“Our first year as a listed company is off to a great start,” American Healthcare REIT President and CEO Danny Prosky said in a press release issued in conjunction with Tuesday afternoon’s second quarter-earnings call.
The Irvine, CA-based real estate investment trust launched its first public offering in January.
“Within our managed segments, our integrated senior health campuses operated by Trilogy Health Services continue to set the standard for healthcare operations across all levels of long-term care, particularly assisted living and skilled nursing,” Chief Operating Officer Gabe Willhite said on the call.
American Healthcare REIT owns 76% of Trilogy Health Services as of April 15. According to Willhite, the operator’s offerings are 55% skilled nursing and 45% senior living, the latter of which is predominantly assisted living with some independent living.
“And you can see this reflected in our 24.1% year-over-year, same-store NOI [net operating income] growth within that segment in the second quarter of 2024 compared to the same period in 2023,” Willhite said. “Trilogy’s unique model, purpose-built facilities, and strong reputation have continued to drive demand.”
Overall, AHR’s occupancy saw sequential gains in the second quarter, with a 20-basis point increase from the first quarter.
“And occupancy continued its climb higher subsequent to the end of the second quarter, with spot same-store occupancy as of July 26, 2024, at 87.4%,” Willhite said, adding that “skilled nursing occupancy in particular remains well above industry average.”
Chief Financial Officer Brian Peay said that AHR is increasing its full-year 2024 normalized funds from operations guidance to a range of $1.23 to $1.27 per fully diluted share. This represents an increase of $0.04 to the midpoint of earnings guidance.
“This upward revision is primarily due to the increased expectations for NOI growth in 2024 across our combined same-store portfolio of between 12% and 14%,” Peay said.
Peay said the company anticipates the integrated senior health campuses segment to grow between 18% and 20% and NOI growth in the senior housing operating portfolio to be 45% to 50%.
“The pace at which demand increased among our managed care segments is a positive development, prompting the revisions to our total portfolio and segment level NOI guidance for 2024,” Peay said. “In my mind, and as I’ve mentioned often, it was never a matter of if we would be able to achieve this level of performance, only a matter of when. And I’m glad that we’re getting there faster than we had originally forecasted.”
