Financial Data and Key Metrics Changes - The company reported normalized FFO per share of $0.88 for Q3 2025, representing a 10% year-over-year increase [28] - Total company same store cash NOI increased by 8%, driven by a 16% growth in SHOP [28] - The company expects a year-over-year growth of 9% in normalized FFO per share and 7.5% in total company same store cash NOI at the midpoint of the improved guidance [12][31] Business Line Data and Key Metrics Changes - The SHOP segment achieved a same store cash NOI growth of 16% year-over-year, with U.S. communities leading at 19% growth [17][28] - The Outpatient Medical and Research (OMAR) business reported same store cash NOI growth of 3.7% year-over-year, with outpatient medical occupancy improving to 90.6% [28] - The research business, which represents 8% of the company's NOI, saw a decrease in same store cash NOI by $400,000 year-over-year due to lower rents on certain tenants [28] Market Data and Key Metrics Changes - The U.S. SHOP portfolio is currently 85% occupied, with significant upside potential for occupancy growth [20][23] - The over-80 population is expected to grow by 28% over the next five years, indicating strong demand for senior housing [10] - Senior housing supply is at record lows, with only 1,200 new units started in Q3 2025 [10] Company Strategy and Development Direction - The company is focused on growing its private pay senior housing operating portfolio and anticipates closing $2.5 billion in investments during 2025 [8][12] - The strategy emphasizes organic growth in the SHOP business and capitalizing on favorable demographic trends in senior housing [8][9] - The company has transitioned 27 of 45 senior housing communities from triple net to SHOP, expecting significant occupancy and NOI upside [13][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to capitalize on the growing demand for senior housing, with a strong pipeline of investment opportunities [9][12] - The company anticipates continued strong performance in the SHOP segment, with expectations for occupancy growth and improved pricing power [17][18] - Management highlighted the importance of maintaining strong relationships with operators to ensure quality care and performance [20] Other Important Information - The company has raised its total company same store cash NOI growth guidance by 50 basis points to 7.5% year-over-year [31] - The net debt to EBITDA ratio improved to 5.3 times, reflecting a full turn improvement from the previous year [29] - The company has over $4 billion in liquidity as of September 30, supporting growth and financial flexibility [29] Q&A Session Summary Question: Can you discuss the underwriting criteria for acquisitions? - Management indicated that they are ambitious in growing the senior housing business and are open to acquiring properties with lower initial yields if they offer higher growth potential [34][36] Question: What is the target leverage and how do you weigh equity and debt for growth? - Management confirmed a strategy of organic growth plus equity-funded investments, with a focus on investing in the best assets [39][40] Question: Can you provide updates on the Brookdale SHOP transitions? - Management reported that the transitions are progressing well, with a focus on routine refreshes and minimal disruption to current results [44][46] Question: How is the independent living pool performing? - Management noted strong occupancy growth in independent living, particularly in former Holiday communities, contributing positively to overall performance [105][106] Question: What is the outlook for external growth in senior housing? - Management expressed confidence in the ability to continue external growth, citing a strong investment pipeline and favorable market conditions [91][92]