Second-quarter earnings calls continued Friday with updates from CareTrust REIT, Diversified Healthcare Trust, Omega Healthcare Investors and Ventas.

Omega Healthcare Investors

In three separate transactions in the second quarter, Hunt Valley, MD-based Omega Healthcare Investors acquired 34 facilities for a total of $114.7 million and leased them to an existing operator and two operators new to its portfolio.

The REIT said it has completed $648 million in new investments year-to-date.

Omega also commented on the previously announced news that Atlanta-based LaVie Care Centers, which operates 43 licensed skilled nursing facilities or independent living communities across five states, filed for Chapter 11 bankruptcy in June. Omega is the company’s largest landlord.

“Omega believes this filing was a necessary and important step in creating an entity that is operationally solvent and sustainable with enhanced liquidity and a strengthened balance sheet,” Omega Chief Financial Officer Bob Stephenson said on Friday’s call.

“We continue to believe that there is meaningful value in our portfolio of current LaVie assets,”  Stephenson added. “Omega has been working with LaVie for over a year to assist it in reducing its continued exposure to underperforming assets, which in turn has alleviated some of the financial burdens on the current LaVie portfolio is sustainable and will support long-term annualized rent of approximately $36 million, while also retaining sufficient cash within the business to provide for strong clinical care.”

As part of Omega’s debtor-in-possession loan commitment, during the period of bankruptcy protection, LaVie is required to pay the REIT full contractual rent of $3 million a month on the properties LaVie continues to lease from Omega. LaVie has paid approximately $3 million in rent in the months of June, July and so far in August. Before filing for bankruptcy, the company paid $1.5 million in each of April and May.

Booth said that Omega expects LaVie’s bankruptcy to be resolved before the end of the year.

In other news, Omega reported that at the beginning of the quarter, in April, it transitioned its remaining six Guardian Healthcare facilities to a different operator for minimum initial annual contractual rent of $5.5 million. Rent could be increased in the future depending on revenues received by the operator.

For the second quarter, Omega said, the REIT received rental income of $2.8 million from the new operator, including $1.3 million of base minimum rent and $1.5 million of incremental rent. 

“We’re assuming the new operator of the Guardian transition facilities will continue to pay rent of $2.8 million per quarter consistent with the second quarter,” Stephenson said.

Brockway, PA-based Guardian filed for Chapter 11 bankruptcy protection last week for its 19 SNFs in Pennsylvania and West Virginia.

Meanwhile, in other news, Omega said that in July, it reached an agreement with the estate of Greg Smith, the late president and CEO of Maplewood Senior Living, to transition control of Maplewood.

Smith passed away unexpectedly in late March 2023. Under the agreement, which must be approved by a court, members of Maplewood’s management team will assume Omega’s lease and loan agreements.

Omega reported that Maplewood paid $11.8 million in rent in the second quarter compared with $11.3 million in the first quarter. In July, Maplewood paid $4 million in rent.

See additional coverage of the Omega call in McKnight’s Senior Living.

Ventas 

Ventas’ second quarter was marked by “executing on our focused strategy to capture the unprecedented multi-year growth opportunity in senior housing,” Ventas CEO and Chair Debra A. Cafaro said Friday in prepared remarks. 

Same-store cash net operating income in the Chicago-based real estate investment trust’s senior housing operating portfolio grew 15.2% in the second quarter, led by US growth of 16.3%.

The company said it improved normalized funds from operations per share guidance for fiscal year 2024 to $3.12 to $3.18; previous guidance was $3.10 to $3.18.

Year to date, Ventas said, the REIT has closed on approximately $350 million of investments focused on senior housing, with additional near-term investments expected.

See additional coverage of the Ventas call in McKnight’s Senior Living.

CareTrust REIT

CareTrust REIT marked its 10th anniversary in June “with a record-breaking annual investment milestone and a total shareholder return of 247% since inception,” CEO Dave Sedgwick said in a press release issued in conjunction with the San Clemente, CA-based real estate investment trust’s second-quarter earnings call. 

After the quarter ended, CareTrust REIT funded approximately $378 million in new investments in the week leading up to Friday’s earnings call. Those investments were funded using cash on hand, the company said. 

The acquisition includes 21 skilled nursing facilities and 16 senior living properties that had been operated by Prestige Care or Prestige Senior Living and are located across Alaska, Arizona, California, Idaho, Montana, Nevada, Oregon and Washington. All of the properties will be operated by subsidiaries of PACS.

“As of today, our year-to-date investment total equals approximately $765 million at an average yield of 9.5%. The investments announced today are the realization of our consistent messaging that this year would be a unique one in CareTrust’s 10-year history. And we are not done yet,” Sedgwick said in a separate press release.

See additional coverage of the CareTrust REIT call in McKnight’s Senior Living.

Diversified Healthcare Trust

Newton, MA-based Diversified Healthcare Trust “exceeded expectations” for performance in the second quarter, according to President and CEO Christopher Bilotto.

“In addition to favorable tailwinds in senior housing, our results are benefiting from the prudent capital investments we have made within our communities and from an emphasis on improving operator performance,” Bilotto said.

The REIT reported seeing a 27% year-over-year increase in senior housing operating portfolio same-property net operating income, driven by an increase in SHOP occupancy and corresponding increase in revenue per occupied room.

“With continued favorable SHOP industry trends, we are well-positioned to execute on our priorities for the remainder of the year. We remain focused on achieving our SHOP NOI

growth target for 2024, as well as strengthening our capital and liquidity profile,” Bilotto stated in materials released in conjunction with the earnings call.

Chief Financial Officer Matt Brown said that DHC ended the quarter with $266 million in unrestricted cash. Part of the REIT’s financing strategy for the rest of the year, he said, is to issue secured fixed rate debt with select communities in the SHOP.

“We are having meaningful conversations as we work through the due diligence process and we currently expect to complete this financing in the fall,” Brown said. 

DHC reaffirmed its full-year NOI guidance for SHOP of $120 million to $140 million, with the expectation that third-quarter SHOP NOI guidance will range from $31 million to $36 million.

See additional coverage of the DHC call in McKnight’s Senior Living.