Ventas Q3 2021 Earnings Call Transcript

Quartr
Provided by Quartr
November 4, 2021

There are 9 speakers on the call.

Operator

Good day and thank you for standing by. Welcome to the Ventas Third Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer Please be advised that today's conference is being recorded. I would now like to hand the conference over to your host today, Sarah Whitford.

Operator

Please go ahead.

Speaker 1

Thank you, Alisa. Good morning, and welcome to the Ventas Third Quarter Financial Results Conference Call. Earlier this morning, we issued Our 3rd quarter earnings release, supplemental and investor presentation. These materials are available on the Ventas website at ir.ventasreitdot As a reminder, remarks made today may include forward looking statements, including certain expectations related to COVID-nineteen and other matters. Forward looking statements are subject to risks and uncertainties, and a variety of factors may cause actual results to differ materially from those all of which are available on the Ventas website.

Speaker 1

Certain non GAAP financial measures will also be discussed on this call. For a reconciliation of these measures to the most

Speaker 2

Thanks, Sarah, and good morning to all of our shareholders and other participants, and welcome to the Ventas Third Quarter 2021 Earnings Call. I'm so happy to be hosting this call in person with my trusted colleagues for the first time since early 2020. Ventas delivered positive results in the 3rd quarter, sequential shop average occupancy growth benefited from its large medical office, life science and healthcare triple net businesses and executed on its investment priorities. Delivering $0.73 of normalized FFO per share, which is in the upper half Our same store shop portfolio increased rate and grew occupancy at record levels in Q3 Portfolio has increased occupancy 7.50 basis points since mid March 2021, lifting the entire same store SHOP portfolio nearly 600 basis points during the same period. I'm also encouraged that our year over year shop occupancy turned positive for the first time since the onset of the pandemic.

Speaker 2

So a robust senior housing recovery is well underway, but as we stated, it may not progress in a straight line. Resulting in labor cost pressures that accelerated in September. Looking ahead, we expect At a macro level, many economists forecast that labor force participation will expand from its current low rate for a variety of reasons. These factors should cause current conditions to ease considerably over time. Even more importantly, Doctor.

Speaker 2

Scott Gottlieb, who has been consistently the most accurate expert Throughout the pandemic, stated today that the COVID-nineteen pandemic is effectively behind us in the U. S. Given all the tools we now have to combat it, including Pfizer's new treatment, if Scott continues to be right, It is a momentous day for all of us. We continue to be delighted that 1 third of our business consists of Medical Office, Outpatient and Life Science, Research and Innovation. Our operational initiatives in medical office and Life Science R and I.

Speaker 2

Let me highlight a few new investments we've made. We've completed $2,500,000,000 in independent living investments, including our accretive acquisition of New Senior's 100 plus independent living communities at an attractive valuation well below replacement costs and a 6 community Canadian senior living portfolio with 1 of the new senior operators, Hawthorne. In medical office, we've completed or announced $300,000,000 of investments. 1st, establishing a new relationship with 3 Leader, Eating Recovery Center. We acquired a Class A asset under a long term lease in this rapidly growing 2nd, by acquiring our partner PMB's interest in the Sutter Van Ness Trophy MOB in Downtown San Francisco, We now own 100% of this asset at a 6% yield.

Speaker 2

With 92% of the MOB already leased, We intend to capture additional NOI growth and value. Finally, we intend to expand our relationship with Arden Healthcare by acquiring 18 of their 100 percent leased medical office buildings for $200,000,000 by year end. On On our 3rd capital allocation priority, we are delighted to announce that we have commenced development of a 1,000,000 square foot life science project anchored by Premier Research University, UC Davis, with our exclusive partner Wexford. Purpose built for clinical research, This project will be 60% pre leased to UC Davis and total project costs are expected to be $500,000,000 Turning to our robust investment pipeline, our team remains busy evaluating attractive opportunities. In fact, We've now reviewed more deal volume this year than we saw in all of 2019, over $40,000,000,000 These strong capital flows are also supporting our intention to recycle $1,000,000,000 of capital this year to enhance both our balance sheet and our portfolio.

Speaker 2

Our diversified business model continues to provide significant benefits. That together with demographic demand for our asset classes gives us confidence and optimism Our Our line and experienced team continues to be focused on capturing the double upside in senior housing from both pandemic recovery and the projected growth in the senior population and also to continuing our long track record of external growth. Justin?

Speaker 3

Thank you, Debbie. I'll start by saying it is very exciting to see the strong supply demand fundamentals Supporting occupancy growth in the senior housing sector. We have been busy taking actions through acquisitions, dispositions And transitions to ensure we are strongly positioned during this period of sector recovery. Our industry leading operators are Moving on to 3rd quarter performance. In CHOP, leading indicators continued to trend favorably during the quarter as leads and move ins each surpassed of occupancy growth inclusive of October.

Speaker 3

In the Q3, average occupancy grew by 2 30 basis points over the 2nd quarter, Led by the U. S. With growth of 290 basis points and 110 basis points in Canada, which is over 93% occupied. October leading indicators remained solid as leads and move ins continue to perform above pre pandemic levels and move outs remained relatively stable. Turning to shop operating results, same store revenue in the 3rd quarter increased sequentially by $13,600,000 or 3.1%, driven by strong occupancy growth and slight rate growth.

Speaker 3

Regarding rate growth, our operators have proposed rent increases to the residents of 8 In the U. S. And 4% in Canada, which on a blended basis is approximately 200 basis points higher Operating expenses increased sequentially by $16,700,000 or 5.4 percent of which approximately half is due to overtime and agency costs. Although we largely anticipated the additional labor costs, September spiked and represented approximately half of the sequential agency expense increase. We carried the elevated September costs forward in our Q4 guidance, which Bob will cover shortly.

Speaker 3

Despite the higher agency and overtime costs, our operators are now witnessing net positive hiring and are actively addressing labor challenges through a number of initiatives. These include centralized recruitment of line staff, Implementation of applicant tracking systems, delivering on the increased demand by employees for flexible schedules and other work place improvements to become more competitive. For the sequential same store pool, SHOP generated $106,700,000 of NOI in the 3rd quarter, which represents a sequential decrease of $3,700,000 or 3.4 percent. Moving on to portfolio actions. Our new senior acquisition closed on September 21.

Speaker 3

The portfolio consists of 103 independent living communities Located in attractive markets with favorable demand characteristics, integration efforts have gone extremely smoothly and we are on track To realize our expected synergies, we are pleased with the performance and operating trends of the portfolio. Its 3rd quarter spot occupancy grew 110 basis points Sequentially, the same store pool, which excludes the 33 communities that transitioned to new operators this year, grew 180 basis points in the 3rd quarter and then another 10 basis points in October, marking occupancy growth in 6 out of the past 7 months. We have also recently closed on an acquisition in Canada, which includes in Canada, which includes 5 independent living and 1 assisted living communities. These acquisitions expand our independent living exposure to 59% of We believe the structural benefits of the independent living model present attractive opportunities And accessible price points, all underpinned by exposure to a large and growing middle market. This is in combination with our existing portfolio positions Well to capture demographic demand with the 80 plus population expected to grow over 17% over the next 5 years while facing less new supply versus historical levels.

Speaker 3

I'd also like to note our previously announced transition of 90 assisted living and memory Care Communities is off to a solid start as 65 communities have already transitioned and the rest are planned by year end. We believe the enhanced oversight provided by the experienced mid market, midsize assisted living operators We'll improve the execution of local market strategy and with increased accountability. I have long standing relationships and familiarity with And I can say they are really fired up about their new portfolios. They are actively engaged with personal site visits to the communities and transition planning. Ventas has 37 operator relationships, including 7 of the top 10 largest operators in the sector and 8 new relationships added this year.

Speaker 3

We look forward to the opportunity to grow our relationships with these companies over time. In summary, the senior housing sector is benefiting from a strong macro supply demand backdrop. We are We are actively positioning ourselves for success through portfolio actions and our operators are driving revenue and managing the elevated labor situation. We look forward to forging ahead during a very exciting time of sector recovery. Bob?

Speaker 3

Thanks, Justin. I'll close out

Speaker 4

our prepared remarks by quickly touching on our Q3 office and enterprise results, discussing our recent balance sheet and capital activities and laying out our 4th quarter expectations. Our Life Science and MOB businesses led by Pete Bulgarelli and which represent Nearly 1 third of our company's NOI once again delivered robust and reliable growth in the 3rd quarter. These businesses taken together increased same store NOI by NOI grew 3.2% year over year and R and I increased 7.1%. Some stats of interest that underpin this strong performance. MOB occupancy is up 130 basis points year to date.

Speaker 4

Same store MOB occupancy of 91.3% is at its highest point since the first quarter of 2018. MOB tenant retention was 91% in the 3rd quarter and MOB new leasing increased 43% versus prior year. R and I occupancy remained outstanding at 94.4% and improved 50 basis points sequentially due to exciting demand for lab MOB expenses increased less than 1% year on year as a result of completed energy conservation projects and sourcing initiatives. And for the 2nd year in a row, we rank in the top quartile of our peer group for tenant satisfaction as measured by Kingsley Associates. 2021 rankings for each major key performance indicator increased when compared to 2020.

Speaker 4

At the enterprise level, we delivered $0.73 of FFO per share in the 3rd quarter. This result is at the higher end of our $0.70 to $0.74 guidance range and benefited from the stable performance of our diversified portfolio as well as a $0.04 ardent bond prepayment fee that was included in our guidance. We're also very active in the 3rd quarter managing our balance sheet and capital structure. Consistent with our prior $1,000,000,000 disposition guidance, we now have $875,000,000 of disposition proceeds in the bank with $170,000,000 of senior housing and MOB portfolios under contract and expected to close in the Q4. These dispositions have enhanced and reshaped our portfolio, and we've used these proceeds to reduce 1,100,000,000 near term debt so far this year.

Speaker 4

We also issued $1,400,000,000 of equity in the 3rd quarter, including $800,000,000 for New Senior and $600,000,000 in ATM issuance at $58 a share. As a result, our net debt to EBITDA ratio excluding New Senior improved sequentially to 6 point 9 times, while including New Senior, Q3 leverage was better than forecast at 7.2 times. As an administrative side note, We plan to enter into a new ATM program replacing our 2018 program, which is nearly complete. Turning to Q4 guidance. We expect 4th quarter net income will range from $0.01 to $0.05 per fully diluted share.

Speaker 4

Q4 normalized FFO is expected to range from $0.67 to $0.71 per share. The Q4 FFO midpoint of $0.69 Can be bridged from Q3 of $0.73 by $0.01 net impact of tenant fees, The impact of capital recycling for debt reduction and prefunding of new investments is $0.02 and various items round up to explain the last penny. Our SHOP portfolio NOI is estimated to be flat sequentially. Key 4th quarter assumptions underlying our guidance are as follows: Starting with our shop same store expectations. Shop Q4 average occupancy is forecast to increase between 80 and SaaD occupancy, September 30 to December 31 is expected to be approximately flat.

Speaker 4

The resulting sequential shop revenue growth Just grants are assumed to be received in the 4th quarter, though our licensed assisted living communities have applied for qualified grants under Phase 4 of the Provider Relief Fund for COVID losses incurred at the communities. Outside of SHOP, continued stable performance is expected in the Office and Triple Net segments. We expect to receive an M and A fee in Q4 of $0.03 for the announced Kindred sale, which Kindred communicated At a blended yield in the high fives and our fully diluted share count is now 403,000,000 shares reflecting the equity raised to date. I'd like to underscore that we are still in a highly uncertain environment and the pandemic's impact on our business remains very difficult to predict. To close, my colleagues and I are excited for the future of Ventas, given the expected robust recovery in senior housing and the external growth opportunities both under our belt And that lie ahead.

Speaker 4

That concludes our prepared remarks. With that, I will turn the call back to the operator.

Operator

Your first question comes from the line of Michael Carroll, RBC Capital Markets.

Speaker 5

Yes, thanks. Debbie, I want to talk a little bit about the investment market. I guess with the delta wave and the labor pressures, have you seen an uptick in the number of investment Particularly in seniors housing, I mean, should we continue to see that activity from year end persist over the next several months quarters?

Speaker 2

Good morning, Mike. I mean, as I mentioned, we have just seen a tremendous volume across the board all year long, More than we've ever seen, and we do expect that to continue.

Operator

Your next question comes from the line of Nicholas Joseph of Citi.

Speaker 5

Thanks. I appreciate all the comments on Expenses and rate and occupancy, but just as you step back and think about kind of margin once we get through some of these transitory issues, how do you think margin

Speaker 2

Thank you. Justin?

Speaker 3

Sure. Hi, Nick. So just stepping back and thinking about the ultimate drivers of margin, You've probably heard us describe a train before. The front of the train really is leads, leads come first, that drives move ins. Net move in activity drives occupancy, pricing certainly supports revenue growth as well, and then there's expense management.

Speaker 3

And over time, we certainly expect that there'll be margin expansion for two reasons. One is that the supply demand Characteristics that we're facing do support occupancy growth and should present opportunity for pricing power. Clearly, in the near term, there's expense pressure to the labor that we mentioned, but the macro backdrop does seem to be improving. And as I mentioned, our operators are taking

Operator

Your next question comes from the line of Rich Anderson of SMBC.

Speaker 6

Hey, good morning. I have a kind of a question about Vaccine mandates and at the property level and how that's being managed. And I'm curious, I don't know if I remember what that number is for Ventas and if you could share that. I'm sure it's someplace. I'm just not remembering it right now.

Speaker 6

But who makes the call on that? I assume in the SHOP's execution that Ventas has at least a say in that, maybe I'm wrong. And I'm just curious Your thesis is or your ideas are around vaccine mandates at the property level now and perhaps Taking into account the Pfizer news and what you're thinking about it going forward? Thanks.

Speaker 2

Hi, Rich. I'll start and then turn it to Justin. Our operators have by and large been early adopters of vaccine mandates within the communities to keep the residents And we're at very, very high levels now, nearly 100% of both resident and We've been way ahead of the federal requirements for vaccines because we are caring for vulnerable seniors And also had access early on from the vaccine rollout, both employees and residents. And so That has been both a moral and a business imperative. It's worked really well.

Speaker 2

Our operators have led on it and they have made the

Operator

Your next question comes from the line of Nick Veliko of Scotiabank.

Speaker 7

Thanks. Good morning. So I was hoping you could just I don't think you break out labor And the change there, if you could just give us a feel for how much they did increase quarter over quarter year over year? And Just how we should think about the trend of labor expenses next year because I know there's some optimism that you think that It's going to get a little bit better, but I'm still just not entirely clear why use of contract labor and other items would Go down in this type of job market.

Speaker 2

Bob can address The quantitative parts of your question, I think from a high level, again, the timing is unknown, the extent is unknown, but there are multiple factors at a macro level that will support increased labor and workforce participation. And those include children back in school, children vaccinated, the expiration of public Policy such as the federal stipend on unemployment and also just People's savings running out as a result of that and schools being open and the like. And so All of those factors really play into the macro thinking around easing of current Labor conditions, I think, again, if you just step back, what's great about this recovery is that demand has sprung back, not just in our business, but broadly Speaking, it has surged and the supply chain and the labor force are still adapting and adjusting and haven't caught up yet. And over time, those things will get more in balance. And that's kind of what the economists forecast and that's why those are the factors So Bob, do you want to talk about the specifics?

Speaker 4

Sure. And Nick, Page 12 of the business update that we issued this morning could be helpful because it lays out the operating expense We saw sequentially between the 2nd and third quarter, which is roughly $17,000,000 And within that, labor representing, call it, half of that increase. And If you further double clicked on the labor piece, call it 2 thirds of that would be contract labor. I'd Reinforce the fact in our guidance for the 4th, we saw this acceleration in contract labor in September. We effectively assume that to continue through the Q4 in light of the backdrop.

Speaker 4

Important to note that contract labor is at least 2 times as expensive In house labor and so these initiatives that Justin laid out to increase staffing reduce that contract labor and have a positive

Speaker 5

Your next question comes from

Operator

the line of Rich Hill of Morgan Stanley.

Speaker 5

Hey, good morning, guys. Thanks for having me on the call. It's good to be a first time caller, long term listener. I did want to talk through and maybe hear a little bit more about your operator contracts. 1 of your peers have talked about maybe half I'm wondering if you see something similar and maybe you can unpack that for us.

Speaker 2

Good and welcome. Yes, this is addressed also in our business update. Justin, do you want to take that?

Speaker 3

Sure. Yes, if you Look at Page 14 in the business update, you'll see this. And first of all, the headline is that Our operators have proposed to our residents an 8% increase in rent in the U. S. And 4% in Canada.

Speaker 3

If you look to the left, you'll see how this breaks down and that 55% of our residents are eligible for increases in the Q1, 35% Get an anniversary rent increase, and so those will happen throughout the rest of the year. And then those that moved into late in 'twenty one, obviously, Wouldn't be eligible for an increase yet. So there's a huge opportunity to grow revenue. This is a consistent process, Tried and true. It's just that we're going to pass along more rent increases this year.

Speaker 3

And I'll just add that our operators are very careful about and taking local market considerations into their planning so that they're in line with market And I could successfully execute. And then there's also level of care, which is really acuity driven, And that can increase throughout the year as well, both in terms of how much we charge, but also the acuity level of the resident would drive

Operator

Your next question comes from the line of Derek Johnston with Deutsche Bank.

Speaker 7

Hi, everyone. Good morning. Can we go into some detail on the shop transitions to the more experienced local operators in Various markets, but really specifically how that may have impacted these transitions, the 4Q guide, But at the same time, how the transitions could benefit 1Q in 2022? Thanks.

Speaker 2

Thank you. Yes, I'm going to turn that to Bob and Justin to talk about the transitions, which As Justin said, we are well underway.

Speaker 3

Okay. Thank you. And I'll start with really just some of the rationale for why we did it and why we think this is going Helpful to performance. And you'll notice on Page 13 on the right hand side that we highlight this. We selected operators that have experience.

Speaker 3

They have experience within these markets and they have experience running regional markets. And one thing I've been very encouraged about Is that the CEOs of these companies have been actively engaged in the transitions. We have a cooperative transition with the former manager. So we've actually been able to get on the ground Into the communities, start assessing, getting to know people and be ready to try to get off to a strong start when the transition begins. And you have the advantage when you have a midsized company with a regional presence is that you have senior management that is very close to the community.

Speaker 3

So we do expect the oversight to be very strong. And then these companies Excited to grow and there's just an energy to it that's really positive and it's well assessed and we look forward to positive results. Having said that, we would expect to have some transition noise in the early going that was factored into

Speaker 4

the 4th quarter. And I'll hand over to Bob. Yes. That's really again back to the labor theme. Frankly, this normal noise is increases in the labor costs in the 4th for this portfolio.

Speaker 4

So that's embedded in the guidance for overall SHOP being flat.

Operator

Your next question comes from the line of Juan Sanbria of BMO Capital Markets.

Speaker 5

Hi, good morning. Just a question for Justin on asset management. You seem to be making the transition to more smaller regional operators, which makes sense. But just curious on A couple of fronts on the data analytics front, what you guys are doing and maybe some hires you've made there and the efforts that are being put forth? And then secondly, just as we look forward, should we expect more dispositions heading into 'twenty two, given some of the stuff that was on the market Didn't transact and you haven't necessarily sold a ton of assets and the leverage is still a bit high.

Speaker 5

So just curious On go forward dispositions, kind of thinking about 'twenty two and any cleanup that you guys want to do for the portfolio kind of as we exit COVID?

Speaker 3

Hi, Juan. It's Justin. I'll start and then Bob will jump in as well. Let me start with the data analytics. We have made new hires.

Speaker 3

We've become much deeper on what was already a strength in terms of market analytics. We certainly study supply and demand in great detail and have Really good familiarity with local markets, and which has helped to inform some of the decisions we've made, But also it will help to inform growth decisions we make moving forward. Great team. We've also enhanced our operational Analysis through hiring people that have experience in operating companies, and have high analytical strategic experience So that's given us insights into the business that are extremely valuable and inform Our decisions, but also help to inform the decisions that the operators make in their planning as well.

Speaker 4

I'll take the disposition Question 1, the short answer is no. We don't, as we think about 2022, expect significant dispositions in senior housing. We do have

Operator

Your next question comes from the line of Steven Valiquette of Barclays.

Speaker 8

Hi. This is Eric Glynn on for Steve. I guess as the labor pressure How do you think this affects long term productivity? I know one of your peers had mentioned that it would take several quarters to reach the same level of Historical productivity due to the time that it takes to ramp new staff up to speed and deal with onboarding. I was just curious if this is affecting you at all or is the actual staff turnover not really high enough to have an impact here?

Speaker 8

Thanks.

Speaker 2

Yes. I would just say simply that that is a part of the labor pressure and the timing of when we would expect conditions to ease. Certainly, the industry is experienced at onboarding new workers and that's it's an industry where there is Shifting of on-site workers and so that is the strength of the industry, but it will take Some time for these conditions to abate, again, for a variety of factors, including kind of getting up to speed and training. So that is correct.

Operator

Your next question comes from the line of Jordan Sadler, KeyBanc Capital Markets.

Speaker 5

Hi, there. I just wanted to circle back on the ESL transition assets And maybe I think in the press release last month, you talked about no contribution of NOI in the 2nd quarter. So I'm curious what the progression was sequentially. I know we have the same store numbers, but I'm curious what The ESL portfolio did sequentially. And then I'm curious, what the outlook Would be because I would think that an operator would the operator transitions historically have caused some disruption.

Speaker 5

So What sort of the outlook would be in terms of looking at the curve of a recovery and the cash flows up for that portfolio? When we should

Speaker 4

Yes. Jordan, I'll take that. I wish I could draw this picture in front of you because I do think you'll see some as we saw 2nd quarter into 3rd quarter, some erosion in NOI in And as I mentioned, we're expecting that to continue into the 4th given the labor cost pressures and just the normal noise associated with the transitions. The strategy which Justin was speaking to though is once these are in the hands of these new operators, they will employ their skill to Really drives that performance of that portfolio in 2022 and beyond. So that's the goal, And we're right in the middle of that right now.

Operator

Your next question comes from the line of Mike Mueller with JPMorgan.

Speaker 5

Yes, hi. Wondering how much of the higher labor expense pace do you think is attributable to Recent rate pressures for existing staff that may be a little bit more sticky versus

Speaker 4

the idea of just having

Speaker 5

to utilize more higher cost contract labor.

Speaker 2

Yes, good question. Justin, do you want to comment on that?

Speaker 3

Sure. It's really more around just the availability of staff, the availability To staff fully with your existing people, one thing, there's kind of a series of The steps that operators take, the first thing they do is they try to make sure that they're utilizing all the full time hours available for their existing staff. Most operators don't schedule the 40 hour weeks, and so there's always room to expand a little bit, so they'll do that first. Next step is they'll use overtime, so you have your continuity of your And one Interesting tidbit around this is that there's not really a certain MSA where we're seeing agency use. It's clearly a macro But within MSAs, there are certain communities that really have an outsized amount of agency that's being utilized, which Points to the opportunity for an operational solution.

Speaker 3

So we have plenty of evidence that this can be managed. And as I said in the prepared remarks, We're already starting to see hiring picking up across the operators.

Operator

Your next question comes from the line of Josh Dennerlein of Bank of America. Josh, your line is open.

Speaker 7

Sorry. Sorry, Jared. I was on mute there. I was looking at the RevPAR growth for the Same store pool. Just kind of curious if you have any kind of expectations as we go forward when it might Turning to positive growth on a year over year basis.

Speaker 2

I mean, the trends have been encouraging. And Justin, do you want to comment Specifically?

Speaker 3

Sure. Yes. So there's a few moving parts in RevPAR. One is mix, which is really just

Speaker 4

The

Speaker 3

contribution of RevPOR from certain product types and We are benefiting this year. I've mentioned this before that we would benefit from the U. S. Recovery because we'll see our higher price point product, particularly in Sunrise, for instance, That's a driver of RevPAR overall, so we're getting some mix shift benefit. Probably more importantly though is we're getting the benefit Better re leasing spreads, and that's been consistent.

Speaker 3

We saw the underlying trends in the Q2. We saw it through the Q3. And when we get into next Obviously, we have the in house rent increases that we mentioned, but the pricing power should continue to improve because what starts to happen is you're covering move ins that occur 2020 that came in at a relatively low rate. As the momentum picks up in the sector, Our operators are able to charge more and so we're looking forward to a period of really improved pricing in Rev 4 moving ahead.

Operator

Your next question comes from the line of Michael Carroll, RBC Capital Markets.

Speaker 5

Yes. And they're not existing seniors housing residents generally don't like to move away from the communities that they're in. There has been a small percentage that did elect to do that pre has that trend come back post COVID or are residents Still hesitant to move in because of the pandemic move out, sorry.

Speaker 2

Could you repeat that, Mike, and welcome back. You got a short question the first

Operator

Please proceed with your question.

Speaker 5

Yes. So I know residents generally don't like to move out from their facilities on the seniors housing residents, but there was a small percentage pre COVID that was willing to do that. Has that trend come back at all or are residents still hesitant to move out because of the pandemic?

Speaker 3

Hi, it's Justin. So there was actually since we've been in this period of recovery, there was one month, I want to say it was April, where you did see a little bit more move out And we did really correlate that to people being able to make a move where they weren't moving during the pandemic and they had an opportunity to move around in the month of April. We also know those that move in activity is picking up. And so I think there is you're just kind of trading seats with other operators. And so there's a lot of movement then.

Speaker 3

But Since then, it's been very stable, very consistent in terms of move out activity.

Speaker 2

I do. As I said, we have a lot of optimism and confidence. It just happened to be a momentous day with The advent of additional COVID treatments and a real line of sight to this pandemic possibly being over. Our business is doing really well. It is diversified and benefiting from the internal and external growth We have a great set of partners and a great team here at Ventas.

Speaker 2

We are very appreciative as always of your interest and your support

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Ventas Q3 2021
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