Ventas (NYSE: VTR) is optimistic about the future as it looks to expand its senior living portfolio through potential acquisitions after a successful quarter for its senior housing operating portfolio.
The strong supply-demand dynamics have driven occupancy gains higher for Ventas’ senior housing operating portfolio, which includes 570 properties based in Chicago. Move-ins have increased, resulting in a 240 basis point same-store average occupancy growth in the first quarter compared to the previous year.
Highlighted operators such as Sinceri Senior Living, Discovery Senior Living, and Sunrise Senior Living have shown exceptional performance, contributing to Ventas’ positive outlook for continued growth in the senior housing sector.
With investments totaling $350 million closed or under contract this year, Ventas is well-positioned for further acquisitions and transactions in the senior living market, taking advantage of favorable market conditions with high growth potential.
Analysts have noted Ventas’ solid core results and accelerating occupancy growth, with increased guidance for funds from operations (FFO). The company’s stock closed at $46.22, representing a 5.5% increase from the previous close.
‘Occupancy upside ahead’
In the first quarter of 2024, Ventas saw progress in its Senior Housing Operating Portfolio (SHOP), with a 15% growth in same-store cash NOI and improved average SHOP cash NOI margins to 25.6%. Executive Vice President of Senior Living Justin Hutchens expressed confidence in seeing further occupancy gains and operating leverage in the upcoming quarters.
Anticipating growth mainly from assisted living holdings in 2024 and independent living in 2025, Ventas aims to capitalize on the market opportunity for acquisitions that offer high yields and growth potential, expanding its senior housing portfolio.
