March move-ins across Capital Senior Living’s 60 communities are on track to be at their highest monthly level in two years. The uptick indicates a rebound in demand for senior living housing and services, President and CEO Kimberly Lody said Wednesday during a fourth-quarter and full-year 2020 earnings call.
Acknowledging her colleagues for “relentless dedication” to the safety and well-being of residents and staff during 12 months of the pandemic, Lody said the company’s three-year plan for improving its operating performance and financial foundation enabled it to adjust its model as needed throughout 2020.
Citing the company’s transition to a portfolio of 60 assets with a history of strong performance, Lody described continued efforts to secure new talent and build a more efficient operating strategy. The company also has exited all of its triple-net leases and underperforming owned assets in an effort to reduce liabilities, stabilize its balance sheets and begin to stabilize general and administrative expenses, she said.
Occupancy rates remain stable
In 2020, Capital Senior Living’s year-over-year occupancy declines were approximately 35% better when compared to its senior living peers, based on publicly available data, Lody said. In the first two months of 2021, monthly occupancy across the 60 assets was stable, with March numbers expected to remain consistent with February at approximately 75%, she added. Currently, spot occupancy across the company’s 60 assets is 76.1%.
In addition, the owner-operator’s 2020 year-over-year decline in net operating income was just under 13%, compared to an over 20% decline on average among its peers, Lody reported. Leadership retention and overall staff turnover made significant gains in 2020, the company said, with total annualized turnover improving 4% over the previous year.
By the end of the second quarter, the company expects that its Healthpeak, Welltower and Fannie Mae assets will transition to other operators, leaving it with eight managed communities, down from a total of 18.
Vaccinations brighten outlook
Vaccinations have sparked a notable improvement in business operations, with leads and tours beginning to rebound in December, and move-ins and move-outs starting to stabilize and improve in the first quarter 2021, Lody reported.
Among residents, 87% are now fully vaccinated, and the incidence of active COVID19 cases is nearly zero across the portfolio as the last of third-round vaccination clinics wrap up. But staff member vaccinations are currently at a comparably low rate of 41%, in line with the staff vaccination rates for the long-term care industry. Lody said her team is continuing to work on employee education about vaccinations.
Moving forward, the company plans to expand on its overall vaccination success by accommodating more in-person visits from family members and enabling larger groups of residents to meet for communal dining and activities.
“Despite the last 12 months’ difficult operating environment created by the COVID-19 pandemic, we have made great progress on our three-year strategy called SING for stabilize, invest, nurture and grow,” Lody said. “We feel good about our team of colleagues, our restructured portfolio, our improving balance sheet and the improving post-COVID operating environment.”