In This Article:
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Total Revenue: $386.9 million, a 4% increase year-over-year.
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Adjusted EBITDA: $75.1 million, up 17% year-over-year.
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Normalized FFO: $14.3 million or $0.06 per share.
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SHOP Same-Property NOI: $38.4 million, a 33.6% increase sequentially and a 42.1% increase year-over-year.
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SHOP Revenue Growth: 6.5% increase year-over-year.
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SHOP NOI Margin: Improved 320 basis points year-over-year to 11.2% on a consolidated basis.
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Same-Property Occupancy: Increased 130 basis points to 80.2%.
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RevPOR Increase: 4.8% year-over-year.
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Medical Office and Life Science Leasing Activity: 145,000 square feet with rents 18.4% higher than prior.
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Same-Property Cash Basis NOI: $71.5 million, a 20.7% increase year-over-year.
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G&A Expense: $2.4 million business management incentive fee.
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Capital Expenditure: $32 million, with $27 million in SHOP communities.
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Unrestricted Cash: Approximately $300 million at quarter-end.
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Net Debt to Adjusted EBITDA: Declined from 11.2 times to 8.8 times.
Release Date: May 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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DHC reported a 4% increase in total revenues for the first quarter, reaching $386.9 million.
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Adjusted EBITDA rose by 17% year-over-year to $75.1 million, exceeding analyst expectations.
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The SHOP segment showed significant improvement with a 42.1% year-over-year increase in same-property NOI.
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DHC completed $332 million in asset sales, aiding in deleveraging the balance sheet.
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The company successfully addressed upcoming debt maturities with strategic asset sales and refinancing activities.
Negative Points
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Same-property occupancy in the medical office and life science portfolio decreased by 10 basis points from the previous quarter.
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Known vacates in the medical office building and life science portfolio are expected to be modest but still present a challenge.
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The company faces a significant amount of debt maturing in 2026, requiring further asset sales and refinancing.
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Despite strong SHOP performance, the company did not increase its full-year guidance due to uncertainties in disposition timing.
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Operating expenses in the SHOP segment are expected to trend about 3% higher in 2025 compared to 2024.
Q & A Highlights
Q: Can you provide some color on the occupancy gains for the first quarter, especially given the seasonally weak quarter for the industry? A: Occupancy has improved due to several factors, including capital investments in our communities and operational initiatives. We completed 23 refreshes in Q1, which contributed to the improvement. We expect this trend to continue into 2025 as we position ourselves better in the market.