January rate increases for existing assisted living and memory care residents, as well as higher selling rates, were the primary factors behind the 4.2% year-over-year increase in revenue per occupied unit that Brookdale Senior Living saw in its senior housing portfolio, company representatives said in a May 10 earnings call.

The increase was 5.2% in independent living and 4.9% in assisted living, said Cindy Baier, chief financial officer for the country’s largest provider of senior living, based in Brentwood, TN. And it included rates at legacy Emeritus properties “for the first time in a long time,”  said Brookdale President and CEO Andy Smith.

“We raised rates relatively aggressively, but fairly, we believe, on our in-place residents,” Smith said. “And the good news about that was, those rates held, and we didn’t see any elevated move-out activity as a result of that.”

When it comes to move-ins, Smith said the company is trying to balance asking rates against what the market will bear. “That’s a local, street-corner, market-based decision that is applicable to every move-in,” he said. “We are not intentionally intending to drive rate higher and at the same time, as a consequence of that, sacrificing occupancy. That’s not our objective. What we are trying to do is to grow revenue, which requires a balance of those two functions.”

Improving revenue and occupancy are two of the company’s three areas of focus for 2016, Smith said. “While both rate and occupancy are important, we believe that it’s important to maximize revenue earned on the portfolio. That is revenue per available unit rather than maximizing either rate or occupancy in the isolation,” he said.

A new system that matches care charges to each resident’s acuity level ultimately will further optimize revenue per unit, Smith said.

Although Brookdale’s average occupancy in the first quarter saw a 70-basis-point sequential decrease and was “a bit softer than we expected,” according to Baier, the company has initiatives in place to improve in that area.

A third area of focus for the company is simplifying its business, Smith said.

Since the beginning of 2015, Brookdale has disposed of 24 committees, including seven communities in the first quarter of this year, and has ended six leases.

“Our criteria for dispositions include current performance of the assets, local market dynamics for the assets, including new competition, and the [capital expenditure] needs of those assets,” Smith said. “We also look at dispositions as a method of reducing the leverage, including lease leverage.”

Smith said that the company expects to sell at least 35 additional “noncore” communities this year. “We are also exploring the divestiture of leased assets with our [real estate investment trust] partners, including advanced discussions with HCP regarding the disposition of up to 25 noncore communities that we lease from them,” he said.

The market is strong and active for the type of assets that Brookdale is ridding itself of, Smith said, but by streamlining the business, the company will be able to “spend more time and effort on core assets in key markets.”