NHI - Earnings call transcript Q4 2024 | National Health Investors, Inc.

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

Operator

Good day, everyone, and welcome to the National Health Investors Fourth Quarter 2024 Earnings Webcast and Conference Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Dana Hambly. Sir, the floor is yours.

Dana Hambly

Thank you, and welcome to the National Health Investors conference call to review results for the fourth quarter of 2024.

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

covered well released the yesterday conference after press that's as conference of in call, notice media. release were financial historical call the been forward-looking which as are results in facts, accessibility of this a Any not The statements the are this statements. by market closed

judgment date NHI that any All or this not are and future cautions forward-looking performance. risks the investors guarantees statements forward-looking as conference call. NHI's represent uncertainties of statements may of of involve

Investors NHI XXXX. are Form NHI's Commission, other filed Securities to made urged and carefully review XX, in Exchange and with XX-K disclosures various for and including by factors disclosed reports the the risk its year periodic information December the ended

these website available NHI's of filings on or SEC's at sec.gov the website on at nhireit.com. are Copies

have addition, the non-GAAP terms and in earnings are together those release In and are in encouraged in reconciliations X-K to Listeners financial with review are release measures, which furnished in call that tables provided used information of which to provided the other NHI's been release. provided certain related all SEC. earnings on Form this reconciliations schedules,

Mendelsohn. turn over our now to I'll CEO, call Eric the

D. Mendelsohn

the and across year portfolio. Hello, We with results quarter everyone note us as fourth from ended joining on today. to thanks for the the strong expectations a exceeded contributions our

ramp-ups our sheet X.Xx the and quarter end investments of helped continued of leverage as which announced rent ticked in nearly $XXX occupancy at of solid X.X%, third repayments by growth from X% deferral growth increased generate year, cash from as on the to the X.Xx Our during the yield activity. to and increased year-over-year quarter. million well NOI accelerate we to XX.X% SHOP down investment an initial organic balance while over

similar benefited year's Reflecting trends. we from the on full results,

approximately repayments total $XX included mainly our high Our of meaningfully contributed above and SHOP in Bickford's basis of improvement. to hard by XX%, This by in the points during performed growth million XXXX. occupancy approximately cash the income. deferral which driven improved work over XXX and XX% increased margin was guidance, rental portfolio optimization end NOI

announced an of a This year million since capital over our average and $XXX is yield we most approximately was clearly at perspective, allocation XXXX X.X%. the momentum From building. active

in a growth annual FFO NAREIT first normalized FAD since As for and the company XXXX. result, FFO, time the delivered

not his provide February the linear, end And the comments. we in original for our while of more guidance details is will John year. that growth high exceeded full

as Looking expect XXXX, to forward we growth continue to reflected in guidance.

a noted bolstered the our step-ups rent moment era from effects As ago, COVID resulting and restructuring. results of were deferral repayments XXXX by

accrue benefit growth. to other While to internal the looking XXXX we still support from expect are avenues for we results, financial some

Specifically, we're housing existing new to considering structures to SHOP excellent select operators. where assets senior transition we potential see with or triple-net opportunities long-term

housing exceptional senior The has industry tailwinds.

flow and improve to cash estate believe we increasing working partners this higher way capital-efficient exposure by a real operations our overall with strategy to generate strong and shareholder to senior So value housing is greater valuations.

to our increase strategically organic XX% plan we margin growth expansion. RevPOR continue to XX% also to drive close existing in upside After to we're XX% see at XXXX. with XX%, in XXXX, significant operating portfolio to to platform guiding We further the SHOP NOI

remains very proceeds opportunities. available approximately raising balance in investment last the net funding settle. The sheet $XXX growth. supportive shape significant We a in be external to by on outlook our and equity year were of approximately advantageous able to of million of is on forward $XXX markets great to basis Turning million

of are high including near-term our conviction in his reflecting guidance, detail incremental will in the comments, our investments John we $XXX outlook. As million in

be pipeline January I'm we'd I XXXX. We that, we in beyond say the in sale to active year's that in investments of did pleased start surpass total good any of closed $XXX million. not approximately more including not million have off an LOIs. million. And we we're very even year. a $XXX.X it's to We're addition, XXXX, with that closing, disappointed $XX.X While if think last leaseback productive In will $XXX.X million signed in an execution optimistic have and under I'm be XXXX safe

than to environment industry the have either other senior rate on recently housing to the their or capacity we exited sector more back have has capital the interest capital, weighed scaled still entirely. the [indiscernible] and of providers the ability cost who While quickly exposure

of advantage senior take in in history partner fundamentals we're to convinces that of the us of early the as the industry multiple is of rush which competitively operators growth. the exceptional positioned most of years days favorable As NHI housing, choice,

Before the upcoming and call comment The Annual X has information Meeting. buildings received nominated over, which Shareholder the Directors I from briefly seriously. to election want filing company turn the our Board to recent shareholders the of Board very I and land at on in take for candidates

reflect response years, the its Board shareholder such, its last to over changes significant As fiduciary concerns. has responsibility to which commitment and the made several in direct

call interest on you'll provide more our We over on further operations. to appreciate hope no and understand that that comment this matter. everyone's now turn details Kevin I'll have we Kevin? the to

Kevin Pascoe

of and million yield Since call loan initial of Eric. at average X.X%, a announced have in million estate This XX%. average at yield X%. real we an in at investments of million acquisitions an included last our $XX $XX.X Thank November, you, $XX.X

$XXX.X have half in Board that year. an this in X.X% deals to of first close approved million expected of We average with yield the are

as sale includes options. as of acquisitions and real estate and mortgage construction loans housing mix well senior purchase with leaseback This a

an in deals. also investments, portfolio closing XX deals, this have of including in pipeline which figure approximately million the included actionable SHOP $XXX a chance Not months. of reasonable have We next within are

Senior partnership asset want a master comment Living. Discovery Turning in X lease with I management. properties to to on specifically on a

of minimum of on XXXX, a to yield this recall, X% investment. May will a we XXXX November you X, a gross As lease reset in scheduled amended with

we transitioning generated another the the including buildings repayments. in have evaluating While $X.X million These deferral to base million several properties NOI seen have options, XXXX rent in expected, performed as properties so $X.X are growth, not approximately and we operator.

While a the currently slight made, increase no we not final have rent, model XXXX levels in decisions the amendment. but base been in to contemplated

we We a on more provide to expect detailed as this portfolio update our evaluation. continue

quarter improving cash Now well the growth. turning coverage another and as results. solid from had as acquisitions We contributions and good with shop to collections EBITDARM

rent was in in property the of with now million provided again quarter. the recaptured William and of the coverage had We in the positive this X.XXx sold operators we $X.X cash the portfolio rent SLM tenants in for the of improved Bickford fourth X April leased EBITDARM X.XXx. the for at sequentially to on portion properties end X to needs-driven and at during Group financing X.XXx. Of need-driven X April Louisiana good was are remaining NHI NOI year, adjusted $X.X The significant progress coverage reset will XXXX trends million which a transitioned coverage made James that October from proceeds, commencing X, the X.XXx, while properties, by X.X% that in have other triple-net with repositioning expect of was XXXX. effective January net

to secured we $XX our Earlier mainstay. in our this leading month, property million ownership mortgage Florida took that of note the

We mezzanine and on a available. tails substantial we are will evaluating more $XX.X still loans million provide the which when on carry options reserve

of had portfolios Our our coverage fee continue performance. entrance entrance great sequential skilled portfolio includes nursing portfolio, which discretionary fee X.Xx show the to The X.Xx and to in senior housing period. compared

coverage at level coverage is as the solid Recall which EBITDARM. charge level opposed which is driven SNF the that X.XXx, coverage reported calculated X.XXx. sequentially to by a corporate The portfolio fixed improved a largely NHC, at using facility SNF

$X.X NOI SHOP, continued the year-over-year throughout year-over-year, the million. increased in XX.X% momentum basis of X.X% XX.X%. by Lastly, the saw driven XXX we by Resident improvement fees quarter. through increased fourth occupancy to [indiscernible] year

was improved quarter margin second basis of the points XX.X%, since strongest The result which the XXXX. XX to

driver target margin as occupancy we starting to portfolio the strategically expansion. XX%, With to growth the approaching RevPOR primary are

the points. increased XX basis For RevPOR quarter,

small, While RevPOR we the SHOP platform. increase operating largest this since the actually was started

growth for expected long ] XX% points expect we the target over term, show to normal plenty NOI of basis the and foreseeable is SHOP improving XX% see patterns We in future. to NOI seasonal dipping with elevated occupancy NOI and portfolio throughout year, year. of expectations The XXX growth improvement first with for margin the quarter the the runway in [ organic and of and this upside of

I'll now John? guidance. financial to discuss over our turn the results John and to call

John Spaid

Kevin, everyone. you, Thank hello, and

common For per XX, share our the XXXX, ended year year. the was income prior net diluted $X.XX, unchanged from December

compared to and $X.XX prior respectively. diluted year increased per Our and ended the periods, quarter December $X.XX, XXXX, share common XX.X% NAREIT for XX, results X.X% year to and FFO the

forward In that the recognized our I'll gain a nonoperating in fourth ATM this to FFO. we quarter, about item equity and talk related $X.X in NAREIT income activity is net moment. a more of reflected million

to quarter as normalized Our and to $X.XX, XX, results and year compared common increased share ended periods. for and December year diluted the $X.XX X.X% FFO the per X.X% respectively, prior

prior ended year the quarter $XX.X to XX% million, million compared the to X.X% ] to for the [ respectively. $XXX.X and third for year periods, XX Sequentially December also attributable increased compared FAD to with the and new quarter Arbor the million, in for rent acquisition, largely but sequential fourth Spring associated collections. rent due to different higher cash quarter, portfolio the increased $X.X $X.X [indiscernible] million and

prior to losses to lower were increased partially to periods. for year XX.X% default. prior December NOI and to and including $XX.X respectively, ended other the the SHOP offset from $X.X in the changes, cash million, our by $X.X realty the $XXX,XXX compared increased year. million and portfolio SLM year Loan Those XX XX% the million and for compared quarter year attributable increases rents

to to The related increase SLM loans due increased mortgage default. on was primarily the and the the reserves

gains assets During the recognized previously no classified the that held and sale. from classified fourth The company year for quarter, the $X X held estate. for were in sale properties of in as with ended we million real properties sales disclosed

an we yield $XXX.X of For the million year, X.X%. made of approximately at initial investments average

$XXX financing price overnight transactions totaling approximately proceeds at a included of in on before million gross common Our million shares activities fees. X.X $XX.XX forward

utilizing We recast additionally extending our We in our notes XXXX. million revolver. into from date million $XXX senior maturity the facility's also proceeds retired revolver, $XX

earnings $XXX.X closing we investment, call, third mentioned million in X.X August our after previously offering quarter for the in we under overnight delivered equity Arbor Spring million X our shares proceeds. As approximately

be mentioned, investment continued to $XX and active. previously January additional through an average yield year, of million we Spring investments closed As we Subsequent our in to X%. the an activity very of closing this Arbor

share. per during XXX,XXX on a average investment at of sold and our pipeline before a fourth fees basis, of As an result forward we shares ATM $XX.XX the activated our quarter, common price

the at $XX per we fees, mentioned investment ATM for the XXX,XXX common at we of proceeds after adjusted approximately an year, As share additional million. activity of end close of settled equity just shares forward of the the $XX.XX forward price

common the shares results, Including operating I escrow, gain million $XXX.X total available $XX.XX price proceeds equity us share. overnight equity ATM the of forward in of average remaining per of our associated activity. forward proceeds of delivery an equity the mentioned of the with agreement at the the fourth on approximately $X.X end recognized at for quarter in $X.XX August million escrow future forward sale my summary exchange we had of to in year, equity million

classification the the accounting accounting capital retained equity some equity from all recognized was raising to treatment the requirements income the our time the moves during This arrangement via we quarter. to earnings during forward because The is deemed game equity were of statement. in satisfy for equity paid not

should be through it's viewed and So lens. and more that presentation substance

sheet ended fourth in shape. Our and the balance quarter great year

adjusted within net Our leverage policy. X.Xx to quarter, X debt fourth EBITDA for to the our stated was ratio Xx well

capacity. million of million ATM our equity in $XXX availability $XXX At proceeds [ January, We continue mentioned, we remaining as on had the I $XXX And the have approximately with ] available end we million forward to revolver. ended year approximately in of us. available to

and maturing we as continue our debt. focused of plan XXXX, make company's retirement investments on we're to the needs for For the liquidity

exercise XXXX maturity extend into date to XXXX. to intend million. other totaling term We maturing our our $XXX.X $XXX And right we million will debt loan our retire

to rates We in expect bond long-term public liquidity. XXXX are our to monitoring improve bond market continue the tap to further and

and Let dividend me our guidance. turn now to

March last XX, announced of declared for payable our Directors our May night, we we XXXX record shareholders dividend a $X.XX also full share per and issued As year Last XXXX. of night, Board XXXX, guidance. X,

XXXX. or share guidance for and respectively, is Our per the X.X% FFO over $X.XX increases, midpoint FFO diluted NAREIT X.X% normalized common and at

Our increase X.X% guidance $XXX.X million at for FAD the midpoint XXXX. or is an over

from year. during forward equity year proceeds impacts the this escrow guidance Our the includes

So because our to we equity. XXXX activity. raise unidentified future led are in us on confidence forward investment pipeline has significant in our our guidance, Today, view our including

in Our XXXX at yield guidance includes new of an $XXX million X.X%. average investments

The timing generally for In we for is a may to year. assumed should investments future, unidentified we occur the discontinue equity the ratably discontinue investments obtaining over giving basis. the forward guidance on

growth includes to in XX% over the of XXXX. SHOP NOI Our XX% guidance range

Our continued includes the of existing property in step X, also up. annual and May Discovery increase of guidance the rents [indiscernible] collection includes rent rent for NHC our It the deferred our assumptions commitments. percentage preliminary fulfillment revenue the XXXX,

X% anticipated we under do revenues. target The the result in GAAP rent from not NOI will believe Discovery likely will lease. able the the set lease in yield change to be expect We Discovery base the meet increase portfolio year modification the this will portfolio's but

to assumptions additional and concessions repayments. dispositions continues to for costs asset and normal management include guidance Finally, transitions, loan related

thank So for That joining all our call once again, today. concludes prepared you remarks. our

So operator, with the questions. for please lines that, open

Operator

Instructions] [Operator

question Rich Wedbush. Anderson first from coming Your is from

Richard Anderson

So triangulate for the your you of much that generate in how sort if generate in you XXXX? of income rent did guidance? could you inside And XXXX how interest just John, do to and on the much it expect framework SLM, me,

John Spaid

So talking interest rent? we're rent or just about

Richard Anderson

nut, and whole The rent interest.

John Spaid

to quarter would So sanding end our when and -- versus of basis interest probably XXXX including over XXXX. rent say, we the full get XX%, to the year. full closer year quarter in full -- loan, be

Richard Anderson

Okay.

run by fourth So the quarter. rate

John Spaid

But yes. of more still and the the this, Yes, talk improve can about could state mezzanine in materially. Kevin that loan is flux

Richard Anderson

be in, Before to Kevin it Would just jams what [indiscernible]. about closer on rent?

John Spaid

of XX% get about be I to Right. was To rent. to Yes. trying that.

Richard Anderson

$XX.X guys at any it's Okay. the a comment more million? can -- piece? TBD on there, mezz moment, I And but you the know color

Kevin Pascoe

is Kevin. this Rich,

sale is easy but said, with in execute they a on are right now SLM that producing like, is you going to we're still them look negotiating As a it's that but at assuming not are a the properties, company, what several there alternatives. on distressed through few would particularly there looking TBD, We know NOI. financing We're process. sale come that by, terribly recovery

in So opportunity want terms of we -- know. or terms to my if with. have alternatives we it's some there dollar of that size don't expect We're expectation Is and of looking element we We're step for that is can to do? recovery. to buy at us we in help a work still buyer a what in a prospective somebody

on got we've still to continued. it's lot So so of be a -- options the table

John Spaid

credit an do then I make bit the one if we're redeploy to comment redeploy it loss would the proceeds. apples little we of our go equation right as could cost the more collect least, principle we and you our it's if some down our collect can about revolver. to But and course, think trying -- would we we it. pay reserve to got very X.X% I of now, how depending is a At And loan. principle, much collect, what can recoup oranges mezzanine that on of on then

Richard Anderson

Okay.

on Second and a level. It's over guess not expires the But X-handle it's on buildings, understand I talking I question, to you're at It's corporate land soon about XXXX. too Xx on talking the about that. I be a not it. in NHC, so property level, know that. got that

markets what maybe lease fair get comment the in in those may should would terms in deal mind coverage you market market You assets be will. But not on of expiration? what's out a that of you your for appropriate that, their

D. Mendelsohn

robust market They're The markets. very good is buildings. Rich, this is for in these Eric.

X.X on be or interested for lease, room now a is have in trauma some with active And other retain And the account NHC publicly-listed market FF&E to having CapEx discussions parties. there's opinion, and and to a personal costs we're maneuver with their transition does NHC operator, the property, have new X.X, have so you'd there. my Our coverage, would transition, but [ you'd right and ]. publicly in all to under lease. this NHC

Operator

Your next BMO Juan Markets. is question from Sanabria from Capital coming

Juan Sanabria

the of Eric that, by if about you at call, existing could guidance expound made could the triple regards the behind the comments It upon XX%? assumptions And about to to piece sounded SHOP. regards SHOP, hoping from as of XX% maybe occupancy to net with Just with top behind the to like some transitions. to in you of talk part rate parts then considering operators

Kevin Pascoe

Juan, this is Kevin.

year we the of terms we're note. XXXX. we over a throughout In Feel good high year, how momentum performance SHOP ended on at looking for the like had

prepared As momentum looking in able our the we on quarter. back some remarks, at that in first also seasonality And to over we're talked the the throughout in period. occupancy year RevPOR balance then push being we have about of getting

as So we to structure opportunity grow to cost savings we're mentioned we be operational XX% where the and continue can be there. evaluating There Overall, some on up when see reducing that that and we think year. there more some take might pieces, might year-over-year the improve it in it those to burn talked and basis. play, here XX% some going bit there a again, though, off, that we is it how more a a higher. a little continue of be see revenue climb the incentives bit we'll throughout is continue about We're of RevPOR just they the quarter-over-quarter. to it to going looking and We lot to

think help also We're that to pushed better CapEx buildings, able of we've as we continue about which forecast and that. the were these how into got performance. RevPOR to the continuing put I year thinking work be So some our with deliver building to portfolio. we can where we think to do for delivery performance. that's I will just We've to look I go operating still on partners more this mean at the

Juan Sanabria

comment was like disclosed Great. second Bickford. a just And in the could deterioration year release. in It you that from pool looks the the the the I the of you then from same-store occupancy late summer on hoping half saw press

Just loss what's any concerns that that driving or thoughts pause of momentum. around or

Kevin Pascoe

I just a standpoint. in a they out move so of forward -- had there. rate -- increases couple One, you a their there's things point little price of little a bit think from pulled there's

for well a Bickford of creeping the have seasonality On the in winter whole started that think I then though, as look in at there positive some it's NOI net from portfolio. you still months. the And some

think they year. I be So delivering price for are higher at It's a point. going can be They throughout the higher still successful to acuity known care.

So deliver. move in that's We're that piece maybe they've that nice out, seeing the that to to a selling the some they that done in of the affordability job. nice But occupancy continuing care of edge I the you're a were really of do decided people moved terms on but part of job there. really think

Operator

question next is coming Omotayo Bank. Your Okusanya Deutsche from from

Omotayo Okusanya

can $XXX million bit the a million of another little $XXX of guidance still it build understand sounds the you us a pipeline kind a you bit or reconcile you have million hoping $XXX year? like of help little plus $XXX million, ago acquisition better. versus when months especially me help million in but guidance XX in LOIs $XXX you Kevin, trading just So could and that have

John Spaid

Tayo. Sure. John, This is

one. Yes. take that me Let

under LOI. to our our they're expectation But number in properties in LOI. is So those close the a guidance of

they're not yet. just agreements definitive So

be guidance. So going in we high to hit our to have confidence of the number that a degree we're able

well we that's additional to weighted Our sale a how guidance as of as mortgage yield. the leasebacks -- got loans average combination is

our right, under to number. bit guidance. in that a have our more you're than deliver promise on in pipeline and expect quite we We over And

some upside So there, there's clearly.

Omotayo Okusanya

second Okay. And on question also That's deferred then rent helpful. collection.

$XX help of you as us could do well. If so. million that or The balance

You collected in million about $XX XXXX.

into upside Just there's as if of help us any big well? understand what's kind there XXXX, and potential

John Spaid

guidance operators you quarter primarily Recall of that and that $XX line saw the some But they credits million includes our Yes, in exceed credits. perform are on -- might fourth there get equations generally, still the in performance, that is for if upside. some is the collection what some with the deferrals or deferral Bickford.

me -- there are minute. Let of we what over $X million a a quarter little million ahead back a up $X forecasted. was quarter. fourth approximately little The Actually, a

Omotayo Okusanya

the about in million So XXXX. you $X 'XX million $XX have from baked to for relative

John Spaid

That's right.

Omotayo Okusanya

slowdown And the for is. the reason big

John Spaid

depends of in quite source right? was it deferrals, XXXX. the Well, there the repeat collections a in on very looks few That to And extraordinary difficult XXXX.

were XXXX. Discovery think example, $X.X up in be paid including to going others, are don't There number. Chancellor repeatable that For that from some we million some

just -- now. just guidance that's that's So right our

Omotayo Okusanya

helpful. kind play go That's Can help it. Discovery, more given kind through of expect comments the play that, the out? out earlier profitability not were Then do kind for where getting need us you right different you just Got kind scenarios get one to about kind expecting? to to that road. quite for you ultimately -- of of how the of just you of some the to of reset

D. Mendelsohn

future Eric. of regarding question the Tayo, this Is collectibility is of payments. deferral the your

Omotayo Okusanya

It's a and get of of the date. also to get the or you're things. It's reset expecting -- if deferrals reset couldn't not at going direct the the the you future both combination

term, to to conversation Just else? operator? think in continue this kind idea see you someone expecting you're going I was transitioning for be would of scenarios are What to like? that you about of longer trying some rent potentially to think anyway, -- but portfolio. a the guys that there going Do step-up ultimate to where you look of an is

D. Mendelsohn

Right.

Okay.

deferrals reset and question to is who -- then hurdles resets rent yes. your operators So and the rent make aren't able then

at point, we investigate re-tenanting So the either that would building.

result instance. that is sell SHOP re-tenant one so an as building would see of RIDEA everything table and building in our to problem. in -- to it prepared building. the that we're that's analysis converting one doing we said or remarks, And that on the you also group it's if Sometimes greater one or a buildings in Maybe NOI

Operator

KeyBanc Austin Your Capital next is Wurschmidt from Markets. from question coming

Austin Wurschmidt

positive unchanged. kind $XXX guess break of investments. pipeline, the continues pipeline you from But and really then under very kind that around commentary investment in it's and out be million quarter, what's LOI the when of Eric, I last future to

just be basis your right where the is. you level thinking on is confidence backfill a what to that So about curious size what we the that And continue kind pipeline? pipeline of level can that future should

Kevin Pascoe

you is similar Kevin. million would I this the it's a tell opportunity that we're set. it's that at you're when Austin, looking $XXX quoted, size, but a right, different you

continue look $X we bunch of at churn opportunities. any again, you can in if month-over-month. at I which, given billion tell looked to week-over-week continues different that at, We at terms a we're the it's looking total funnel, what to time. of and

whittling So down those the moving of from in then I we're ones seeing on opportunities think that feel It's pretty just that not. are good front we the that really table us. to about it and

of ones stagnant So [indiscernible] tell with to just pretty certainty to and down are kind you number, I month it we set the new but like may week each that a look actionable. that you can a opportunity it's think

I pretty today, sits our about market the as feel good So outlook.

Austin Wurschmidt

those mean That's helpful more what opportunities? that, of care your with to you're includes you size one comments. I opportunities that number opportunities to confidence up, that of the maybe of respect And is or level the pipeline, or I to guess, that investment portfolio volume larger and outside close would able then

Kevin Pascoe

about or is talk are in we say included are not Well, know I the SHOP what what different remarks, than deals which or other portfolio from not -- our in can we than deals talked that don't anything investment pipeline. prepared about I

we're looking As at a dollars I any at of worth of just couple billion time. given mentioned, stuff

get but not we to you I good the be the So guidance a where would change path on to give that based the able on company. a us about meaningful those, at place of for feel opportunity we're down something want to some be to pretty

So back that. on holding we're

John Spaid

John. Austin, this is

cents a accretive. that. quarter, Let that's two the of lot bit little been capital recently. deploying to a and everybody's we're and of to very In in capital, movement fourth There's cost sensitive me add another

always it, looking and about the So if at set you long-term we're the price. opportunity interest think then our and stock rates

of capital set that here the basis. And out opportunity penciling recently, accretive on seen well so despite of some cost still increased is that an we've

Austin Wurschmidt

the could question. then last got a did that night I Discovery in-place SHOP over could think And highlight how or with I'm just the looked be And maybe gross bit But the that opportunities. for perspective and helpful. new NOI all or asked a of one potential from an triple if That's This, just investment earlier operator. little me. consideration conversion are presentation last big a assets wondering not for net you size whether conversion up a I

D. Mendelsohn

possibility. portfolio Yes, is Discovery Eric. is this Austin, a definitely

And so are others.

a other running for our office, operators be We we're have one at, that criteria good partner is of currently back have and are a which for would us strong RIDEA portfolios other looking REITs the to start RIDEA journey.

Operator

Kilichowski John next from is from Fargo. coming question Your Wells

William John Kilichowski

talk about elevated any the I associated those. about going transitions question sizing time know there's that earnings how impact transition that and to of with the CapEx last opportunity, some SHOP and back just some here? Maybe probably

guide 'XX? if sure there's to through roll not likely I'm this 'XX So or to maybe will upside if

John Spaid

to as it that comes ultimately trauma transition a And Spaid. earnings very sensitive said, to like and John, Yes, you down fact. matter CapEx requirements. growth, of this is growth, we're John NOI

sets So vary depending ratios the opportunity the rent. current on current over coverage the

could So trauma. that EBITDARM, a transition very new be that's but accretive -- there's there's transition a obviously, whenever something going no -- well to covered, if be operator, suddenly to convert some trauma, we there's if all there's

and properly expectations then, well. you. continue what course, And we'll through communicate as that requirements that work So our are also we'll of to to CapEx have for the

a is So different. every little opportunity set

William John Kilichowski

what maybe in portfolio? might all What guide? And pipeline then you total when 'XX about including how your the SHOP in then does start And of terms end in set. your total like exposure Okay. the us look opportunity shop of acquisitions help understand

D. Mendelsohn

of see portfolio I early Eric. our end year or by is could XX% X% it This to this year. of being next

Operator

question next of Your from is coming Farrell Bank Granath America. from

Farrell Granath

curious your was looking you nursing your pipeline, portfolio acquisition skilled to all just in of I terms expand are

Kevin Pascoe

getting an of We're price opportunity with This right a the operator. absolutely matter is looking. at Kevin. the right It's just

We have pretty love from That and would them. has we've of around and very expectations We frothy, now. been rigorous in our with pricing more credit perspective, skilled the a been of do said, our to nursing we coverage. think, market operators good underwriting criteria terms pretty

would haven't to we percentage up would look. but portfolio act that look. a [indiscernible] to take a were we I little to again, something in we -- anything now, of we we haven't bit get to right So But our if love lately that reasonable just investment size ready it's continue seen of absolutely but seen opportunities, we see could add. on, those

Farrell Granath

I a with get through with your just Medicaid, news, having hoping vote. any how your current Senate on was possible maybe business And the or impact their budget And negotiations? what in a then would to budget that the going thoughts House passing outlined few own your Great. comments cuts forward to the

Kevin Pascoe

This from to so Kevin those to again. up That what it's it soon explicitly bill. is tell. seen watching programs. It in affect be something I've not may said, It's the too Sure. it's, that think, with far, I we're outlined seems teed

cool heard of Washington. have going understand be sure Anecdotally that interest intel closer make resources buyers' the or and working is our and though, what's to we've we'll from not on So other and terms market with we pricing. what resources our is that in nursing our operators other in skilled of

it robust pretty goes. that date, a remains still to But So where market.

Farrell Granath

Great.

your assumptions do baked guidance, any me for debt you have -- or more one in? about loss bad credit sorry, within And

John Spaid

certain X grown in got We year always And And over taken we mortgage going XXXX, last to keep say, loss a right receivables X%. be you in level and as do. reserve growth. have mind, that that to grows, loan of to our credit at against XXXX years, do, there's the

mortgage which so growth, assume guidance includes continues And our to growth loans. in and

Farrell Granath

And of point a sorry, associated is there sort base with that?

John Spaid

No, number, you. I sorry, bit about talking mortgage mezzanine There to little have but that don't a is squishiness of in depending or we're loans there's on loans. for there, that

average an basically it's number. So

a years if just loan and of I growth were and then look But what was go an of good mortgage what year get think use unusual like, -- you portfolio look back then CECL you'll sort and is because SLM average the do at reserves. might XXXX make a our the couple should assumption our you pretty number. an reserve of on to of

Operator

from coming BMO Sanabria is Markets. from question next Capital Your Juan

Juan Sanabria

Just going investments. and back SHOP incremental to

potential to an be John, transaction. a of illusion I think, transformative made you kind

So you does platform, of that to to that mean I'm tease like investment? so out at bigger a a of you as part where oversee kind looking to a you're just buying potentially speak, that trying implied SHOP asset by that. management what have capability

John Spaid

remarks really not difficult I transactions would difficult. They're included are remarks too, about out talk are hard and determine or is not implication. some at thing Eric's no, large shop. that I don't Kevin's are that portfolio so made guidance in numbers. fairly to whether to us think I for And real One it's we that pipeline those. They're transformative But so those my so in was material. they're yet looking really point in our any not

Juan Sanabria

a what's guess, as about strategically a under Like being the I talking contemplated for assets structure, are it guidance, in is is more necessarily SHOP is platform? Or question. but just business? it the I that wasn't what's

D. Mendelsohn

our Juan, say this more this We're it's would the or point pace and Eric. to that would almost pool. of year. talent been management anyway, last year is we've add Xs definitely doing portfolios, now that acquisitions at Xs. We maybe just I asset smaller

$XXX year. overhead a to That's cadence spot. million make portfolio the and a and Xs was our [ you and headcount we'll adjustments before That's along deals. So sweet the and our know X lot $XXX million way Xs appropriate of usual pandemic -- ]

Juan Sanabria

then a strength prior are without conversions out position net to SHOP of those I leases being or contemplated done to a or conversions. any a triple dilution coverage. from the about Great. potential follow-up around of conversations or as great is guess, question strategies meaning just And weakness, the

to confused -- under tenant a bad with would they're give money if a Just they upside release that rent the coverage have. I'm in why choose the

D. Mendelsohn

That's a fair Juan. question,

of about lease coverage SHOP, we convert definitely to management bonuses a and is on reason wanted have there a absolutely promotes and or fee. to If and profit would it be there they to to conversation is converting strong meaningful and place that. The sharing You're that right. guarantees be have having in in would other credit probably that though less to or mean that them people would is SHOP personal conversation interested

breakeven, of you're not both it's partner or that CapEx can and do new would a strength weakness, in conversation just lease -- based changing about about that it's the joint a us to for mean, all have well. need and what position we looks from isn't right venture above whether the a on improve whether as it's So whats I a like, that. or if conversation instances, out have might working or the operations of is coverage a then operators, we

Juan Sanabria

that last a And is Is kind or intended has has to one over the the Okay. type CapEx power just deferred and of one been asset? like sharp help The be number. for there for CapEx CapEx or guidance of redevelopment is spent pricing above spent anything to -- more quick me.

John Spaid

that's is. is current our to deploy a repositioning that $XX we're to at a assets we're There There improvement. those get And SHOP to in number portfolio guidance that The in The our is. recurring million. number number. is CapEx NOI continuing closer

Operator

go That now conference ahead. the Eric closing hand concludes Mendelsohn, for Please back Q&A session. Officer, remarks. Chief I will Executive our to

D. Mendelsohn

your Thanks, everyone, investor you conferences. today, we Nick forward and seeing at for attention other look and to or time

Operator

Thank at may Thank have participation. you. wonderful this Everyone, a your you you disconnect concludes time, day. this for and

National Health Investors (NHI) 26 Feb 252024 Q4 Earnings call transcript