Scott White

Although they said COVID-19 continues to create a “challenging operating environment,” Invesque executives reported Thursday during its second-quarter earnings call that the company has seen a significant decline in cases as its operators implement phased reopening plans across its portfolio.

As of Aug. 7, Invesque confirmed, 70 of the 106 seniors housing and skilled nursing properties in its portfolio were affected by COVID-19 based on positive test results for residents and staff. Only 29 total residents were being treated or quarantined in Invesque communities, making its current rate of infection significantly below peak activity observed in mid-May. 

“Considering the size of our portfolio of almost 11,000 beds, we were pleased to have so few active cases at the moment,” Chairman and CEO Scott White said.

Cases in the skilled nursing facilities are direct admissions of COVID-19 patients to dedicated COVID-19 units from hospitals, to improve capacity in local health systems.

“The environment continues to be challenging for operators as the world continues to struggle with the current public health pandemic,” White said. “The COVID-19 pandemic has impacted every operator within our portfolio in one way or another.”

Invesque is working with two of its tenants — senior living and care operators Symphony Care Network and Bridgemoor Transitional Care in Texas — on COVID-19-related relief and possible lease restructuring. Some of their properties have been significantly affected by the pandemic, White said, resulting in decreased occupancy and increased operating expenses. 

Invesque deferred 50% of Symphony’s rent in April and deferred 25% for May through August. The management team is in discussions with Symphony in light of the effect of the COVID-19 pandemic on its operations, White said, adding that Invesque intends to reach a solution that maximizes value for the company while placing the Symphony portfolio in a position to succeed during the pandemic and over the long term. 

Although the company said it is too early to comment on the restructuring, options include rent reduction, new operators at certain buildings and / or the sale of some properties.

Symphony accounts for 23% of Invesque’s portfolio operator exposure, according to an Invesque presentation posted online in conjunction with the earnings call. The organization offers assisted living, memory care, skilled nursing and rehabilitation.

Although Invesque’s skilled nursing facilities received Coronavirus Aid, Relief, and Economic Security (CARES) Act funding, its senior housing operators have not received any COVID-19 relief funding to date. Virginia and Pennsylvania, however, did announce they would be providing state funding relief for assisted living providers, although specific information is not yet available.

White said he hopes that industry trade association actions and lobbying efforts will produce relief funding in the coming months. He said Invesque’s senior housing operators have participated in Department of Health and Human Services-related data collection efforts to support this effort.

Overall, rent collections were at 99% for the company’s senior housing owner-occupied portfolio and 85% for its triple-net lease portfolio.

“While sentiment toward senior housing and skilled nursing will remain challenged in the short term, our regional secondary market focus with local sharpshooters has proven to be a sound strategy over the last few months,” White said.

Commonwealth Senior Living, Invesque’s subsidiary senior housing management and operating company, saw a 660 basis point improvement in net operating income on a quarter-over-quarter basis, despite a 220 basic point dip in occupancy in the second quarter. 

“In terms of census trends within the Commonwealth portfolio, we’re very encouraged by the positive sales trends over the last six weeks, with occupancy up by roughly 100 basis points since the end of the second quarter,” White said.

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