-EBITDA our net ‘XX reduce is housing senior finally continuing first begin asset peak with That then of and our half in all second of the Ventas behalf sights. post-pandemic We improve win debt is reach actions in expect we in will prepared the to remarks. its to to committed recovery, colleagues, appearing to the On sales. my concludes rebounds

limiting questions caller back two With operator. the to be the respectful to that, to turn I’ll on with start Before line. we call to the Q&A, each we’re everyone

Operator

with Amanda Your comes question first the of today Sweitzer Baird. Instructions] line [Operator from

Amanda Sweitzer

Thanks. Good morning.

You highlighted at you take move-ins the opportunity that return. all? index lead further stays conversion could Where in move-ins? and sources for improvement your or Can rate conversion it quantify opportunity higher respite as

Debra A. Cafaro

Amanda, this you. to welcome is Good just I want Debbie. morning.

the question. welcome you. turn want I think, call. Justin time our to And this your to is first answer in your I’ll work participating But, over to we hard

Justin Hutchens

from plus to XX from have like our where if of remarks. to and That’s leads has lead ask handy, see driven driver Throughout update, company to going persist. the But, looking what has and should resilient. been It’s come what very we’re been driver. you It’s turn the our and And sources conversion primary that I’d referral professional is highlight Those back referral this leads to back what come articulate page comes been I’m put back and in strong them And XX% rate business started we XX% rate. to move-out agencies. the activity. historically those personal to which business driven that occupancy category, of ran will through calling the prepared time in referrals, this benefited pandemic, want which Those back from at toward referrals, look Personal grow you and it that’s level of relatives will through And move-in professional typical a pandemic, to you friends, referrals. run benefited to lead internet. It’s simply versus XX% to our for as referral all respites referring indicator at a overall now. grow XX% experienced, respites. the if health But about to their because phenomenal. that a prepandemic conversion grows. XX%. professional XX% They’re are then, each at to care during that XX% leading sources. XX% the now. residents is -- together, ran personal have They’re and we referrals other convert

professional picks XX%. those And are care up, a referrals. As of health that’s at still nursing driver running skilled and only

there’s that’s where leads We in and given our feel why do back. as strong our is time come more we that could we pickup we those performance see given see comfortable activity And that. a move-ins the over that we’ve come over back. opportunity it XX%, And have, for of highlighted time. to net started XX% and move-in So, volume

there’s are slide the on March that highlighted therefore notice leads a know and personal respites move-ins. April driving that You’ll bigger referrals particularly and -- more role and we we QX, the and playing in that in

Amanda Sweitzer

you Thanks customer within talk U.S? seen the occupancy to for terms And you’re improvement a detail. helpful. XXXX? of that in a or in U.S. movements relative you across That’s productivity then, trends about Have up, levels, could lifestyle-driven following the more either specifically SHOP return of more seeing

Justin Hutchens

well Yes. I perform well. independent that continues throughout and performed you living can pandemic tell the to

the to relative living assisted and class Debbie of in We the prepared -- bigger social growth to have it’s little contributing period recovery they that points the every of concentration the the But, as lift basis big from a known XXX the from U.S., They United that bit where reported geography a over strong which living, Light. end that time the geographic role and think played I mentioned a AL far. of is really remarks. the independent thus recovery across is a States, so. to is point April, XXX the have part the asset had otherwise in of also March southern part that of we There’s

Operator

question Your the from with line of next comes Rich SMBC. Anderson

Rich Anderson

morning. Good Thanks.

Debra A. Cafaro

This Rich. Ventas. your for first not is Hi,

also. too, welcome, So,

Rich Anderson

earnings my of XXXth is call. a season, it Actually, the on few us Yes.

Debra A. Cafaro

Congratulations.

Rich Anderson

with clear more So, the more medical of kind of at meaningfully now on of in road? come getting chart your terms broad were when changed? look you about housing. recovery, on mindset of With sort the has of a out look you’re But, pie more that seeing view down time office. was terms there your it. of aligned growth science Company where how was in for the that life period much And you’re might dispositions, that senior making maybe and will what and is excited of where it area the disposition side discussion a you Obviously, of

Debra A. Cafaro

Great. of Well, our office senior professional Justin we’ve portfolio. in is to of to the a expect here we be exercise and can make commented that combination how again, And dispositions, judgment we enhance it dispositions, in terms housing. his

a great now But, behind finally been, doing in Groupe Hopkins here priorities But finally a Maurice as model been that. the then. consistently at our to so is so, between side. know how say, disposition the and have he’s and year investment and we’re to I housing. other Justin, And care looking the asset later, the done with he’s of course, side, I continue the our you’ve pipeline Le business Francisco seriatim look And been health -- has San on science obviously, well. getting kind classes don’t life well ground-up of really we opening It’s that’s then, the senior developments would the South with clearly, that. what at investments, and And ground-up as that development, which

classes, we on asset think are our Rich. I So, really across foot front our

Rich Anderson

is, senior puzzle seeing? That’s housing question crux the years now you’re two, out, of you’re question. of what the seeing guess, a the the that I is three bigger piece

Debra A. Cafaro

that Well, do then, side, in exceeding as and I prior the could I of upside Company coming have well. important as on from believe, all, external have opportunity And we so. NOI. of most is mentioned, you to that recapturing investment embedded every the of course, levels And we first see growth the

Rich Anderson

a just one. And quick Okay.

LTAC listed it? XX% and and you’re that good net collecting year-over-year? number rent. What few IRF the triple side the number Since in just noise you kind a things on down number, created on the was a On hospital the XX%, basis What’s same-store downward that that of side.

Bob Probst

as the Rich. That’s you half of we last I’ll take the second Brookdale year. in that did, one, know, restructure

So, you’ve seen that lap.

Debra A. Cafaro

And financial you differently. as full to pleased numbers see though comment, Right. warrants. we It gets just recall, today a upfront. -- X.X years’ And gratuitous the the statements run yes, we’re very worth Brookdale’s through even have glad reported rent and we essentially how of collected

Rich Anderson

asking. what is, again, that if asking, what those was things be like would I guess, I normalize XX out? my I’m types question That’s you of Yes.

Bob Probst

it. we the Well, normalized you’ll of growth, for nature the addressed it’s Rich, that big type year, escalator rocks see last

Operator

Capital Your next Sadler question KeyBanc comes from with of Markets. Jordan the line

Jordan Sadler

really to the comes on" Justin, back to question the about "turn comments the And My lights your I back come scenario. move-ins. wanted to

if So, you would XXXX as occupancy. -- scenario what in in What does and suggest XXXX? XXXX across move-outs look you and of in-place the a what So, then that percent look move-ins happened XXXX, sort net the could of portfolio, that overlay like right? absorption

Justin Hutchens

Yes.

performing above basically as Just on, month. lights that show for based to earlier. Obviously, points you basis up the turning XX a reasons described XX, structural work, described it, on advantage, I we’re well that the I

Jordan Sadler

investment have But, some there of development more is Okay. would more That’s as acquisition come non-sequitur, on Where maybe the to of a is you or that R&I it’s helpful. then, an opportunity. there, guys flagged seeing. you follow-up And you more guys the of right say are sort opportunity heavily weighted it story? know now? I

Debra A. Cafaro

both. It’s

consolidator that about. it been we’ve volume life we starting will about, talked we’re we’ve a housing, talked as grown, in of science the be mixture senior ground-up as to deal we see effective And and an and and think, research as innovation. I always development well as as

would expect be I so, there Jordan. And as to acquisitions well,

Operator

comes next Your line Joseph question from Nick with the of Citi.

Nick Joseph

Thanks. dispositions. identified? of being those Where now on and assets terms just following marketing up are the in right Maybe expected

Debra A. Cafaro

They’re pipeline stages. at different in the

Some and of there, others are almost already kind are are kind on of others the way. out out there,

going a it’s the through system. So,

Bob Probst

half close, year. the the to proceeds back the in expect We’re to reiterating, we that get of Nick,

sense So, you gives a many underway they’re it cases. well in that

Nick Joseph

maybe just then, on And senior housing.

You’ve obviously demographics. talked a lot about the drivers forward the and demand

given previous you to at, you that though, would their to starts additional when they’re forward runway expect starts? development and perspective to from peak. that attract looking well down would from accelerate? Just start industry is of when industry expect the kind an the But you Obviously, just

Debra A. Cafaro

I closely. Yes. And I experience prediction. are of evaluating a say would that a is mean, matter we and it such that make judgment to

the first from Here’s down level lowest starts and are the said, Justin sense the in then dramatically better as was gigantically the quarter Again, that, XXXX. what’s interesting. since peak,

CAGR that’s when have spikes thing And this board, get over things near embedded going ultimately good. going window most kind opportunity that over great over We in XX, to in is of XX XX, really on drawing to in X%, where term X% this X% have couple population, really term. the as to forward So the to really, going the which where the start supply-demand time you’re know. to you’re you communities important tailwinds look of that even the of intermediate have years this going if are really have of some sort window on you’re you know next to of

say when chain probably construction some supportive there that issues. that are right We that of they know higher start. there know construction up pick not increased delay So, of those we to costs. would will again. And Those costs. supply the would things also We now hard know be rents are may

like forward So, when you runway into as together, the we out all recovery. those come put -- things post-pandemic emerge really the we we of

Operator

Your of Capital with Bernstein next Daniel One. the question line comes from

Daniel Bernstein

to here. stick housing going with I’m seniors

of then So, flat at maybe morning, in was listening that a indicated they the margins to the I this XQ they more and call the second ramp-up half in Brookdale looking year. were

in trends I pick guess, about trying ramp and given the was occupancy? thinking look to, brains margin housing might your you’re how like, I So, seniors in

Justin Hutchens

Yes. Justin. Hi, it’s

where comes the come expenses should then dynamic the day there’s the operating expect occupancy. you back some of see NOI to it. COVID extra now definitely would growth occurring will then Revenue in second have and and an really come the quarter has first You a Obviously, down lag up. expenses

the lagging expense you see as performance of coming last forward, So, kind -- lagging But would from the there’s metric. as some run you extra little margin that.

Daniel Bernstein

a on thinking had we’ve pricing the Historically, upper terms how is, then, in pricing about that changed at inflation. be power question all the matching XX earlier occupancy industry’s industry? XXs acuity And the -- are of maybe than cycles? focus allow power see related might you Have to pricing at in dynamics of to previous

Justin Hutchens

get that advantage highly say up. on would way the I business Well, leveraged the the we of

we’re definitely that would try time. right expect a just using this to into really that volume two to incentives now, price of though period And for thing volume. continue -- encourage it’s a operators So, we game recovery are One discounting months in to to and higher, I and markets starting to start a focusing expect used occupancy go for volume. -- sole we be around until is more see but operator a would recovery to get certain discounting, to consistent price hear selectivity little on and

Debra A. Cafaro

X. you to the pricing in-place as in of increases even XXXX. strong And the been have know, really And we benefit once turn volume, this when page get power to we the see able you the January that environment, we pretty build

start talking really that’s benefit in so that terms about. accrete Justin to of the is of volume the where And you

Operator

Your comes next question Juan with Capital. of from Sanabria the line BMO

Juan Sanabria

question Justin. for A

that then, your that constitute of out SHOP secondly you’ve the in housing that, been now. business, the or the of related you if approach by top stamped necessarily management an the the year of You’ve constitute management perspective Curious geography of kind or a whether XX% call operators the partner I one it’s SHOP seniors changed about or And or Eclipse enterprise? asset of at things to business. XX% seat on of a you’ve the noticed didn’t

You’ve about that joint that that. previously venture on you relationship? that’s talked in are about still something or thinking table, Is the

Justin Hutchens

question. the make with the thing though we first drove In on lot adequate start really did XXXX, we that a had want I’ll triple-net we the Juan. attention the One resources and XXXX. priorities, and priorities. that addressed in sure pandemic to Hi, is

to recovery. Now, we’re moving

three taking the of actions really there’s In that supporting remarks. of we with the others. handful highlighted on the XX%, Eclipse, So, business. Together, to focused Groupe a Le basis, a our XX% of I is resources along Eclipse and operators some have in certainly Maurice. our operators in that’s and were portfolio described stabilized of my through Sunrise, the on recovery Atria regards I

Juan Sanabria

And seeing pent-up history data what data some analytics telling of length ‘XX? Okay. saw terms curious in? the of fact, coming Are the the you presumably the that may seeing what just people the the over does move-in in of level I’m data, suggests you in? to about what you’re higher stay, coming acuity do what of level in if you XXX% acuity on is you’re in demand, And given

Justin Hutchens

business question. respite part stay go Yes. actually of months, described seen was that the of up. length past earlier. That’s we’ve XX that of a reduced Throughout And that driver the great I

little we will leads up, So, sources. of length demand, short-term by look if we of business bit number you regards think that bit. demand come more pent-up about a back think that’s just XXX%. really to stay the little page not about the I has demand, In pipeline. supported traditional XXX%, as bring lined down notice it’s gone at up of stays -- big that’s into leads, and a some XXX%, It pent-up fully When and it lead as the look even you’ll the at update, we are X demand, at

I’ve pleased operators, pent thus So, much having But the so quite of thing it other were that for the come to for up. make you recovery we’re normalize I’d bit had waiting communities with closed, is one been doorstep as a they’re We say, been that activity this certainly, waiting to consistent. we’ve mention leads or the And I’ve vaccine And was decision. the if and spoken actually pandemic. pretty far. with throughout not not it

So, open some and providing our again we’re demand for lead seeing the and service. come community is back just sources

Operator

the from Morgan Vikram next Your comes line of Stanley. Malhotra with question

Vikram Malhotra

and how PPE. items maybe food just just a all Good for bigger morning. information. on operators line through prepping -- the -- perspective labor useful the lot XQ and of for the side, margin the I potentially potential are taking on, X can data and you and Thanks the Justin, slide from in back thanks And expense over the sort for X, other all if the us on think, maybe this XX, terms first walk of even increase XQ to one Maybe of a going and questions.

Just, how about if that could margins And near staffed like to least? have extend you inflecting anticipate term, at talk the operators Do already we just then, labor? up? in

Justin Hutchens

Sure. Yes.

relatively have coming we COVID expenses, term, down, total to we have near the up. be because expect in flat in margins, So, we other operating coming expenses

just just ahead of of we’re If expenses. other and is $X.X growth. the look you mix that’s expense projecting our The labor extra quarter. million day quarter, of at costs an in a rest Half around

term. bit, would it’s after occupancy So a expect a but -- the expenses big more expect recovery, to margin And in lift then, into high as would we very incremental we a of mover we near not get course, really revenue. that on

Vikram Malhotra

picture. just, maybe bigger then, Debbie, And

this terms maybe now opportunity of the multiyear more areas, there on sticking get citing an buckets. acquisition and you housing sort you’re aggressive focus of to potential a whether Ventas give approach? us more for over Given period, on maybe recovery some balanced in Is are rethinking color the senior certain in you’re a or

Debra A. Cafaro

over benefits the highly of do diversification, served years particularly over incredibly we year. us subscribe last to It well has the Vikram. the Again, and

have We always senior the believers big business. in living been

our our to we senior recovery buckets. we and that we invest have we we excited that in We’re yes, of have this intend return. equality also, provide But risk-adjusted certainly now, opportunity good and going portfolio And upside embedded intend to find where expect think assuming assets housing, acquisition acquire we in really markets it’s do to capture would to and in totally that.

Operator

Green Street. comes the with Lukas question next Hartwich Your line from of

Lukas Hartwich

Thanks.

the So, provide housing opportunity can to allocation, capital like set view and just senior on U.S.? size house just comes of looks an returns. what terms update I’m in the on the maybe you development when in it curious

Debra A. Cafaro

standpoint, it And Well, We to We do have invest this high. look welcome population, model U.S. that that. the opportunity costs think returns be -- have. are as in because But fueling business demand we basis we again, the big And and risk. to ground-up penciled this great because which you There demand. LGM. is the you’d talked development to little would that We talked Canada have have cautious that -- also. we in about it we with a housing sure existing with of really from think think right really the housing, senior opportunity investment in now, think to is XX-plus we I with have that we about the we demographic we I is the I do the commensurate certainly a bit. in make to senior know an growth at Construction a out there’s in cost little relatively the good morning bit. recover discussed,

Lukas Hartwich

That’s When in you’re disposition let I’m business? on just helpful. thinking waiting story SHOP, to on the that curious improve And selling versus guidance. it the comes to then, now how about the fundamentals

Debra A. Cafaro

Yes. question. Very important

Justin, you why don’t that? address

Justin Hutchens

Sure.

fit for well be probably have in maybe the potential or the we’re operator. communities or fit is different maybe long-term that mentioned not certainly the There’s I recovery hands of to to the positioned for some one So, recovery. big priorities of sure make that may contribute a us better of to a operators. less a

actions our in a And so, quality the really review overall we’re of considering of there’s underway lot that of that positive net and and terms portfolio. should growth

Operator

line And with Valiquette your of from next question comes Steven the Barclays.

Steven Valiquette

So, first, just was earlier. leverage SHOP the Well, within that touched my to portfolio on also using operating round the relates here. question numbers

margin when with Just about industry we lost using pretty much to line X,XXX in occupancy, round the of of close averages. of equation. you NOI X,XXX bps take That’s numbers, bps stimulus the out

recovery years, XX% that the to over we in ultimately the back pre-pandemic? dynamic. the year margins the about margin the recovery in XXXX NOI SHOP lag we Thanks. talk should saw this But ‘XX. occupancy confirm around did Just NOI few view assume longer-term that You range that XX% get in want versus that to next to

Justin Hutchens

was pre-pandemic margin Hi. call as going the first. is I’ll going pricing pricing all that there about that’s It’s get the to to the earlier volume And be back and levels. yes. question There’s just pricing Justin. returns, power then, help that on to mention way talked -- answer -- a it’s

Bob Probst

equation. to increases, need more begins the the underlying to keep pricing again, we pointing with fundamentals, rehydrate, supply-demand power. to And as in-place occupancy Together

to So, get over time. I anything don’t than other think normal we’ll back any to there’s believe reason

Operator

Scotiabank. Yulico Your with next of the question comes from Nick line

Nick Yulico

move-in just going the back demand. topic data the to and So, pent-up of

level you’ve call And earlier April June I benefiting is comments to that are you’re most the of like there cited move-ins you of XXXX. in much a two there pent-up square right you single together, since that didn’t the because that’s some had the was pent-up in month if just high, demand think now. move-ins that move-ins was then, demand. it I’m trying also that seems saying think those

Debra A. Cafaro

really well That’s it demand. and very just not we’re be hearing, what organic Yes. could

are -- there So, ahead, go Justin.

Justin Hutchens

that move there’s being other say, going in one remarks, the point outs lower I just that’s earlier, was well. and the prepared I’ve mentioned I Well, really -- as to mentioned

with So, what just all personal recovering, I probably not there’s netting of at they’re way feedback door, the necessarily of characterize just back of and demand It of -- And that, of from [Technical structural the biggest their is resurgence -- in leads. yet. the the certain That’s that, one something They’re demand. the up. seeing not fundamentals why pent-up kind did indicators I residents think, just then, referrals. operators earlier, combined a have as to conversion are of occur. amount we the not higher mentioned pent like Difficulty] These you they the relatives their as it’s that’s referring friends necessarily going terms overall the again, are

Nick Yulico

move-outs sequential we I expecting benefit should quarters? is will the guess, the as that your this in think about benefit are XXX you’re and think quarter Meaning, guidance occupancy How and about benefit. eventually points unusually large And as basis that second the because -- in future for Okay. second we pick to an XXX spot up. of move-outs quarter, a low

which of sort see rate, of is a have forward. high this move-in moves we’ll high how now, going that activity but conversion right level You

there as we’re quarter? second is in Just going trying or about number the think unusual in carries think about, benefits some thinking number future, here, through to second reasonable build occupancy the quarter are the sequential the a that forward to

Bob Probst

rate away, is up. Justin described goes lower the means what time, move-out of the at on "turn highlight same goes move-outs. lower the obviously, over scenario, I’d which as light" That, the occupancy occupancy as

of before there should summed sort some So, up just regard, would time. that The move-ins in as demand. continued over move-in XXX%, referrals isn’t real suggest in XXX% [ph] incremental much be that’s This temporal. these the to so of opportunity

but put quarter, benefits together only it future. and not should the those so, second the benefit And

Operator

question line Carroll your Markets. from next Michael comes Capital with of the And RBC

Michael Carroll

Yes. Thanks.

Nick’s pent-up guess, on I off of, phone demand. think out. my Just break I question And sorry, I’m

I pent-up haven’t So, you term do from drive you few you might of over already, and I mean, months, see should leads demand the answered few been demand, about know I and expect that could But, on higher the today’s of how have pent-up if liked think some move-ins I’ve this call. hearing times a missed this that we’ll or we level level next it. that?

Debra A. Cafaro

anything I whether Yes. don’t hearing it’s other our ahead, nature demand of that if is demand, that moved is would strong, resilient Justin. that that good in this go of then mean, but upon based know it aren’t we need-based organic the I bias pent-up it the from Mike, sources the or clear, really, now move-ins organic have is and that’s communities is anyway. the than not, that and strong. communities, availability And more if makes

Justin Hutchens

of if you X, leads, the the straight months, Even ignore we on point, during the other across page first line April, One and a just move-ins... were draw the running averages. you beginning the May, XX% pandemic, pandemic, it’s two

Debra A. Cafaro

Right.

Justin Hutchens

closed of had our at given we XX% time. And any communities

And as in have the so, they to continue people need. move

Debra A. Cafaro

demographic, from page -- sustained X a that that’s is on at positive. that. resilient, of the which deck. and we use Yes. using can this word, know frequently. that keep really we you is demand think looking I And very I There actually see it was and I why is need-based But, growing

Michael Carroll

demand this see to pent-up enter leads move-ins higher we some trying was Okay. move as and could even Yes. of referral other expect this, we come market the get those on, I sources point? could do from and these to like, just

Debra A. Cafaro

And you they level you things said reported health really care you it to think professional if could okay? call for you really But, medical and about -- haven’t earlier fully bounced that a surgeries of of be with Justin okay because want really it, kind they about UnitedHealthcare -- example, said what when that when you referrals indicator think with Well, leading procedures is would whatever and connect when maybe it, that procedures. us. really and those senior back,

look come seniors as see you referrals surgeries those professional delayed those at If start you that then a you on. that pent-up characterize procedures, you they to demand so those had could back, As if those want have and and

you over to So, don’t I -- quibble words. could want

is that it second we what’s seeing good good come and through and demand two projecting we’re continue. think, it’s then and I it there’s the hope months, will are and consecutive really for quarter

Michael Carroll

guess, the a presentation, real have just in weaker that Canada more what’s been you bit Okay. And COVID breakout then, and I Canada? little The that the between to has quick. Obviously, outbreak. of lead due U.S. data the one

U.S. leads than is Canada? So, the in higher

Justin Hutchens

Yes.

number way Canada, where when around just their had X. of you characterize there’s look Canada, vaccinated. maybe I’d That around it’s at purple a not page the really move-in just at marks XX% more top, might X, it’s page leads, is the the Canada communities So, a activity.

You know much than later been phenomenally we U.S. could that’s see U.S. once strong. got same the in And news there the expect the would We Canada. is, the we have good in thing the that trends

a underperformance. of was little bit there So,

points. see that next basis points can the where page, was time. during up XX on Obviously, XX Canada negative You basis that U.S. in was March

lagging to vaccines them The come vaccines executed. later. performer just us. came little they’re fully the We expect been a would as back They’ve a So are bit. for good

Debra A. Cafaro

report. your Mike, thanks. life science on And again, compliments

Operator

with line America. from Dennerlein comes of question next Joshua Bank Your the of

Joshua Dennerlein

on margins. question A

anything structural once prevent to SHOP Is pre-pandemic SHOP you’re we going pre-pandemic would margins there Just kind levels? of that levels, the about kind that margin forward. hitting of of return the thinking occupancy from their seeing kind

Bob Probst

seen we and the Sure. that the structurally suggest second pricing will confidence in housing, which through think give would believe obviously. pandemic But there of power, anything changing return fundamentally, we’re the that over as the seeing, is isn’t will to Timing fundamentally. at that we’ve time, it, quarter again, proposition margin some in we that look especially the senior structurally, demand I determined, now Josh, structure in of value that. be that

Joshua Dennerlein

Okay.

-- like asking get -- you to of guess, So, what I once it we the going the level, see kind sound same higher protocols we like on margins does should roughly anything might I’m a that far pre-pandemic differently the operator is that to be anything going are there is hit is expenses front as like -- do like forward cleaning as that? or like,

Justin Hutchens

relatively on once Yes. might margin, further that. out be going some But, we us. get moving there gets the to of -- I’d limited say, the be forward, pandemic behind it’s

definitely margins that So, we’re comfortable come back.

Joshua Dennerlein

And touched of like rate gauge going briefly to question move-ins. of kind then, new on, just helpful. wanted differently would on free another is little there I for of but think is be any ask of one What’s it level on? kind Okay. a or the kind month bit Like, current discounting

Justin Hutchens

-- fair or rent community structurally in are one them just given there’s a never kind rent operators There’s community the care give you game being offered. discounted. of being name basically upfront. Typically, are fees. free There’s lower There’s waive But, and to it. fees and tend charges

But, So, of discounting wide behind we can in get right there’s the variety discounts now of impact the a the market. us.

Joshua Dennerlein

of holding or it this kind is at months, past the steady over accelerated that point? Has just Okay.

Justin Hutchens

our One It’s it’s been starting supports said on relatively steady. XX% of local back of where mention Yes. the discounting pulling are that to occupancies. already stat I’ll on the focused seeing been is way the markets April, get kind its are they’re And system at steady. pre-pandemic back that It recovery. fall, and of that into and end operators communities, relatively found I very like last earlier, to

would imagine now power moving forward they you pricing So, that have again.

They’re bit of discounting. the obviously, little so, are a starting those that will NOI to tighten supportive growth. And identifying operators And on communities. be

Operator

Morgan. comes with from JP Tan question next Your the line Sarah of

Sarah Tan

regarding Hi. housing for Mike Mueller. Good portfolio for Justin, is Sarah senior morning. the on I’m one specifically. operating This

to ones more and between geographies. differences you seeing are assets some terms southern and what urban I differences between of in think you similarities the or alluded in the the But, demand northern suburb?

Justin Hutchens

the there’s sure. south I’d of point And to southeast. in a wide that The the the real been Yes, really say only been geography. is There’s little meaningful recovery and bit we difference. been experienced can a difference -- every has

mine is York very, with and visited to that markets, had leads you say, bad the high Several experience they would If one a I communities local pandemic. down of very comes that very early those dig have move-ins. the New we recently. into

start and still we encouraging. It’s you’re so, by vary shaking to or is seeing type in asset lot the really Northeast. there’s widespread some And going But, a price point. of asset And particular do, really It’s I before recovery markets out the to classes. calling happen recovery early. think, very

Operator

today And question Mizuho. comes the with line of your from for last Omotayo Okusanya

Omotayo Okusanya

alluded, [ph] days is have Justin, you. occupancy in let’s the really, XX strong. it since specifically this been Again, one past, to gains, call really the

are also really, Your really XQ assumptions strong. guidance, your

You you’re is kind also but similar peer out numbers strong a seeing quite little seeing who’s the that be? let’s this as of a doesn’t you outlook? near-term meaningful difference between trends, have there forecasting. call as why the you’re about two, and seem of Can the numbers bit kind Why talk it, may

Justin Hutchens

the can’t for we’re to structurally and strong cetera, support markets as on what peers move-ins. et in and support be for leads netting. really our earlier, mentioned the there of I within just are I Yes. continues But, then, terms seeing And seeing. with strong comment performance own lower, move-outs being and what

So, we’re that’s what seeing.

Debra A. Cafaro

obviously had strong momentum. first we outperformance also also, had Right. and we the that’s in -- quarter, And helping that

Omotayo Okusanya

it a end recovered And you’re points? Justin, things that if -- got faster the of of Is the state kind look curious kind recovery have now recovering that kind perspective, then, I’m thematically, picking at of lower can the price first than is you up? data, it COVID just the of share market when from that’s with you of hit kind of faster. any the kind high

Justin Hutchens

and trends not but as we know question. closely a those we’ll correlations, And the it looking is lagging, materialize. widespread that We yet. tell for great a U.S., performer. that the strong we’re I been is And That’s traditionally we’re Canada recovery. can seeing then, in very there’s them study you know What that

Debra A. Cafaro

want forward speaking for us Well, in thank Thank We to in interest you joined we call bow. the you. And and wrapping thanks look a appreciate Ventas. participation everyone morning. to your I with sincerely soon. your who this up again

Operator

may today’s concludes call. this now Thank you your for And you And disconnect. conference participation.

Ventas (VTR) 7 May 212021 Q1 Earnings call transcript