Leaders at Senior Housing Properties Trust, Sabra Health Care REIT and CVS Health Corp. spoke of challenges related to skilled nursing and opportunities in senior living Tuesday during their third-quarter earnings calls.
Senior Housing Properties Trust: Skilled nursing unit conversions may be in the future
Independent living communities in Senior Housing Properties Trust’s managed senior living portfolio saw occupancy up 185 basis points over 2017, President and COO Jennifer Francis said Tuesday on the real estate investment trust’s third-quarter earnings call. Room and board for residents was up 2.9%, she added.
Assisted living and memory care community occupancy and revenues were “slightly positive” compared with the third quarter of last year, Francis said.
“Alternatively, the skilled nursing units in our managed communities continue to struggle this quarter and offset a majority of the positive results from the independent living and assisted living operations,” she said.
Skilled nursing occupancy in the REIT’s managed continuing care retirement communities was down 90 basis points compared with the third quarter of 2017, and room and board was down 4.4%, Francis said. She noted, however, that skilled nursing units in the managed CCRCs account for less than 5% of the units in the portfolio.
“We have had success in the past converting skilled nursing units to other lines of business in our communities, and we’ll continue to assess the feasibility of maintaining skilled nursing as part of our property mix going forward,” Francis said.
REIT executives have discussed with Five Star Senior Living the possibility of their selling some skilled nursing facilities to other operators, the CEO said. “We think that would certainly help with their rent coverage,” she added.
CVS: ‘Opportunity is in assisted living, independent living markets’
CVS Health Corp.’s long-term care pharmacy business, Omnicare, merited a mention Tuesday during a third-quarter earnings call dominated by talk of the company’s upcoming merger with Aetna.
“We continue to see challenges in the skilled nursing facility space as the market continues to experience bed loss in these facilities,” said Eva C. Boratto, CVS Health Corp. executive vice president, controller and chief accounting officer. “Longer term, the opportunity is in the assisted and independent living markets. As we’ve discussed before, we have put our plan … for growth into action and will update you with progress as we get further along.”
Sabra terminates leases with Senior Care Centers; ‘I’m not happy about it,’ CEO says
See coverage of the Sabra Health Care REIT third-quarter earnings call from our sister media brand, McKnight’s Long-Term Care News.