Net operating income growth in Welltower’s senior housing operating portfolio exceeded 20% for the fourth consecutive quarter, CEO Shankh Mitra said Tuesday during the company’s latest earnings call.

The Toledo, OH-based real estate investment trust saw 26.1% NOI growth in its SHOP in the third quarter, the “second highest level of growth in the company’s recorded history,” Mitra said. The REIT’s total portfolio generated 14.1% same-store NOI growth, according to Chief Operating Officer John Burkart. 

“While we are pleased that margins are moving in the right direction, we are also mindful that our profitability remains significantly below pre-COVID levels and below where we believe the industry can attract external capital investment on a long-term basis,” Mitra said.

SHOP year-over-year same-store revenue increased 9.8% in the third quarter, driven by 220 basis points of year-over-year average occupancy growth and growth in revenue per occupied room of 6.9%.

Expense per occupied room, or ExpPOR, remains low, “enabling the business to improve the margins,” Burkart said. ExpPOR growth for the quarter was 2.4%, which Burkart said was the lowest in Welltower’s recorded history.

As of Sept. 30, the REIT had approximately $6.7 billion of available liquidity, including $2.7 billion of available cash and restricted cash and full capacity under its $4 billion line of credit.

Chief Financial Officer Tim McHugh noted that Welltower closed on $1.4 billion of acquisitions and loans in the quarter, led by $618 million of senior housing operating investments.

According to a press release issued in conjunction with the earnings call, Welltower revised its full-year 2023 net income attributable to common stockholders outlook to a range of $0.91 to $0.95 per diluted share; the previous guidance was $0.75 to $0.84 per diluted share. Full-year normalized funds from operations attributable to common stockholders guidance has been revised to a range of $3.59 to $3.63 per diluted share; the previous guidance was $3.51 to $3.60 per diluted share.

“To sum it up, the powerful recovery in senior housing operating business, the rollout of our operating platform and a significantly accretive capital deployment are all setting us up for an accelerating earnings and cash flow trajectory for 2024 and 2025,” Mitra said.

For additional coverage of the Welltower earnings call, see McKnight’s Senior Living and McKnight’s Long-Term Care News.