NHI - Earnings call 3 2023 | National Health Investors, Inc.

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Operator

Greetings, and welcome to the National Health Investors Third Quarter 2023 Earnings Call. [Operator Instructions].

As a reminder, we are recording the call today, Wednesday, November 8, 2023. I would now like to turn the conference over to Dana Hambly. Please go ahead.

Dana Hambly

to results Health of for welcome to conference XXXX. and the review the you, the Investors National call Thank third quarter

and and David On President Chief Accounting Officer; are today Travis, Spaid, Kevin CEO; John Officer; the Investment Pascoe, Financial Eric Chief Officer. Chief call and Mendelsohn,

call review our are together to and now information Eric nhireit.com have release, or the terms over quarter furnished been other measures. NHI's information are Reconciliations in encouraged X-K the Investors in reconciliations of media. been market cautions conference results in statements other the risks closed review various forward-looking provided XX-Q SEC's urged this the made which The accessibility involve a well Any the related judgment including covered were for guarantees are not CEO, represent available call press Copies Securities September are to by at forward-looking are not schedules, financial filings release. XX, NHI's notice used disclosures as NHI's NHI's provided earnings XXXX. periodic release conference Commission, its Exchange as website in NHI that's by investors the sec.gov of Form SEC. Listeners the call. future this tables and yesterday as disclosed with of financial at to the released on I'll statements of all may certain in the website release these risk of factors In are facts, which Mendelsohn. of this and in reports are uncertainties after forward-looking and date non-GAAP filed statements on or Form any ended call, provided turn that carefully addition, are the on historical call performance. All of the which NHI with with that and earnings those and in conference statements. this

D. Mendelsohn

distribution record $X.X $X exceeding cash of Hello, in investment and and strong segments estate for pleased number stable driven including expectations basis rate FAD or million by catch-up with to due thanks deferral X real SHOP no growth collection us concessions. Operating opportunities. higher, quarterly sequentially. million, our X% available the increasing discrete were rent repayments confidence to of year-over-year payments our metrics continue results a organic today. which We're report bolsters tenants from factors, our and of trend for joining a by unexpected rent past in and a very for These quarter funds the cash X%

continue partners trailing Given details results work to more into and the all hard across largest needs-driven occupancy start the minutes. The to deferrals straight third year. steady quarter, been make it's over our the trailing $XXX,XXX fruit sequentially of and seventh the that pushed the a guidance to quarter. coverage sales improving to Bickford, fourth XX rent fourth for in the increased X.XXx the fundamentals. the in amount with repaid higher The September, to senior gains X.XXx continues higher drive optimization, has improvement tenants. our operating in excluding asset housing continue we're and focus or and bear portfolio, in for basis. third of highest average portfolio's instance, on similar in coverage quarter, Bickford, particularly quarter see visibility XX.X% including to since expect John the within happy operating a is this we their quarter for pandemic. Bickford quarter, through during a who coverage will XX-month EBITDARM quarter the our outperformance we classes the are in few FAD increasing foundation current for the the provide

trends. These the skilled contribute below The is coverage the a which is fee by the great foreseeable of to improve. approximately our that repaid third entrance indication operators quarter, generally level, encouraged continue generate and and is we approximately million this good expectation nursing which future. While believe deferrals our $X.X in NOI, comfort XX% operations for results, this portfolios, continue of to we're our

gains. Housing Senior basis November straight SHOP, of reported show point. external as XXX points starting to is of fair vehicle preliminary certainly has the have has now had an happy XXXX. and momentum straight of organic from challenges with Our is well. SHOP its which to months We're or quarters important said, is in a X growth low would expected consistency increase the performance an with serves to to That the move that February up October continued higher grown The and occupancy September. we're for the more over share and opportunities. and not generating operating highest as X see XX.X% since for month occupancy, Portfolio in this of we financial very That for platform results

to communities resources just committed to make our best-in-class. the would X their the So continue held we for on remind cash tenants basis to properties, I other Senior amending $XXX We X we're optimize to up X years we and selling million want of we for has maturities and end, To markets. NHI. impact capital well-capitalized Not ample be work to particularly that and without continues Living's available The for completed growth immediate looming We're ago, $XXX The the tenants, and X to rate investors equity. said these assets. these I financial that to deploy of in of that remaining clear cash property million night point properties last balance flows. last sale. I favor that with leases dedicating have at sale results announced over underperforming Discovery estate we necessary have are and week closely sheet real to process, capacity as leverage just coverage X.Xx debt NHI with complete with position we the need dearth liquidity, improved a of our environment positive REITs to on the substantially should surprisingly, interest had like efforts. the currently

the more cost cost our in patient more strong operations. about our We day. They year an continue of carefully of we be I'll a pipeline and of great should of financial to will regularly changes the is discipline That for was over be a as the stay call in sellers enhance has X%. illiquidity everyone portfolio. realistic to expect in in live we've housing our sure another them We Kevin many growth. and optimism is quarter is $XX In maintaining longer the hire with increases our details capital of treasury sum, they position portfolio to work last seeing think basis towards about exceptional outstanding that the of to future favorable, in capital as temporary perpetually the that fundamentals we the points run. to hit participate NHI success this Kevin? to the on discussions fight will now to significant advising are and monetization capital. made what case become there our partner including that the industry customers make quality while senior deferral choose and growing last are focused of the in million ungrounded over strides the XX-year and opportunities, note XXX great upside our their be SHOP We balances long the provide cost turn the to organic in many years behind on the

Kevin Pascoe

concessions These currently XXXX. X formally which leased property for of X the date and health, the by on of sale proceeds activity coverage, them or Thank comments performance of as basis cash to you, plus limiting as million which in We well $X.X operators. in the properties the early and disposition sell improving expect quarter seller financing in underperforming Eric. future quarter. and better were in third net I'll accelerating fourth our repayment. We closed deferral XXXX for properties we held to X investment concentrate asset of thereby end by have classes the million puts my sale, financial now major tenants, and rent $X.X on

$X.X to rate the increased third loan amended quarter, balance that with and we to X% million the increased from million the During from XX%. a CFG $XX

recycled are would pipeline deals new and that be reviewing immediately accretive. several We

friction noted rate interest has Eric the environment though, process. the more to added As

platform, shift and few the is fewer across Investments issues, gains With team industry remaining margin we patients Real will which our to trends evident the Fortunately, our X.XXx segment to we are This had today steadily more is seeing Bickford second quarter large annualized have expect X.XXx, in year-over-year with NOI, improving, SHOP excellent. rewarded. Shifting with be which part growth. driven that range. buyers with continued capital to asset occupancy plenty quarter. Reviewing significant XX% coverage expect and deploy is The in trends straight XX-month from improving been and average to above in improvement and was occupancy positive X% sequential our need-driven operators at sixth been the again Occupancy increase representing rate The the resident driven have Bickford of sequentially, strong collections, to deferral primarily Overall, successful sequential encouraging quarter resources X% repayments, we trends growth the trailing of cash coverage very management. third basis. Estate remain has allowing by saw and record on the tenant the at cash by challenges. of to a a performance. we

for average low. Agency to wage recent quarter. the inflation based EBITDARM gain occupancy XXX think recovery. up point is do to down was amend Bickford's XX.X%, at September X.XXx has a of helping in scheduled basis of months coverage strategy financial directly the NHI outcome, more while terms. the successful quarter which we XX.X% is the so April Third reset XXXX. as performance discussions alignment levels Xst far and from next year have achieving was utilization that culture. existing is income Bickford company sequentially deferral XX a increased grows third rental points reflects rent the represents basis which in which repayments in significantly, have on are stage on a quarter. We early XXX performance a to mitigate company's and occupancy every the the to we proved interest trailing Bickford's related build are repayments and Bickford in allows participate our good expect This Regardless April better more XXXX

need-driven sequential Aside the XX and since assistance. is certainly quarter quarter encouraging, from of other XXXX financial the coverage the continue is coverage X.XXx, increasing of some require straight the We reported tenants in is which some seventh to of Bickford, improvement. This highest second properties. across but

related are reset to scheduled on lease on master described in Living X As press leases in properties. our of Xst affiliates that on November release, negotiations Discovery individual was properties with our to we Senior other X and

to which performance deferral driven during expecting to adjusted NOI, was by on SNF by to resulting X.XXx, another strong to our that senior XX% and delay communities. conference portfolio, for has rent received entrance driven currently largest current While Discovery's reset solid XXXX up quarter better couple in the align we performance than which from largely This accounts from that at which are more offset X reduction reported a entrance the deferral of second our to entrance hospital a to other the which the group entrance represents the the refunds still SNF specialty solid with primarily sequentially this annualized The X.XXx. our fee adjusted excluding to by higher coverage last X.XXx. insurance XX% to call. The our subject temporarily communities XX% repayments NHI rent including fee financial Continuing the coverage across and of coverage, sales. Discretionary X move lease X.XXx repaid XX% X.XXx. SLC, from improved of portfolio, The XX% properties now housing Bickford fee from fee improving discretionary sequentially fully NHC's improved rent. Similar reflects agreement, X.Xx a of base tenant, sales rent expected fundamentals. on with driven portfolio, reduced be increased of change, coverage balance. higher was SLC, in of other to sequentially the NOI, tied are fee we X.XXx, master from in properties, operator generally mentioned quarter in X.XXx

prepare. was [indiscernible] proposed We [indiscernible], plan. frequently [indiscernible] and time better understand SNF to potential to the the are owners action impact [indiscernible] especially rule proposed of with communicating than with The better operators frame

the and regulations, and and our coverage throughout are portfolio strong that do to Given [indiscernible]. exceptional our sustained operating [indiscernible] improvement Discovery we in not Merrill partners, SHOP our adjusting we operators are expect portfolio with disruptive Gardens. financial portfolio, generating in constantly

strong As up third quarter with basis The indicate momentum occupancy detailed gains increased building XX.X%. to preliminary on October a monthly September in the earnings and positive occupancy quarter has a average occupancy ended press at for points XX% February. XXX been further This setting release, results SHOP to occupancy since as is in fourth XX.X%. note

sequentially a by NOI XX by basis in points X.X% a growth resident and X.X% XX.X%, The revenue third margin improved quarter driven expense. to operating increase

driving to growth. occupancy Our higher, is on be [indiscernible] focus continues which

John? NOI I'll [indiscernible] remained to John to to early give operating which we As turn unchanged. the the [indiscernible] effects view teens growth [indiscernible]. results discuss call the in [indiscernible] fall the off, leverage independent high margins dollar portfolio of significant expect operating [indiscernible] was living over margin has can generate the in long-term on of that now, range

John Spaid

hello, you, everyone. Thank and Kevin,

NAREIT normalized and per diluted net ended share, For the $X.XX, our share income, common XXXX, $X.XX were and FFO -- per respectively. September quarter FFO XX, $X.XX

quarter, our $XX.X million. FAD third the was For

FAD When repayments, third of second third of to million was to the $X.X an quarter quarter which of million $X.X quarter compared XXXX, increase $X.X quarter Our by second increased the of FAD deferral million. compared included XXXX.

quarter CapEx improved FAD concessions benefited also SHOP of second discrete the of the increased XXXX. The The from cash the to in modestly third rent a the X $X.X so $X impact payments approximately accounting. SHOP $XXX,XXX, million the was million NOI in interest by quarter higher quarter $XXX,XXX. portfolio's income. decrease to $X.X and of from receipt $XXX,XXX in from basis of of on tenants in third $XXX,XXX million The lower

guidance X from the which also issue we'll QX year. I the benefit which about end end $XXX,XXX results mention We February. and talking to QX tax expense as lower expected year compared and be our the XXXX will lower was continue items benefited franchise we to in more our through want today, of in to

which FAD when and cash include rents of collected. recognize repayments net tenants we any from received, basis impact First, as which deferrals FFO and income,

advance income, including deferrals collected all generally recognized net of but to received is in any tenants, For consistent one our owned no on means on contractually period. FFO impact of basis. in period metrics. Remember, income repayment income rental other straight-line a remains any have positively FAD from collected GAAP outstanding period effect or That will the deferrals rental

deferral the straight-line contractually in So the revenue previously was in metrics. increased decrease rent thus owed, therefore by FAD, in collections is million offset component. net collected $X.X collected when advance but benefiting cash mentioned the a million corresponding Of QX income of FFO approximately $X not or the

helped resulting noncash rental customer's the the in rental lease occurs amount, past, lease negative offset investment in that exceed impacts their Base Second, activity the of leases will cash of eventual a collected second GAAP second term. half negative, lease noncash income revenue the rent in the company's in the generally a straight-line new term for half income.

number a plus increasingly living the communities million with be an Senior example, and senior second noncash Communities, straight-line associated XX. more increasing collection are Living entering FAD of the negative lines, lease lease modifications, reversal in rental receivables. [indiscernible] represents between with our and rent activity expect metrics. new escalators, our straight-line built-up which the company have we of leasing resulting growing income, FFO a will the the negative noncash income, receivable rents half will was their September our of of generating of negative rental variance as $XX straight-line minimum For straight-line approximately leases rent

Turning to disposition. the quarter's

of in sold as net to the a one rent yielding properties currently guidance. for for has $XXX,XXX plus $X.X X book end of property and approximately $X.X value full on third held the NHI net updated financing, our million the a we sale third we net in closed During of proceeds, night, property million for quarter we X quarter, quarter, additional in million gain. million classified the $X.X a proceeds fourth Subsequent XXXX the transactions. $X of on contractual with and X X% seller $XXX,XXX. Last year of sale

with levels million. approximately prior of of balances deferral $X X in the first reflects or the XXXX repayment guidance consistent Our months experienced

not additional continuing any Our dispositions additional include repayments, our loan commitments, rent investment. includes continuing asset unidentified it concessions but fulfillment does guidance existing and of and

includes amendments the have flow, the loan also great guidance February, our from impacts amended Finally, our and into In more year. say through amendments on FAD when all including expense. We focus issue flows we we'll due the our lease of increased from the of lower primarily these concessions, income, picture XXXX CFG franchise and $XXX.X FAD our rent end X to discovery expense, range because operating repayments a increase million feel better our lower-than-expected guidance to capital share tenants, driven tax slight million. to dividend. the is We on a primarily the our than to our from by higher guidance. generated forecasted deferral $XXX a offset collections our The cash routine interest basis of higher of activities, cash higher we support cash provides unconsolidated deal FAD results by agreement, expenditures which interest and

compared from provided NAREIT FFO or to higher. midpoints FFO, night $X.XX normalized midpoint and and time XXXX for our FFO our to guidance FFO range last November basis credit normalized acceleration When the rents to million. in The related normalized metrics in of a equates due well collected guidance income and reflects adjusted rent the all our metrics, recognized early changes creates contractual volatilities as midpoint improved straight-line nonperforming which updated in reduction this a loss of cash to revenue a and reserve million $XXX.X the collections to X range loan. Remember, to basis, due credit reserves to in loss On deferred also in our to increased for increase our $X.XX time. share an a expense as these $X.XX. February initial We FFO of $XXX per we the deferred of and

guidance volatility our year, saw continue be we this focused we in on over delivery. to some While

from For the in liquidity over cash ample quarter. million ratio of of the adjusted net and At availability. EBITDA, third a $XXX outstanding our the quarter, in debt million X.Xx had providing improvement end million we revolver, to slight second $XXX leverage $XXX was on X.Xx our October, revolver

We On maturity also our full off million our private a program. paid notes placement have under we $XX available revolver. $XXX November using of X, ATM million

our mentioned today previously XX% and approximately this total stat. prior interest calls As represents debt capital retirement, rate after of our on debt variable

a year. new to sheet's are maturities will than the Our our the leverage to we short-term interest average the meantime, In strategy impacts longer continues next benefiting that issuance from higher to be long-term from debt improve in debt offset look to low our balance rates. negative

Finally, our third XX.X%. quarter payout FAD was ratio

a XX, we declared share concludes last XXXX. shareholders prepared January announced night, our our of XX, for dividend payable record and December remarks. Directors on $X.XX As Board per XXXX, of That

once call today. So you that, please operator, lines joining the for for our thank With again, questions. open

Operator

Markets. Capital question Juan [Operator This BMO Sanabria Instructions] comes from with

Juan Sanabria

Just in-place lease triple-net ask being of curious in discovery kind potential parameters outlined about just of other you in couple are quantify wanted terms with of of of adjustments? on dealing in kind large your that's can rents exposure X the [indiscernible] But this that the last COVID decrease the Kevin discussed some pie? as part to size of Discovery. all to the of kind is, the And rents of discussed some and a assets rent. today. the are represent Is of the how being gave potential contractual tenants question

Kevin Pascoe

is this Juan, Kevin. Sure.

our improve order triple we would with as both as thing Just question. pay said, X% answering magnitude on I have But X been -- with revenues. able reduction the to a them. sure side buildings and represent you improve. again, continue We're on on they was we some revenues I more I'm of about at modest want sure side. I -- so one upside have They to is make they SHOP what I to question net mean cash of the understand looking your highlight in make occupancy to our specifically to And had again?

Juan Sanabria

you not wanted that of XX% just to reduction highlighted full sure of I kind represents, a No. to the that subset. applicable Discovery XX% the revenues make was to X%

impact was, I may think maybe could other to that I sort that guess, tenants run some permanent, to an big production, was how it. quantify So Part some or temporary there answers be? the have the quarter whether Just that from the allusion rate? potential to net potentially need third smaller B of

Kevin Pascoe

is in I being was the guess of the Bickford. X.XXx I the at that around more looking coverage that at way would place exclusive characterize

While have exactly quarter-over-quarter, things be. improved where we things want to it's not

specifically So about. that a, that a you while little bit where I concerned call of allowance We've accounts come for It's we're more significantly. have would say reserve. a that down I'd there's of an one number overly doubtful seen not

didn't As any we talked concessions. unscheduled about have this quarter, we

communicating the just think I So trajectory. managing we're being with the also we're on right portfolio We're way in the -- Street. we're cautious the and

Juan Sanabria

then curious up to Merrill last And really the is about talk a ramp again, customer environment to of, the how and volumes you the on just the new versus thinking discovery Gardens year? occupancy drive increases Just you're if how rate give pricing could X and SHOP us operator changing. about sense business, the annual rate in kind of

Kevin Pascoe

Sure. has as the been occupancy really up. highlighted, mean we've get I to priority

look published you at that fairly if but see flat. you up the RevPOR is materials, slightly, So our

that's more a onetime occupancy concessions the push to So to as I been pricing the would characterize place been those. in it's get get

increases So normal our process. we'll in budgeting we're have still our

of whole we're to expect see that that matter that flattish using still, fact prepared would a mentioned I some of you'll think of little for in-place in lines is near which -- bit incentives would will occupancy push term. up, keep trying terms the again, onetime RevPOR Now occupancy what the I to we'll and along get my increases. But the something I on the in the remarks

Juan Sanabria

to then they've the NHI again, regards credit to wouldn't the on one thoughts profile latest stress the Okay. of and NHI we've and Great. that in about OpCo one, mind. with outside Any if you talked how of lease. outside Bickford, their risk last had. just stands given, And past

Kevin Pascoe

again. is This Kevin Sure.

we've bank some on prior financing articulated in owned that as properties have them. have do they think calls, I

difficult working So flow. little does on hard pressure right banking is acknowledged really portfolio effects. There silo are with going terms extend a maturities some Rates partners environment the worked of work over things again, need banking are to and off now. we've still modify I from our to as discussions in have They'll their up. right effectively some put those on of in But bit we've know that to next That or the those they're now. the year those they loans. they're cash so.

That I on So feel in our headed and stay They're tuned. said, like as they're we can footing the information. direction. better in now right show much

Operator

from next with Wedbush. Our question comes Richard Anderson

Richard Anderson

-- situation I'm here. The was feedback getting some

categories. Let of were you and of me the triple-net how how performing hoping? discovery, And the of [Technical it situation common you're turn that to it up they're rent off. parallel keeping Is draw both also you the knitting specifically the and triple-net with giving and sort Okay. sort they're why is growth of space? The kind some a operating with in asset? able in SHOP reasons the the in be Difficulty] how not sort quite on Would profile Discovery a SHOP of terms their

Kevin Pascoe

Sure. Kevin. is Rich, this

we the velocity portfolio far have to SHOP than also year one made So first our seen And improvement the step-up velocity little on had in rent for occupancy more triple-net -- and portfolio get so needed was a this triple-net will on reset, we it portfolio one Discovery, hadn't we the they've frankly, amendments that where is We've -- yet. allowed going to during more side. on the was SHOP made triple-net. for the this to where That note pandemic I just we be. that a we thing seen both the side of

some like where did interim, able over have be participation Bickford, that for to a repayments. then threshold get a the well some we up start we'll So of reprice. to out additional can worked the But time, period occupancy we're which revenue continue to has with looking momentum the allow to and we front just on in step deferral push build to we

it some So The fact markets. of some is not what the we local wanted see. is, I timing, of just matter of think it to is

improvement I that similar a on SHOP. the Merrill gaining of portfolio. Merrill the a doing occupancy are end mean, furthermore, portfolio. I within the seen out challenges more SHOP have We on good think would front of lot say, -- occupancy had and I in job terms Discovery

we're relationship. of relates I within outlier other So don't least terms SHOP they're partner to it at think, their some there as we have them just that operating when are in against improvement things focused an the on there. benchmarking

I of get properties the think getting finally going and needed in lot those we're time and there. direction, right attention a to

Richard Anderson

Okay. Good enough.

accounting question So maybe John. an for

SLC, of SLC during half all that others? mentioned all about You you rent negative just straight-line maybe rent portfolio the comment did make is straight-line few lease term. -- when the for you But a second of for negative their any net it together or

John Spaid

And there's always assumption wanted that comment. straight-line to been broader maybe making just positive. an is I No, that mention I was revenue a

expectation forward, So flip the negative. going it see to you should

Richard Anderson

past the deferred that's after recall opportunity I $XX to were this you quarterly rent good quarter. That's balance you when just leaving up Or accounting deferred that paid top tenants you're through on you can say, payments. then of go-forward flip doubling Is scenario a have going outstanding And know recognizing deferred that guys that not might this start doubling what's going rents I were rent did remains happened basis? recall Okay. correctly, open to modeling mentioned year in have not on point for at a the what some so on? present everything purposes. current the you third actually a that period million results you up back you treatment in, way of when where that along like get this to quarter scenario going and

John Spaid

provisions we to to transitioned from provided typical amendment the pandemic under So XXX. us relief lease

about beginning the some straight-line the our sheet how the talking of through would brought the on leases those started at revenues. And year, going to so very to during of balance XXXX, that to modifications are we be mean deferrals

the including at of of of Now cash transition we to happened things lot basis. had the a XXXX, very beginning Bickford

So given was sure again talk I more happening we of we opportunity and make the there. come But wanted that pronounced an of understand to deferrals. basically about didn't what sort results back and think today, you publicly groups X get have we to that

impact that We our our collect a that deferrals the GAAP are revenues being from are when have our received Those early have straight-line from of part deferrals that nature. variable tenants, FFO no are flow metrics. we brought everything sort on them, that basis we in of to revenues income have net the or we cash net through into income that FAD. But ones

So we felt time is and like situation results, a back our readdress it. this great come this highlight and to given

Richard Anderson

that's you $X early, right? million that so got And the

John Spaid

That's right.

Richard Anderson

anyone broad Okay. And room, then a in finally for question. just the

been some longer a would to than in X way if you were taking any had is back we recall it that be you fruit or track it do for feeling success about is if but ago? the was number, occupancy number, I the happened, the for know this to sort talks has you is, it happened magical or one stabilized don't lift Or where anything year But were X.X some tracking it's how level path But occupancy pre pre-pandemic. of about thought low-hanging get years recovery XXs that to you sort housing. except were know to the of high of difficult I expected you to that sort to get going of whatever that you thought? occupancy it ago, about senior senior housing. think You've fact back there's agree really the to pandemic. everyone

D. Mendelsohn

talking we year. question. head steady that fake operators, When increased of to lost a drumbeat agree were Good if of Eric. our December. the is steam. occupancy and This was of you recall, variant, last they I there be was would there kind flu kind sure more there occupancy were Rick, a And all another

quarter pent-up a that past this However, me demand. has there is believer made

one our basis portfolio have points XXX have If I points improvement you Bickford we SHOP bet me and in of of would would in against told that. over that in X would have quarter, X, improvement

see and a happens this what disbelief you your urge is for would So suspend trend. if I quarter another to

Richard Anderson

Suspended. Okay.

Operator

next Markets. Our Capital with from question Wurschmidt comes Austin KeyBanc

Austin Wurschmidt

Great.

balance million from from cash deferral and does balance, On or basis a cash basis? that only the just on GAAP tenants the include $XX a

John Spaid

was it again. everything. Yes. is Austin, John Austin, this right? It's So

Austin Wurschmidt

cash Can between that everything. of you percentage give GAAP-based That's breakdown tenants? what is us and the

John Spaid

We've Let's that. doing the been prepared call. I'm talking work about do not yet exactly But just to that. on that on

Austin Wurschmidt

That's fair. And math. then the just to wanted check

was adjusted So by million on in can is deferral offset the future push also Discovery the you in out the rent to you then Discovery, then to any the master that contractual XX% about lease decrease intend repayments? rent $X XX% to later a and share period? that with increase what And decrease for a

Kevin Pascoe

Sure. Austin, this is Kevin.

Their more, math period time. why on ballpark the of a in was significantly is more. original having lease we're right million for to the about there. step-up was Your hence, believe, And it then is master $X payment portfolio push lease out around, the I

ready frankly, for, partners So properties that the I sure step-up fashion just there. have to and looming want healed weren't get make that to we're appropriate mean they there's our to that we get and working an in was with operating a that, -- would

move continue to on looking front. let that the we're for move out a these time occupancy and So of period to

Austin Wurschmidt

SHOP for deals do kind market guess, senior believer. like able you capital? external housing think Board, existing And complete -- I kind are highlighted serves a to platform the you how as you opportunities the you're helpful. just, as I'm curious, and do acquisitions? then I executing just as cost on that's with SHOP of compete you're the now feel of of you talk Eric, No, close And for your you segment to a guess And in

D. Mendelsohn

what's think we've the can that we if of very, get They're momentum Board X happening even have buildings. positive like excited very some can more demonstrated of there. quarter we I about been visiting them been have and

interest intense a So of there's this level growth avenue. new an as in

Austin Wurschmidt

with on And would your the you look all just And me. expanding And partners? kind to just compete to new can then operators that's platform comment ability for today? existing your then you or also, of at

D. Mendelsohn

a Both. that. aware we're lot well of want out that to sign good of lease, There's don't a there operators and

So with with partner and better if markets. them, on or we better can them venture joint product

exciting to an I think that's way grow.

Operator

from comes Fargo. Siversky with Connor Wells question next Our

Jesus Garcia

Connor for Jesus morning. this on

of asset and couple for acquisition just acquisitions the quarters the been activity past So side, muted asset over has on developments real here.

more about So just talk the recent trends.

in chain I that getting think supply was of guys there moving. of the highlighted kind before difficulties stuff kind you

So of just just about stepping you think guys pedal And the obstacles? here creating that -- we is gas XXXX? and still kind should how on the foot fourth into quarter

Kevin Pascoe

occupancy, coming Furthermore, has with as not continued still, cap the grips where is incremental with have think line NOI kind improve rate dropping healing Eric frankly, -- been, I the to the but to environment. as followed, I people new Kevin. This of operations, there's NOI -- or to Sure. don't bottom issue just groups -- much has sellers as residents. The highlighted wouldn't as those

bit little So are impact I a with people they a think pro is think lot on of of stabilized community a look when like basis. forma that a what about there's wrestling

lot value forth prospective seller about in of and and is buyer between value. a real there's So what back the

have I a vehicle the point, good. is so think just deal, still is at to that a to But some debt ready That to or using at thing to maybe more sell. some looked forth. One and bit. we've effectively underwriting door little the truly as it disabuse people of foot there's building way this let XXXX season into our we've back back looking the which it are when speak, in we get they into and

to with structures partners, some different them. there ways I existing different operating But might working in our are. alluded what what -- get or on push/pull, are come to appealing are cautious on some going new -- we're and starting and and fundamentals to But being operating the dynamics the at think, underwriting try that looking to new are we're also, operator still starting operators is to, both as that forward. around So be Eric or just sellers

Jesus Garcia

And coverage the was color kind on the of on SNF switching the lift -- just a focus side. to there the Appreciate big there.

Any You the led parts overall? that specific the it's lag. tenant [indiscernible] situations XX% one operators latest side what's of in And your improvement from hearing you're portfolio or the occupancy, there? skilled guys moving quarter although approaching are such a sequential healthy

Kevin Pascoe

anyway, been bit both senior kind but assisted for on occupancy be coverage Kevin labor into still because the skilled to nursing. attributable just has and their little Sure. seeing housing them to portfolio how on their start very to The is Seeing Good -- of of lift NHC little again. This coverage. been the is in a bit. across that improvements, going strong. and concentration to their factors level see down biggest or That's out a spectrum

also very good news. So

federal I levels. states So spots. -- are There's few we're the seen that have the those in think bright on some we a both been that state and increases communities have rate

again, So there. good news

what's prepared in think comments overhang our staffing we addressed voices to just making bit mandates. for Think comments this devising with happen little and operators heard. it common the a their during period I sure the the it, plans are are going make is to and

operating if we overly there's, it with what with prepare they them be but just we are in we coverages the partners, making X seeing. So we're understand that. an they're would main not again, have and particularly sure But touch do overhang, given concerned, how staying for our

Operator

Joe from question with Our Dickstein comes Jefferies. Instructions] next [Operator

Joseph Dickstein

It accelerated roughly gears operators and just to you this could just be like would to agency great. touch a bit if costs it looks Maybe quarter switch OpEx. exposure labor your X%. on SHOP labor Maybe

Kevin Pascoe

Kevin This Sure. is again.

labor So you're asking specifically about the SHOP there? and

Joseph Dickstein

Yes, correct.

Kevin Pascoe

Yes.

of independent don't have in ton the needs. Fortunately, living we agency us, model, for a

if shift, bit wages get We to to to we're there's of terms have reorganize to having labor having somebody level of of that care of pay labor. that pressure kind hire a not But a nurses the pool given ways most or calls there's you component, across instead not labor positions. out agency having that Board have higher of of seen the in little in some a

what small So there really partners not and rate. think done is for one, big pay number headwind, roles, improvement to and legs the teams pretty revamping operating that job that is little good I really open they have making headwind. The But you're it's in sure our teams pay us I gotten having a a a just which they've have is there sea is have if seeing set. where need enough to been they the higher be, of think a occupancy bit the their filling the said, staff,

a So we're feel I in pretty place there. good like

John Spaid

the We've you're ratios elsewhere, that coverage a that's Joe, for your can Spaid. that evidence for John by I some behalf. improvements this and Maybe labor seen question better dramatic is through seeing Kevin, -- on Bickford. here tee-up in and of improved is

talk specifically can So there. more maybe Kevin

Kevin Pascoe

point item, we can X,XXX so mention business. specific One time couple where at a labor. the a relates down believe, like a in going where there to at it I looking or period Sure. of agency I guess, we in on Bickford, it week as was I most understand were in That's to of what's hours with almost recent now we their every look so hundred, week them,

for agency which from versa, what for one trend. agency the lot good is of we've make operators problem a recruiting positive. able our They're of to a vice agencies down. for that's very overall proxy side come think dramatic on usage start has I does caregivers not a our is the was while. a seen way that operating partners the But actually instead there, there other some So And a week trend of improvement with

it's seemingly quite settling down bit. So a

Joseph Dickstein

$X.X repayments that about Great. And then Deferral from to $XXX,XXX be should one kind just more basis, moderating be million for a million quarter. increased number How on last $X go-forward thinking this of to we me. or closer should lower?

John Spaid

in over on that in $X going my the prepared you for prepared remarks. gave We're million. I a try that to of to approximately deliver but So number quarter number, remarks my was fourth

Operator

questions time. at further no are There this

D. Mendelsohn

today, us we'll NAREIT next Thanks, everyone, week. of you for at joining see and many

Operator

line. the your please call for That for conference participation does everyone. great and today. Have ask disconnect that We conclude you thank day, you your a

National Health Investors (NHI) 8 Nov 232023 Q3 Earnings call transcript