Sabra Health Care REIT (SBRA) 4 May 232023 Q1 Earnings call transcript

Good day, everyone. My name is Lisa, and I will be your conference operator today. At this time, I would like to welcome everyone to the Sabra Health Care REIT First Quarter 2023 Earnings Call. [Operator Instructions]

I would now like to turn the call over to Lukas Hartwich, SVP, Finance. Mr. ahead, go Please Hartwich.

good and morning. you, Thank

risks concerning I to comments Before should results we results our later to we in not are of differ as make remind our events forward-looking no expectations questions that to operations, current materially, in yesterday. including furnished to to management's as exhibited actual XX-K be and we to statements undertake including response could financial making and the December your and included begin, will as subsequent comments expectations release are forward-looking the assume for subject you still our regarding and ended the tenants you and want statements well our XX, the XX.X SEC position that press expectations or our XXXX, we to future We listed year acquisition, and uncertainties quarter our cause update to our circumstances, on X-K today regarding Form valid. Form regarding are investment and earnings based our risks the that our disposition plans. These in obligation operators expectations in forward-looking our statements reflect and the in

as of In results well the our of GAAP are the be non-GAAP the comparable explanation encouraged these section addition, to reconciliation to financial made on sabrahealth.com. Investors the as references and website will financial Financials to non-GAAP Investors results. during call this measures, review measures included these at page of

call to Health of our section and President me accessed release Rick in Our let Matros, also Sabra Investors over can CEO, the that, with earnings be REIT. Form XX-Q, turn website. And Care of and supplement Chair the

month in our January day, good every portfolio in recovery. skilled Occupancy has the improved traction XXX continued through October skilled operational everybody. us. through fourth in basis and Occupancy see January. now and Lukas, nursing Thanks improved portfolio in points. quarter continuing our joining to We're for Thanks, nursing

well. slog Labor tough, going in for there, skilled dramatically Our off a jumped certainly highs improving, inflationary still terms up to we're utilization. mix are it's bit increases of trends first quarter and but be of our a I think, but as while, a it's in agency the and

trailing feel sequentially we the want made and be good there we to think couple well. EBITDARM the even this being I way comment and about without operators. on on as that's XX-month So trailing PRF, looking that's basis. progress a specific basis at a has more X-months at only improved on should a point, everyone it coverage really so of

was tough them. noted that XX I right-sized their distracting think so had half. a decline. facilities, Signature leaner corporate a accommodate sold company, Health everybody saw and closed and X second coverage to Health and Signature infrastructure for They quite

first quarter wasn't and as However, first went quarter rebounded the and a to their back Health X.X quarter that was I strong for Signature over dramatically, is one. find years find able to as

reported, had call, lot of going That's their a it's to still a of there. is good they for on on Comment while old and there's well they're was Ensign. as well. also from though basis. Similarly, Avamere, coverage really Ensign American we well So as where for even a noted feel their going quarter Health fine transition on about North first Avamere, the had schedule, strong SIG the earnings upside portfolio. current be quickly ahead

basket, proposed like next a with and we several of some terms SIG Most historical we're on with X.X% have July be. in more portfolio our and over what we pleased for and on Health rates right be now. We're of will than better place do expect feel X. weeks good rate operators, the those those Ensign, increases We'll of increases. all So X effective Medicaid clarity will rate really largest probably in those X the our market Avamere operators

some Our of data, certain report that's the expectation, many reflect the in of the will rate extending year on that the of and more some though, update base states. reflection will and impact is COVID of be to fact a do the add-ons, industry states current COVID that of lack states the Medicaid acknowledge cost some rate increases and viability

noted So more I'm seeing same rates. Investment has changed that about who obviously is little On others, in bit out Enlivant, needs will press any and sure rating release, than summer driving so at the Pricing that the JV, loans will position we're agencies Talya the remain no earnings gone. have we their a -- carried some terminated debt Medicaid with there, the company things saw in of There being as folks states JV. last activity is uncertainty light generous that Competitive the number still there as lender impact summer, as and other this we liquidity talk of so are is and by fact to other more as the our well. or sales. look the landscape with ramifications in the and near-term. are and exists, on a

AL to a The new are Talya. care afterwards, I the will of that to the us. We're The XX larger call portfolio. came in on and primarily are turn I over facilities those portfolio are XX was XX the a own the original So JV for facilities, focused than or acquisition. at the operator. looked we larger JV memory that different that, transitioning combination event note markets would patients JV now it's with the from de-levering perspective, on that part that wholly-owned facilities facilities and residents. And wholly-owned for these ALC debt, they a of

of update health. you, then and brief activity our first our Thank a to results managed investment housing I'll in senior the Rick. provide turn on portfolio behavioral

overcome challenges Having for for residents flat essentially most quarter is the labor but XXXX. bringing managed was Our foundational. years, is its recovery operators first and wholly-owned not wage senior continuing X on building investment positive, of focused in that it of portfolio who, seen continued now and evolution residents manage an nearly by are to now housing strategies by XXXX, occupancy throughout exceed as in new a which are materially continued are the in moderate, acquisition customer and choice. Expenses to the in departing part, numbers leaving worked

XXXX, embraced by excluding assets to to and numbers The operators became this pivot managed quarter, the the they for wholly-owned than change. the NOI in government funds, off the they quarter and driven margin and headline stimulus wholly-owned our demonstrating our of basis, a $X,XXX increases follows. were the are stimulus, this to quarter. portfolio wholly attuned Our non-stabilized sales, over prior first than quarter a challenges pandemic holiday began, to when virtual over living have quarter same-store a and and ] by owned prior forced Enlivant point on decrease of in as XXXX and Enlivant in in the our cash slightly of government increase in prior of particularly nearly portfolio, basis higher XXXX, living environment by $X,XXX the continued portfolio, was [ portfolio. rate XXX X.X% quarter. REVPOR basis XXX XX% the the recovery, but quarter, operating first XX.X%, flat achieved XXXX, portfolio, quarter quarter for of quarter annual prior was Including first the government leverage. benefit XXXX for for nearly the Occupancy XX% in XXX excluding point first quarter basis first higher first and -- driven the independent the was first REVPOR increased of our assisted points over

occupancy gains We continue to seasonal see across continued and portfolio. our strong housing senior rate growth

Our in net of increases housing seen stabilized the XXXX. since has February leased consistent senior portfolio occupancy low

the is level and XX.X%, immediately the had XX.X before the ]. recovered points pandemic As to [ XXXX, of occupancy February equal of percentage occupancy level above to which pandemic

had assisted leased care, and independent more occupancy as skews Our than needs-based. recovery have are to living, portfolio they robust a memory living which

addition, length at seem have managed an higher in relative us some be participate communities In recovery. Move-out death, portfolio, to speculate the move-outs rates, phenomenon, higher now, of rate a early vaccine in pre-pandemic needs performing to average what in rounds financial seeing averages. and COVID we transitioned of reverting mostly later. driving stay spiking pre-pandemic We This first after are temporary then to poor driven be residents care elevated their XX the communities, allowing during may at moved levels by are we clinics that XXXX. that demand, as stabilizing, but characterize months we leased to to pent-up as

critical cost-effective have acquisition scale of customer mentioned calls, become who have operators a filling are leases. strategies benefit marketing high-yielding, conversion leads to rate of have As generate communities. to digital to successfully qualified using the and Larger time-efficient, capital prior that high and in

those the higher, through is sources. the digital are rate other from operators' from of far presence sources referral personal move-ins Although, number exceeds that sourced conversion lead absolute

acquisition phenomenon of quarter's to first quarter. of U.S. described and in We portfolio U.S. are we excluding evolves. Comparing see The in by Canada the customer see target prior also for further our same that resolving. XXXX slightly gains, in last occupancy evolution in as our of be the move-out reason. stimulus, communities the still outperformed of labor country, in senior have see compared Canadian we government seems call we availability higher early cost housing likely of a expect we offsetting also the results stages rates the that as wholly-owned quarter managed customer the changes our to In similar the with assets Canada, noted earnings

XXXX, reduced by the to first in example, an As quarter compared venture XX% joint agency quarter. Canadian costs the prior our of

health mortgages portfolio. end first of of Sabra's at to behavioral $XXX million investment total million Turning a of At which once $XXX total balance investment properties the the first briefly end committed is XX deployed. X the and behavioral our the capital health of to quarter, in the included expected with is quarter,

I Financial Sabra's portfolio, properties for over owned in additional We identified potential regarding will within our Officer. with operators conversion locations. And those active that, Costa, are the call have and to discussions candidates Chief with Michael turn as

Thanks, Talya.

we AFFO share results expectations. FFO our quarter articulated our line with the are recognized normalized first on quarter normalized These $X.XX with per consistent of normalized share rates of are normalized FFO in the we per AFFO and $X.XX. call of For run and XXXX, earnings and fourth

as annualized our which XX.X% March annualized previous the of Also, points XXXX, with X% and X As of XXXX year NOI XXX million, coverage, XX, cash SNF NOI, represented points was from March basis of XXX from XXXX, of exposure below down was quarter quarters. cash XX, approximately of our consistent Xx NOI our basis down EBITDARM and fourth is $XXX.X our ago.

million $XX.X a through and quarter any housing portfolio the We earnings quarter future expect in recovery $XX.X throughout managed million, dispositions. G&A compared totaled continue lower to senior for of result further as SNF percentage in the moving to XXXX this costs fourth XXXX. of our

stock-based $X.X quarter expense, G&A quarter compensation $X.X the cash compared million, was of the XXXX. for fourth Excluding for to million

Now turning to sheet. the balance

be Our Sabra, market balance tightening high the of to sheet interest us for withstand strength allowing confidently to credit a continues rates. and headwinds source of

debt XX, credit facility. nearly of March equivalents liquidity ample million all XXXX, $XXX with $X of $XX and unrestricted billion, As are of borrowings covenants million of cash under and cash have in of and of we revolving compliance available our consisting our

no near-term maturities. have We material debt

material Our currently and is weighted is average XXXX, debt years. debt next X.X at maturity our maturity in

Our in line our debt-to-adjusted XX, as and X.XXx of EBITDA net expectations. XXXX, ratio March was with

decrease in and proceeds through continues operational from our our as any recovery leverage periods its to portfolio future activity. expect disposition We future

and normalized debt, up share makes maturities the rate markets as our we XXXX. in XXXX. just to of a affords of balance XX, will dividend quarterly of Directors low XXXX, May our leverage common on dividend exposure, of The the Excluding fixed X.X% permanent of future. On on of represents XX, X.XX% luxury a a which of close our have sheet our not debt as total is of share. dividend no of per no of stock. X, debt with cash our of and The floating of May XX, March business revolving combination cost facility, be access near-term liquidity capital rate the us per a meaningful credit XXXX, the record, common AFFO payout paid to XX% Board declared foreseeable The $X.XX stockholders May as needing

earnings then, $X.XX still to XXXX. sometime issue we but our fourth quarterly run and we not $X.XX to hopeful the in Until so share that did the quarter, that position do is rate still we we FFO will are this be to Q&A. per share normalized we that per line in Lastly, believe open on guidance call AFFO up for with that, normalized provided of quarter appropriate. And

Griffin Michael Citi. the with [Operator comes first Instructions] line Your from question of

were Maybe and we rest mean, of can might high of expectations the end that the about to let's you're something, of the of the year, around where flat assumptions kind thinking year, at thinking I'm beginning decreasing. year? But how are agency around if you of that, -- go kind be or costs your your curious, back the of maybe labor to we SNFs. changed? And the And has agency it at quantify you I say, Rick, fundamentals a for thoughts the utilization level gave in

So, no, around my haven't thoughts it. changed

X% We'd quarter, I to -- obviously, their by think we And to it's in still Signature think XX see XX in costs. a improvement is drop issues. had occupancy, a more, of first so doable. hampered like but But still for Health, the doable. sequentially think seen point we've that, example, basis labor labor we month that's

I to improving Their it's was nice drop XXX suggest don't that up occupancy relatively that to was sequential rate, So portfolio. dramatically that in points -- with occupancy in going quarters. want but almost at a and that continue pretty basis

going I sort just of think to So, be a of still kind slow improvement. it's

greater a the the well, to also the but staff greater I would -- agency last of rate inflation increased as be good shift think there'll on those that to needs basket. wage expect continuing more really there shift wages, has And especially because nothing of think in-house from wages staff with I on down. this but increases in terms facilities. To year, second and be passed summer half continue slowed front, year, that extent the in the market both were were the news reimbursement significant there's that, the of Medicaid to on Medicare that of there to I

to hire obviously, well. but with to this and cash it's as going to help use that's for help more So going also people margins, to set staff provide

clarification one on the just then And coverage.

X.XX way ex we is said to If of quarter 'XX, December this probably X.XX than on PRF, the about back go would I your be deck, the which last thinking basis? a think year-over-year quarter, like be improvement about in lower you this it, think you versus have was right about to It we out laid number that or should quarter. it X.XX

we'd and we If that it one call, quarter fingertips. that to have on We basis, still at I go we'll because know. that let my have don't dig we're to up, everybody a the higher certainly, But back have it's at while look year-over-year find specifically. on but can

next Our Credit question Okusanya Tayo comes with from Suisse.

X questions for me.

lease that EBITDA First Again, of EBITDA all, of side, believe. senior coverage I housing suggests of is on less kind probably the still X. X.XX, than

possibly So what's over fundamentally just about think there suggests assistance we kind tenants coverage improves Is that going of some portfolio? ultimately wondering, risk how that of happening of within kind some that Again, pool needing do time? forward?

give can I there. color Tayo, you some

of [ a really So, X would ]. a first right? XX kind trailing It's it's quarter all, of of stale -- year-over-year first all, number,

still that the and and going as agency that in costs seen that's you expecting number, issues into We've even quarter. my labor -- in roll and in know of mentioned impact also that have off. increases, this past occupancy even kind that this we're into we coming I the to So remarks, portfolio, of

the EBITDARM So number, part number, to that are turn, is -- are roll expense embedded of especially we're as the start the and optimistic to that to labor in coverage in that issues once going off. going

much just Tayo, not in the non-labor our inflation all me add, category. We're in our classes. Almost let labor all -- category. asset also of the in is We inflation is worth of what seeing

and inflationary on about levers. we're other retaining bit as that operators not that staff of So get a actually sort better recruiting worried the quite helps

the at have economic you entails I just up? just gave from us, this from this then away kind mean, benefit no impact, you it or of help this mean a just kind that guys get give kind economic your you to and thing, for able If exactly didn't up Does what withdrawn could going to entails? Enlivant of giving of be withdrawal exactly like, you fair? you from you details no of ownership walk JV And interest, in free, kind But understand any just perspective, nothing all the from forward. us clean what of

-- that There's agreement to documents JV JV walk. a either and in give rather provision side a the just allows notice

It's a compensation. that, no like like not term to fee there's So or -- anything agreement management something has like or one that. side claim where a a fee

transitioning have assets. walk. there to anyway. lenders of sort just They're other You There's the operators. the And just look, there's -- assets nothing

-- anyhow, obligation Those so no was non-recourse loans to are Sabra. recourse there

all debt for unfortunately, buyers markets away the took obvious really Yes, the in downturn potential portfolio. the the Tayo,

of business, whole down, debt markets whammy of potential the and double you out of wiped audience a so turned then and you the the So on of had pandemic sort buyers. impact sort the

our next Josh question with Dennerlein America. take We'll from of Bank

I just I and benefit Yes. was income you JV. flowing portfolio, wanted there your from that but I get debt you statement. a away the now Is walk a Enlivant because on on be to would have get follow-up thought assumption that wouldn't correct would it, can through or…? that the

Yes, assumption. so it's a not correct

Here's why.

X. but accounting down going the any the we longer Not AFFO any under did method, any recognize we FFO, accounted forward that So that X. joint Period. we from any venture much zero work, way of you that to was because thing before joint equity it rules venture. It's was expenses, it's quarter, that revenues, last and no for that, when as recall, the wrote

anyways. that was joint sheet not joint a it it financials result unconsolidated our venture, an our as venture. our of on X. was it balance writing financials since through appearing flowing The nothing of debt, exiting flowing through as So result there's down There's to nothing a us our

to this. as of literally, result financial our no a impact So statements there's

was So in on nothing the go results, forward? the was XQ and impact already there the

everything, There was X. was value for There's that in in our FFO, XQ X There balance the nothing X Enlivant earnings, X venture. sheet, nothing results. results joint X quarter first

come are better remarks, And in to kind better be hearing that that are the to of then, boosts confidence of gives side. your you or seeing increases side? on kind on Rick, the the expect guess, you you Medicaid mentioned opening in what I going you

the are the actual folks the it's associations legislatures with Well, the charge trade in in of and that's the that and there. states dialogue state happening the various budgets

So from. Last be we states. that year, when not we it's where XX Look, coming more out had that's going published giving states on rate that. to we're all really increases, it's clarity those size

I was second quarter our think earnings that 'XX release.

we'll So, the the states later on coming think do from than that But mark sooner -- if is update biggest know that a on we're in the that do discussions. business as well. And question same. We'll I we it's direct Texas.

the -- of think we But with effect in goes everybody's full to above amount additional legislature the option Texas part some in the that that case, now don't that September. I XXXX and until this into XX, comfort just So permanent issue extending has they're will that. The do going PHE level XXXX the May was away that. the increase rate yet a states got going make of FMAP if Texas add-on is know

kind but scenario have they're where a in September, for the lose you think FMAP I there add-on. where that they X-month going isn't They'll X-month period to worst it of case back get hole Texas So have is anything.

all put states, other again, what our are dialogues like and being based on and we that. about things assumptions budgets stuff Texas. But, know the on in that's actual So

some of out, other The too, this is should I point organic. just is thing

summer's better, Medicaid expect during we that so worst had starts report the inflation. It's when reasons cost capturing when of do really -- because XXXX, reports summer's actually the even between inflation they'll of increases are to COVID. be cost to reports lot occur. inflation. one rate itself a that those the and capture state process But of next reimbursement next cost we capture period rates the time be There's a So filed lag

year the fact that that base the particular states. may are now of a be positive accelerate states So the period those and is couple for not cost for a to wait report another there willing

Austin And from our we'll with next take Capital question Wurschmidt Markets. KeyBanc

$X.XX upon and sort generating of How year, housing question on to with When much XX ultimately range NOI you commenced any assets the $X run a assume senior portfolio? is transition layer in from captured managed were the And the in think basis highlighted $XX an they $X million last to on cash that that rate? rent of also, then have I annualized run the upwards you I million rate. million that in around of $X.XX the commencing. guys acceleration $X.XX to has does $X.XX

right, on reported So we the or reported this run what based on what quarter, even we QX. rate is based in

So it managed. assume doesn't senior the in any acceleration housing

to Obviously, that crystal number. didn't if have So so to is that that then I there I we bake ball, don't to run number would be be, improved which the because into but improve we well. want would incremental a there -- there, rate, to as expect expect yes, that performance

those transition, about, In several are the talked quarters. ongoing, for the last as of we've terms

picked to and of expect alluded fully of that to we going to roll XXXX. and transitioned expect realized by that you in to by incrementally pickup terms it those be the in when earnings end in. the up be to, getting going things vary it's But they're situation. end NOI vary Again, It's by We of our there project still in be 'XX. by those to fully

current rate. was impactful run the Nothing in

XX year? $X first the in in the quarter those generated $X an you million relative are assets to of what last have a on annualized Do sense to quarter basis the second million

said I've to stories higher different projects, $X if that mean, XX less million than there's -- I million. million, $XX probably again, there. $X it's XX but before, there's than It's it's like the

be is on has whole be to dependent But disclosed since timing a what and rate down exactly So million an It's we in it going QX. it's hard going that basis. overall $X increased factors. of pin on run back lot to that other to

assets the were can as the you wholly-owned XX curious in whether up this timing shed or to of any would store quarter? a light short same performed? Just Enlivant, sort operators Just list? helpful. how far kept assets the a you transition, that as of lined those just detail then -- pool around some they And leased on then have any be And

they of been So of are have the had performance pool, one -- actually months. of they same-store over drivers of are last assisted And pool. the they've in living the strong component because a recovery XX the the

or breakeven If you call recall, were, they X so. year it ago

So real -- they and strong margin a growth. have and actually now between recovery REVPOR on occupancy

Yes.

the of cooperatively terms Enlivant just TPG work to In with that. trying transition, well, we're and on

should happen So portfolio. coming the the specific issue but operators have of a of timeframe. can't We I it months, an in in that give a number know

right for So of an issue us. be identifying a going or is to not the in itself and concern operator

comes with Valiquette Our next question Steven from Barclays.

but think delineated just A So that of supplement. is guess normally go X, on far first included I page coverage was one. then on there X, housekeeping exactly a as EBITDARM which data that page the still it be same-store as know sorry, that number I like that -- really good question kind that would of is occupancy don't quarter was in on properties I around Maybe X, normally X, X are same-store are kind X, I ahead. follow-up. more or page ratios number housekeeping I guess -- that the guess of data, as questions if couple this pages and not on the And data?

No, go ahead.

Yes.

through. as we go it answer I'll

at our information is, of is question is store noted. triple the not to net your took quarter, the pool. and store. out as included majority that stabilized So portfolio, same entire stabilized the you've is answer this our portfolio for same That We

review take same-store our for We of triple evaluation is periodically, we we for many not present helpful disclosures. an disclosures. that and information. market and people the Just disclosure what net our We review peers' investors, noticed

kind portfolio outlier and investors. an useful was in regard, indicative that the we were more we So for overall of and more thought

before change when we seek do as from And -- investors we about disclosures. we we feedback typically some did that, out

And might then the stabilized on in triangulate like the you count that's of consolidated. stabilized XXX the that Looks then, then show the X XXX that, properties number footnotes total page and just portfolio on pages page to on like around property the X same are sort X, in portfolio. X. And be

And So are be that right? are or to XX the if makes we slide. in offline roughly do follow hard there I basically properties? But give hopefully the question that not happy do stabilized Am that it's I'd doing on if it, it sense. do up properties of to to kind of take need offline, or set math this too,

Yes.

math I on so follow-up Let's one can that offline that do softly.

question with comes Our next from Malhotra Vikram Mizuho.

So I -- run to ins just wanted follow-up and FAD the to just outs on the rate.

senior end or then an that in additional through going again? leaving through also You start the but impact will of Enlivant alluded talked 'XX? you FAD may Can of us you Are transition, you is the aside, assets housing additional -- walk that 'XX sort also additional about just year that I of there early was there the 'XX, 'XX, there the transition bucket to into said, into some you maybe conversions. benefiting to transitions. Potentially, think, Canada, in

something it led portfolio, transition year, may dispositions to around to doesn't mean assets We're or I there portfolio than may assets be properties than year. our and our no to I'd to new to transitions, always opportunities and portfolio, the portfolio. that to about that stopped. convert transition our impacting portfolio, of going anybody evaluating different or and but There always impact is quite QX in still portfolio for other any that's stuff say opportunities mean, be we're is looking may to our since that talked degree operators. operators, did company. frankly, what our last new at best opportunities to underperforming a at looking We're us That's be that significant else's our that portfolio. material be we've behavioral health. conversations The which to outcomes We will last our

material. nothing incrementally, So,

to look much, year. through So, as bucket similar tackle size bucket a smaller it's It's not last would a you much year… like the that

correct. That's

and Enlivant. over above

say, of walk then just capital at things the mentioned but broader additional, potentially, all I of decide preferred investment assets, on as of or investments Richard additional that's but also, in and going you equity skilled even structure but sort sort slow And broadly, senior the debt around given housing? can nursing, know to loans opportunities, make are investments, Okay. evolving, maybe that in terms you markets looking through may

to answer try I'll Sure. that.

we to look us about ways seeing coming them assets that yield, has of We invest, underperforming or that leads of and preferred opportunities a and are and that Few us. equity, It something higher today. remains We mezzanine want is or we or pricing to more what yield, are at interesting. the flow or are our think assets reasonable our higher to capital, is unclear focus on of term. Right be opportunity exactly to longer full now, in full pricing. what seeing greater debt, cost

that why the are of think I of continuing at issue levels rate discovery, to hope challenge, a create terms seeing we in would level as is and both things, a bit debt availability, a -- opportunities as we credit et liquidity for reduced terms there borrowers, that's in and at a we the developers, price in us. interested of with proceeds cetera. interest And for look are we well significantly are because would being

are creative So assets in probably capital be. a of far, to and we they used frankly, look, where at recovering stack to are structure particularly be we continue to down, try but recovering cost well, are senior that we are but There continue haven't housing, upside values their that is so their this to found there. point, lot and and not them,

of and out recalculating the is borrowers, a a and of on, that's So, other the investors going going to readjustment lot time. next period the lenders, capital, of outcome lot of of tensions and between there's over play

received goal yourself. the believe you in I had, if wondering I'm wrong. PLR just and was? Correct what objective PLRs, about Just I'm in this you to fact -- remember, healthcare one the it last lot in alluded talk space or to obtaining of XXXX, or a there was thing, quarter, XXXX I had was If one that me, clarify. the of I that wanted maybe

we living discussed reason independent aware, that the the could did way living, facilities receive it have triple that. holiday PLR, non-lease the we own structure. net and lease, only independent get have was not last through was quarter, living We that is we space so as could independent structure. us and in as first That was that you're a facilities a enable Yes, why PLR lease is that, to we which all not under to in and got a Absent were portfolio, it. to we have -- we our

reason behind that rationale whole the the and that getting So PLR. was

point optionality intent do ability that It's in time the we this operational to perspective, aspects operators if It that. facilities because time, quality the have we of an in at to our time. not from point some to which at independent that have strive possible, choose in our this differently at maintain of the living also something the provides is we in us, as so that we for always of approach company as many things

Street. comes question with Michael Green next Our from Stroyeck

One of take and follow-up potential could transition, as result well, just of us you Enlivant operator wholly-owned base terms degradation they're a could but NOI on a you the see performing we I reasonable the to portfolio transition? case through mentioned in know

I'll take that. Yes,

different a there had, case. distractions transition Enlivant costs, to So given have There understandable a the don't degradation when management a with distractions operational be of will of -- in there results the the none frictional transitioning sale known of is But is operator. has any that to operator actually some process, think facilities are distractions portfolio. that bringing of costs an we variety new portfolio we upside that entire the the working lenders, may those base operators, be We frictional temporary. always that us, an team you that think has with to as in

normalization one in expense know the And to then other expense been I agency back quarters. on moderate much a shop is called it's line coming past earth items? out few you How just that over versus of one growth. quick labor

largely It's agency labor, exactly largely the you what costs. It's said. the

the not in non-labor significant Yes, seeing call, little earlier we're bit as inflation it's I noted on a the just category.

a improvements flow getting the the else their better as top-line way. in through then So without operators handle will costs, on better anything labor the just get

question Griffin from Michael our take We'll with Citi. next

terms think bridge-to-HUD if I external you called then. was up of in that Do moved that appreciate be longer-term wanted we financing in permanent so just you're probably since it's It's maybe when the the rate might I regime, permanent of that mid-Xs. sense, sort Talya, have mentioned stuff. financing? touch maybe a transactions, underwriting far, follow-up. where back to after been to interest but on growth I think low don't

quarter, we seeing don't the post-Fed so probably tell I it's hike figure construction as have about like yesterday, I to a around but just, and it I just you non-HUD, to quotes will XX% currently floor Xs. at that loan-to-cost, of X.X, stuff you at debt are scale. HUD, being Yes. other debt in a give but non-bridge X and rate in that's quoted

labor in you the with follow-up X.XX year flat is that where was when your that exactly where ago. stayed times today, spiking, the on was, and have a expenses happened question to annual a just And trailing to increasing, intervening It fact flat timeframe has encouraging. you XX-month Michael, earlier what increases coverage it is flat, basically rent basis. Hey, pretty ex-PRF, a like, was it and on consider

from with our take next Sanabria We'll Instructions] BMO Capital [Operator question Markets. Juan

on Seniors couple coverage, you to TX it's how Would A improving. the coverage, SNF I guess be of for Portfolio? and Housing the about ex-PRF, questions. able the you talked give

we XX-month it. than because, did trailing that, higher Juan, disclose say, is yes, number. It We'll is our not

Avamere, Signature that as and the be Would well? case for

third case fingertips. they of second In and of Signature, Avamere, at have the that might a had case In be the tough my it quarter. I up. slightly don't

for today, the So, arrears. a really the quarter right-sized bounced first once them closures in and those got they are in back first that they've leaner not refocused current quarter, got I'm corporate dramatically company all behind super about and they and talking sales, quarter.

months since preliminary numbers year alluded trailing Yes, as Rick right calendar then, again, numbers ended about, of There's in trailing first and to the earlier, talking XX. are the and for headed X-month X December the months X in and direction. encouraging are we're quarter actual been the we've 'XX come seen

could a dispositions quarter, cap that share or run booked for purposes And you was in or the then, curious to modeling rates completed, yields on you just rate the NOI the if the help on first us basis? guys

Yes.

dispositions, we terms yield called And we on of the of activity disclosed the in disposition mid-single the was for the majority as like, back So, in said our vast digits. quarter. that February. We disclosed, then,

that had sales didn't metric. whatever between small, quarter that the overall and X were and point incremental one really change So, we

still number with. that's a go think I good to So,

are or and the And the of are Is pipeline? X%. or for then, those development them necessarily…? assets indicative pricing, deals like, today's of those were one of make do Is are investments you kind at in the a was think, did -- where how not trading today, quarter new that unique from you that situations

unique larger to cap ours situations. campus one as the other an a and with us a building a just bulk the who's -- was create or it of the was across other yield small a of then allowing will, is the rate. operator one And property are you Those that way. One, in substantially pipeline that you from a -- was development so said, pre-negotiated if

didn't small have to unusual So, campus an of another We of building. it a the folks lot on a rushing buy building was piece.

you've broader loan space And going? news that in The healthcare aware about curious I'm of anything you loan in mind. one if don't should book, of Some how REIT last just book? be your one, terms of current we the feel had? you loans some potential risk

don't of is loan change, bulk nothing had to foreclose. not and think portfolio. not It's really any large they that It's at I it a Ventas like the the risk. there's

-- have, Yes, mezz these they're loans are not we that Juan.

Austin with KeyBanc question our We'll Wurschmidt take from next Capital Markets.

for basis the you us current tenants operators follow-up to with looking time, long-term percent enter plan remind and guys of Can into or the those are contractual potentially of Yes, those what operator? or cash either new whether maybe me. you're what for just on a is operator leases some sell one your quick over assets a

Yes.

different focus our They'll various a in are I've of we It down. NOI. of now cash cash amounts. pays amount this versus it was us the So month previous has pool transitions some the done, like some X% pool, we've that before said right? month, quarters, basis tenant in terms part pay the next portion pool tenant the and us our on come of call the of X%. sales Through basis somewhere, that really our of X%, it's that And

component whether like we've about before, And that's of So the portfolio, we're doing to a it sales activities through it going that. the or talked be transitions, large is down. address coming on

further back like to call over And this there the no I'd time. are questions at turn Matros. Rick to

forward. us. at do us joining for we've that everybody, least behind good to feels feel Thanks, gotten pretty things worst the It good and really believe about going

great again, Thanks the joining a us support. So for thanks today, for and have day.

concludes this conference. And today's

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