LTC Properties (LTC) 9 Aug 182018 Q2 Earnings call transcript

Good morning and welcome to the LTC Properties Second Quarter 2018 Analyst and Investor Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Before management begins its presentation, please know that today's comments, including the question-and-answer session, may include forward-looking statements, subject to risks and uncertainties that may cause actual results and events to differ materially. These risks and uncertainties are detailed in LTC Properties' filings with the SEC Commission from time-to-time, including the company's most recent 10-K dated December 31, 2017. to or update of circumstances obligation to forward-looking this no events reflect after undertakes revise these or statements presentation. LTC the date this note, event being Please is recorded. Wendy to conference I turn now like over would to Simpson. the Ms. Simpson, Please ahead. go

Thank Second Investor you, Call. XXXX Quarter operator, everybody LTC's welcome and to

will Chief some a Joining me and Clint introductory a answers. sales, portfolio, results. Pam follow begin with our we remarks. of our Kessler, I'll our begin And the and Clint wrap-up our brief performance. Then commentary today Officer. CFO; the discussion potential financial operator are questions before and with Malin, I Pam on Investment provide call with will finish will asset partner

for continued success. been long-term have focused and laser strengthening LTC We evaluating on our position portfolio,

closely best offer preferred Importantly, goals, operators' go real to solutions that leaseback we to traditional ventures, strategies estate needs. joint our lending financing meet operators, beyond mezzanine creative sale including various and and by equity listening

focusing business we pay of emphasize took cannot enough relationships. bolster that The majority During meaningful have another operators. regional quarter, sourced steps relationships venture estate acquiring a building communities, built credit. line dispositions, entering new market. our on new adding were operator into our By off added five We private partnership, the on connections, is new operator these of joint and we business real toward completing by asset strategically second additional working to

properties to contemplating are the and we these or to market, selling the prudent excited sell We are it We the in opportunities investments. selling are into long-term new recycle selectively each potential about current assets identifying older. Most capital continue companies. with that for believe that growth of remains

wants us to buy yet our to a non-core the who tenant others may be and back. property be driven by may partners Some or

color will to sense, later if While Clint will asset strategically could only more advantageous financially many offer LTC. call. we there reasons an and make sale is on the proceed are it

Now ability an work on them Anthem's they community couple achieve update at July Occupancy ensure to but up line of XXXX. increased with operators. closely a pay Anthem's our XXth. rent to expectations, provide in at goals current committed pleased from for Marietta they to to our XXst, I'll higher continue to with at We XX% remain XX% the April with

at the communities Oaklawn, roughly Glenview which and late Ridge, admitting in Burr Park, residents occupied Tinley flat. While July in began May was were XXst. XX%

an as with lease flat Thrive, deferred at July continued been and through basis, of across lease-up their XXst through to was XXXX softness. provide to on Thrive million April rent we the June form We of our to Thrive On aggregate worked up amendment compared XX, XXth. portfolio have monitoring they closely support when operations occupancy signed recently progress. Moving in a to just $X.X

$X.XX at Before on XXXX per and things The asset I'll no expected is of issuances, now share. range. XXXX to guidance. between but equity I financing FFO of each activity, $X.XX for to turn sales. over new assume is increase certain our Pam, the does provide end an or be additional an This assumes $X.XX update investment guidance

Next hear Pam. from we'll Pam?

last was increased a short-term accrual cash loan originations down sold within $XXX,XXX as projects. about during in FFO per as balances over and past result NAREIT $X.X were second a million Revenues $X.X decreases year's rather year basis average acquisitions in putting outstanding G&A an revenue of on our the $X.XX The Revenue Interest disclosed. higher Wendy. projects, were than partially a by to from million and improvement $X.X quarter expense and $X.XX an expense quarter. million quarter target increase expense. compared reduction offset interest last development due completed related debt increase decrease with second been properties previously to million higher year's was Anthem in quarter. you, and revenue has capital to $X range Thank from interest the in mortgage rates.

to rest of the in remain the this quarterly range year. expect We for

conjunction During memory the Sunrise In we the its quarter lease Texas for $XX.X of our and in million $XX.X expiration, acquired communities in recognized portfolio with a gain of sale completed we $XX.X million. and for QX, two million. care

in discuss funded land transactions new purchase in made these estate greater Oregon. also joint $XXX,XXX a will for a venture We real by detail. Clint

we commitment includes into facility. agreement The new a the credit XXXX total $XXX replace former to mentioned, up entered to Wendy also ability of As a million with a our credit $X new unsecured agreement increase to billion.

$XX fee the by be this XXXX extended We the a projects facility year, The to under fee. with and of commitments our to LTC's the unused and million under end $XX.X improvement and of dividend we We per additional LIBOR second of interest under one-year facility XX million of second outstanding expected a At at under properties million rate projects. Subsequent discretion. of third and maturity a converts commitments to completed capital have under the basis In million to credit June development senior $X.XX at the the with XXXX, and commitment during we almost Of and funded for our in borrowed in the we monthly three share under one option the improvement unsecured quarter. XXXX. acquisitions XXX is June points owned in capital reduces second and development quarter notes. from June quarter, agreement $XX.X million of one, basis pricing agreement total the renovation, XXth, margins the of repaid projects, quarter million bringing $XXX line $XX we million. and $XX.X $XX remaining two with fourth totaling to fees development existing payment to had of outstanding credit the borrowed fund facility the plus XX, the a an extension line points. also At XXth,

$XX.X remaining commitment. equity loans have on commitments and properties under mortgage and renovations in seven preferred million $X.X also located under expansions remaining Michigan in for We million

enhanced conservative agreement true million million remain our many Prudential, under well $XX sheet and balance remains and our us our and initiatives. of a $XXX $XXX ATM philosophy, capital us credit giving under the dry future cycles. us real under feature giving million. strategic through $XXX allocation remains million line shelf $XXX we've with our with Currently, liquidity a total estate powder which of Our of growth program, new through additional to has million We strong availability served accordion available flexibility fund line credit, to and our

well-matched debt remains free cash Our flow, maturity to risk. our profile refinancing projected moderate helping to future long-term

Additionally, of debt over normalized no major enterprise credit of XX%. as years. second X.Xx, long-term five the to value well about fixed you and of with ratio end to a EBITDA debt of know, compared charge metrics debt maturities to our At average health normalized coverage annualized quarter, the annualized next care the industry we have a REIT the X.Xx

Now Clint. Clint? call over to I'll turn the

Thanks, relationship detail estate Pam. additional joint to Texas I'd our like Oregon. in start by venture and acquisition about in providing real our

to of them [ph] X.XX%. memory purchased through communities. care I'll about continue were operate at a communities Kelsh a sale under and master which Texas will a XX-year from leaseback Kelsh First, cash the is yield lease developed in talk two starting

XX $XXX,XXX free in accommodations. the The to located provide XXX Frisco rent agreed next and and communities of approximately Worth XX in process, suite underwriting part months. including both the and units As over private we comprised and are Forth beds companion

memory in years' operating LTC's XX states. in Kelsh portfolio of experience and XX care the New partners, eight operating assisted of has and living, care operates currently living, rest to housing communities seniors communities independent

cultivated in opportunity. contact of for They several during strong represent the right growth-oriented investment years the Our time relationship with we Kelsh was remained regional operator. waiting over close which type

faster are on for enhance We our growth and portfolio relationship lasting to focused future LTC. building

cost, by and living with construction approximate community The venture Wendy necessary sale joint acquisition yield living independent XX-unit is LTC venture plant solutions total meeting as expected the yield listen $XX.X real purchase assisted needs the Field demonstrating the total adjacent mentioned, unit operated contribute memory project Pam the the completion end also Living new This Medford. strategic an of Senior Senior of the by contributing and received care approximate with venture of in create requirements. X.XX%. with LTC's and operator's capital X.XX%. the develop is joint investment, an Field to the we The and in currently Oregon a to an The million venture a our acquire completed owned completed. with creative land estate Of begun deals into to of XX% XX Fields estate and partner provide has XX% joint financing acquisition The we entered campus. community in $XX.X real third agreement quarter. to operating million initial third a LTC and to to partnership Living past months, XX a XXXX. executed acquisition cost integrated have willingness their joint is the permits will close initial has Regarding

tracking are new operator relationships, by we decreasing age average result, the assets. of portfolio dynamic a As newer adding while our

disposition skilled and September sale with one are older living we buildings by closing community comprising continually nursing to portfolio agreements our and dates portfolio, our current signed the centers opportunities. we Given three have identify evaluating in market, purchase three XX. four independent Currently expected

to proceeds We be included to pay GAAP and of As rent. proceeds met around sheet there are balance certain use sales million, our initially our down line XX always, to of approximately need our closing. are providing proceeding guidance. additional in the conditions that three FFO X.X credit, The million expected to are annualized plan These flexibility. represent

gain total $XX transactions from expected approximately million. on Our is these sale

run have a communities assisted intermediary for engaged As located or in previously, two in noted living California. re-leasing to selling we process

the end and the process, August. of of a by are We end nearing decision anticipate this

our month EBITDAR portfolio. portfolio traling-XX X% the EBITDARM numbers, X.XX and assisted for times that's and times coverage nursing times for X.XX times X.XX management for a portfolio; our QX using X.XX skilled fee, Now and respectively respectively living and

reported majority quarter the previous coverage six partners, to four nursing quarter reduction the these operating skilled of portfolio no As a single in are decline. a reminder, point and metrics broad arrears. spans The one industry reflects in from our operator trends basis contributing with

rate increase in some operators. the sequential seeing nursing and portfolio, in improvements which two New X% positively operators, quarter-over-quarter positives Medicaid are two our skilled of at Mexico, of We impacts four including our

a is beginning in Medicare there X.X% increase October. rate Additionally,

have coverage with our a for portfolio our nursing Although EBITDARM shipped we with given we the cannot on month comfortable position. times current skilled basis, of X.XX trust feel the say certainty we trailing-XX

Wendy Now I will things for turn Wendy? up. back a wrap to

as are we to Thank a partners different good opportunities are have strategic cycles maintain or helped only business willing rational and Staying environments. who and relationships, which turns and such and now importantly, used many and prepared not have supportive most through to right the opportunities. we acquisitions no problem our the waiting down but fully bias, we challenging us And you, We investors, lasting for swiftly true advantage we're take Pam right when in, build conservative patient fit. our are regional Clint. more and has a philosophy, and growth to the the one the are advantage to that through operators participants pricing, market time so navigate cycles of

through will we We're We're a shared and Thank at We're value continue you said value can as start us operating we and for are well-funded questions. these our long-term your shareholders. call, culture could today. always, partners join of business that and sure relationships our success. ready significant trust, I the LTC. making to absolutely for of again. essential intentional, generate you and for And glad anchor As our transparency, driven the

begin the Please question Sadler from now question-and-answer today KeyBanc. go Instructions] ahead. first will We The with comes [Operator session. Jordan

of Thank and or might little if discussing, run be Was that resulting But you're to you're good analysis, maybe to more location, some just type some in that a you more morning. assessment the portfolio through be wondering those as sales obviously looking some your things relates that helpful. will of the property at. were the facility it's that to bit are and factoring able of either Wendy bit age that outlined in continue. And would and/or a it around parameters flesh little

we we first and the at us Jordan, pricing you. them. potential for we're have then think monetize of an cycle Primarily find we're older assets have then to looking new at thank end an we're us in the negotiating it's wait probably environment and lease the operators. lease. growth so older till that than those a relative We're at, with looking for of today's we appetite looking the because to Yes, looking first down at opportunity And And operators that. the older a in where don't assets, the our rather with advantage quite asset

it. them should are or cut that assets first we of at look within portfolio So do operators not growth, some is that's there's our just strategy cut asking to that And of this feel second time. there we looking are part the at that that older assets monetize and their the

assets, at a not we think those portfolio, operator not a looking we're If some could though long-term So a have a looking a to of we big gain. good it's we they the for to even get that premium we're are good assets we have lease, have. just good monetize

space keep of -- and necessarily that in then operators, they're Okay. operators or are the up, some assessment are number maybe breaching How a just you -- about existing having across re-underwriting your of throughout leases list obviously their a having stable difficulty stable the industry your And the what facility-level portfolio cropping you the not operators the on as themselves? on basis. existing around but -- themselves,

any currently under of that the of discussion in the in discussions having not any re-underwriting leases of We're industry. are the operators

of you think or by We are going the that bankruptcies. they're are which talking of to we've assets we older in know their we are end considering care, Relative it hope supportive through and couple I that. preferred to year. of selling, hope past they to their that completed have still that in the the about have portfolio to a Genesis, completed they And discussed

So that we're re-underwriting asset.

the the that entire or we're are our So have with of operators assets portfolio looking within investment other no there assets multiple pruning pruning them. that at any

know of there basis, bit quite there more a sequential decline? any obviously, cause concern? basis, the on then And maybe EBITDAR within Okay. one seeing a a decline coverage the on you bit. operators mean operators for side be on the are the But coverage to more rent at the but a I little an other else SNF looking just EBITDARM flagged, bit there's significant are parsing causing and the that I'm little portfolio. individual SNF deferred to, as I offering anybody that's Thrive an

the don't reasons skilled that is monitoring. why a specific It but have side portfolios we the obviously Thrive concern. Well, -- different right on now we there's private obviously seem in side, pay different decline. have on We're or does

coverage seen what's that's But have to on operator-specific. us; isolated isolated It's in and hopefully it's some We industry. our not positives upticks others some in common in happening this. we I mean are to the not -- that among portfolio decline, the seeing

probably distraction our But to but we're there's corporate-level actions on it So are something at is one on work help and monitoring building. those I some positioning is operators and with looking certain we continuing them. the on it concern portfolio. implication assets the think said, could taken have attention other, certain we're in some about and pair have actively focus we're make with specific don't just Wendy's to over what And to within can them from that as where portfolios comment would their improvements understanding discussions be able that

So that's asset our process. of part management

relative through New And rate investments that the have the increase has XX months Mexico, not with trailing of to that Genesis in activity. is and come of so majority we the

the significant a in Genesis. increase So that's coverage for

that to our that same-store in clarify we in assets our is gave Jordan -- are want lease-up, in just are supplemental. so not they I Thrive their in for included metrics

your deferred think And if were rent. mentioned offering else there anybody prepared there kind just I will? just that was I on -- if that you of curious remarks list, some you out because And Right. them I that was in was you as threw them worry

that. other that was talking concerns talking There as on as good see. that about companies we've challenges Thrive well about we been been about and We've Anthem,

to light mean I bring we'll these we see discussions. those, as those So in

maybe in service wanted coverage? debt to coverage the it, the EBITDAR Okay. at what's And cut

portfolio For or… a specific

was -- side? I on SNF Yes, no, the

of Because Michigan? our with mortgages

in SNF coverage. included the They're

a it charge is like that's That's coverage? fixed chart -- a fixed more included

interest with both principle the include those We associated Correct. And included those. applied small a in are with loans, there's associated -- payment those plus and expense

rent. were it if As

As yes. were if it rent,

Okay, thanks guys.

Jordan. you, Thank

The ahead. next go question comes Please with Stifel. Vanacore Chad from

Hi, good morning.

morning. Good

parts memory care two little so a Are you us having is portfolio right, in are tell care All occupancy? while bit in you're about your more buying of memory Can new And the why care properties? stabilized, trouble they where Texas. leasing up? other more memory by the they

have specifically, the mentioned free market. them through The Worth these still we And to and been We our Sure. with we we're lease-up in some stage. in them credit enhancements itself, they of rent a that we been in provided And has been years. phase, And it This we with rent some are There Kelsh this. acquired that for acquisition is engaged why lease-up properties price. part softness some [ph], $XXX,XXX assist that in with market. has presented relationship an Dallas-Fort we factored feel we our that's a a acquiring and are assessment. number of bed free for that associated have the it's -- that this underwriting as opportunity

it's LTC. bring will good future relationship to and So that good opportunity growth we think a a

some of and as seen And everybody soft demographics the that I -- so will Also, established better. is about a assets think, our fact a who think, are just so and talking development the little lease-up not operator, is Kelsh seeing, significantly, lease-up. new long is more a little newer it's make, we're like a more I down operators little

we Kelsh who of acquisition, operator a didn't but have lot have in wouldn't new had the operation. So been track brand a record that we confidence if do it probably a great

them. balance strong a sheet behind And

strong. very Yes,

question. this in the one modeling then quick do straight What All was bad with know, per sales. on on low, to pretty from elevated right, line line Sunrise And here right thanks. the Straight Presumably quarter just was then quarter and out? has off that. expected is you

to that back for want rent. the rents our where me at straight four XX down the or of right, up non-cash forth that to you're of straight page? quarter, you deferred component you bottom, of just go projected next quarters this go Yes, give and want on Do But line. at there page quarter Thrive, went the we the through pre-rent but it's for Kelsh is, line revenue supplemental, projection to next due look to the

I'll out, check thanks. Pam, it

call Okay. it, Yes, purposes. questions it's think but pretty for your have on detailed me if you any modeling well-laid I out

Securities. next Mizuhi comes from go The question ahead. with Anderson Please, Rich

Mizuho, enough. but close

So, it that want and skill the of would on call coverage, be for it you us out give you can quasi the what to you coverage, guess, if the the I took overall equation portfolio? Prestige

so… coverage haven't We given operators, specific for

out not the norm. they're of But

correct. Yes,

X So like X.XX. it's else not and they're at is at everybody

XX? at they Are

XX? XX Are they between and

Prestige Let's maybe much? you you kind of change say you and really put would it coverage in but would way, this it's do and kind distorting it feel you -- say so taking or wouldn't said this, the of is overall just like skilled out the range

That is correct.

but your into Okay. previous the And the I I'm raised was you to a account -- I guidance, take me surprised for Sunrise guidance? in was it, guidance, remind guess, little then sale turning question, dispositions when first you happy

Yes, it was.

but perhaps happen to more you have the go. million No $XX the in dispositions will quarter. just still third mentioned that you acquisitions, But Okay. that

So some your what have guidance? dilutive those impact on normally offset forces that of were a would that the dispositions

are and impact. or an that much the the later at they the the is acquisition what reminder looking we're them have seeing scheduled we and that you're dispositions disclosed. Mostly anticipating in of acquisition have we're year, increase Field The from Kelsh they year, the don't

the you it lines, but done. if in is right those along on I guidance I specifically, how potential uplift curious us pipeline was don't -- -- more mentioned way not there just it's then new And now, but give you see to any what in from are of Okay. color deals could getting your guidance know know active

to as we intent actively of know pursued sort or closing. guidance have calls, base. Rich, under on of pipeline letter earnings our And our things transactions of that we've year given this to our Those take more which active an you off discussions come likelihood we've longer fruition. market pursuing True. as are by

activity. we're So seeing

actually be and for find few interesting seeing point from are transactions a may We we a marketed us. price more feasible that

So of to transaction we're up point more on at opportunities. our opportunities this in deals those of has that a been general guidance at intent. focused But letters haven't pipeline just see we with seeing we're really looking few more we where process are. and And volume the more trying signed more having are and on evaluating

where So engaged transactions sourcing I right we're is actively we're now. at

you're CMS your positive of looking mentioned business. and and of it market frame, And could Okay. you senior -- skilled sort news perhaps skilled is the at what of proportion at Has of on? increase basket all sort a from you what then question, give balance what last a pipeline proportion hitting that good it the some you sentiment of know, it with housing, so altered nursing perspective or -- is is

date, space on to couldn't you grow the but opportunities the skilled an space. assets. just skilled found been and focused supporter percentage, we right on right we side. finding sourcing but we the really a at a companies We're I supporter and haven't with skilled operator, looking opportunities opportunities on the the actively which are we've right and of in to and looking give those Right continue right to markets, be the exact regional those grow to for

Okay.

thanks good, very Sounds much.

Thank you.

Rich. Thanks,

RBC ahead. The question Please, Capital Carroll with Michael next Markets. go from comes

development completed job the Yes, looks pipeline in a project. have you up thanks. It like guys done lease-up pretty leasing the

rent they surprised looks of like compared progress Thrive. at It made that first quarter. that too good pretty kind the I'm deferral So the to

it tenant with on expectations? So what's your and that missing is why going

that of little you've it's have been seen stall some There's And we've buildings you -- on last couple softness couple in monitoring something in get earnings next some know, country calls. market in and softness a lease-up. that the just them like need the them of different to the of the of a with through on the saw we've experienced period as And help this. we general in been mentioned this brief they parts

that of different They say than, LTC outside from So of the investments have the equity in relationship. are Anthem, lot just is ownership there organizations other other perspective, have a thing they for positions buildings. a

So rent gave that them we deferred feel on we this.

we we expect to paid pay be So deferred rent feel giving And capability to the the we're them. on have the back they -- and that rent back. to go ahead

gap really So it's just a bridging them. for short-term

on up? then us And give been how couple holding a you details can I I projects. a the is little know moving Okay. onto there's more Have bit the those Anthem, that guess, occupancy and Has of the occupancy that's you for. stopped the that you the no projects provide put that to increased providing lease-up, were projects it? why completed lease-up longer level XX% back into completed

certain -- -- far we flat mean, occupancy provided the they As not on as numbers, were no, not it's specific I ones. providing

they've on tried building definitely they've we've more portfolios building. progress where aggregate at basis to the on Marietta to holistic and lease-up. to So made at a for that some so We've aggregate seen the to continued positives they're try

they've time. got I think of been only traction Oaklawn is at a short for positive open the they've period given

your expectations or think like question of assets, that? the should then for occupancy we just on how that the meeting And Okay. it Frontier the there holding has from flat kind looks a past been few quarters. last about me Is

on community. place they've with that some had And Frontier, corporate leadership in We level building. they new that have at are a focus engaged

they're we but have I like our So engagement than improvements community. they appropriate we the make definitely better competitive regional making see to corporate to I think a at And market, mean -- perform it's would some to through the it changes them operations, focus with it are is. address the

great, thanks. Okay, Thanks, Clint.

you. Thank

question Daniel comes Capital next go Bernstein with ahead. Please, from One. The

here. taking for you my thank Hi, questions

Hi, Dan.

Yes, coverages your are sell assets that included supplemental the we reported coverage as and coverages so you at numbers improvement around or those some are selling, in and about those are you're those lease should present in in your think that you the on potential for or lease coverage assets. lease

There included we in are provide our They relationships. coverage small are in the that supplemental.

on very wouldn't I the So needle move expect portfolio. the much to that

then And JVs doing Okay. of significant you've been number lately. a

net not well. some had to discuss some maybe triple joint that do You've peers anymore going and more ventures they're do as

it's go more the able is that's triple much net and JVs? to the operator going do -- it forward to that ahead something is your just become going ventures more movement towards more desires joint do So leases something and troublesome be pushed to as standpoint want or -- you to that's from been by operators a given it's

situational. just Dan, do Kelsh, I to Obviously think -- opportunities it's sale we really a still did sale there're transactions. that's leaseback still with so leaseback

them flexibility an approach view their really and us able we solutions it being us, For provide does meets gives really opportunity for it needs. in that as to relationships and different of types

have ventures, and spent we been couple with at time. years something joint this of on engaged the actively So we looking is

has joint a sale net The a lease venture has triple lease involved in it. --

So it's…

of component joint a the venture. It's

joint the venture. of component a It's

to -- to us good portion and and have venture. be us venture for a co-invest really the and it joint really and have to we the conversations So just has with conversations paid opportunity, leads it's the that's joint really rent with. otherwise But not reduces through operators, effectively the basically able it might that Opco

companies people really and So doors haven't way a business with done and is to talk we open with. it

operators with experience have all had bad the triple a lease. net Not

they the and coverage have when lease purchased, for did at level sold what then payment, the they set look to and asset was increases. go back You and the what got set and set the

rational period, then the during operators hampered. valued rate had So the and been if has unusually you a conservatively not

the it have over-levered triple say, and… fact the people that is So lease you dead dead, if net is

Monetized.

-- over-monetized.

So were and going happen. yes, happen, they did those to

financing, everybody can And is way thinking my opinion. the of nobody make net That's and is money. triple so, an now any that lease evil

it second-half supposed of Okay. said that want to on rent was kind were the year, too. on Well you. of next that Anthem beyond I question but to not continue take dispute terms talk And a we Anthem, there quarters? more couple the -- in bit, what up of the maybe the to that can about of going you in just sounds little expect rent from think like one some in I'm in maybe and track I ramp just --

disclosed expecting right. the year rent are have track will setting fourth X.X -- the as which that that we we goes then that, be in of And really X.X. and on quarter, prior discuss you third later we had they will and you in that it a we with them with for quarter on Dan, well. million that in are year, to the done up for meeting once which XXXX We

That's hop I I all off. Thank Okay. have. you. will

Dan. Thanks,

The comes with Wells ahead. Todd next from Stender question go Please Fargo.

Hi, thanks.

Just wanted the to to to referring X.XX the laid is rent first get years, it cash the schedule transaction, does over back ramp yield. the time? initial how to how out, Just two Kelsh go to you see

use on Sure. The pre-rent cash flow them depending to operation. is available the component for of

So it it and "Free there Again which really a to portion added into performance they paid. so would what lease be that space the in upon want gets to is dry rent," rent clause gets down. subject buildings to that, the

long-term or borrow they on the extent use the it increase does the rent to portfolio. those So funds,

XXX,XXX like first the the form did until any that's haven't -- cash considered XXX,XXX rents we used. pro But

correct. Yes,

That's pro forma how we did.

Correct.

net cost associated Okay. But lease. with the paying all that? triple still a it's They're

Correct.

Yes, okay.

is That correct.

require? living, other you the occupancies, living; into to about have you to the partnership but rental Oregon the are are so develop then And how facility, talked fundamentals you fundamentals you the have IO going independent that purchase assisted with the got about the any to go rates, committed

living was probably The about close care assisted of would XXXX, born it building. IO of property. IO and are that not the occupancy, a regarding have and memory the is fields The development putting is IOs since XX% times communities. X.XX Fields out the on stabilized to really coverage probably to about talking -- --

That's you. Great. thank I had, all

Great, thank you.

Thank you.

comes with Your next Karin [Operator Ford MUFG Securities. Instructions] question from

to rethink that question. that Or, morning. in the triple historically have of earlier all? the just you we preference and owners, are cycle at on I follow-up in continuing [indiscernible] good are know have Hi, to operators camp? net wanted started firmly given I where Dan's been the guys use still structure, you but to you

net triple the in firmly camp. We're

question is sale And you leaning you'll said that Okay, re-lease end the expecting? us in just towards what relative that's coming at the update And those? or properties on probably how two California simple. of on towards us are more solution Can on bids tell you the just pricing August. on the the are next that the you is you in

that engaged process we community options. We're for process. are actively run to And in in both

here be us way to the would about on. I it don't we which public in of discussion a So, going that prudent forum think would have

soon We transaction. affords are fairly best and hope what made both that that. the that have we to of LTC lease at sale on do the out decision looking and opportunity And

triple the to Okay. right the And you then mentioned having a stabilized terms right me you last triple one portfolio? in net for under from call that lease lease. your going add your mind is What's to net escalator a are it

most the make is range X% in yields would it if probably an escalator. lease annual for sense A

you've baked what that is Texas into the acquisition? And

Yes.

you. thank Okay,

you. Thank

Thank, Karin.

The Rich a with Anderson follow-up next is Mizuho from Securities.

Thanks.

just recalling was it call I deal I -- then. I -- back I higher was to actually my recalling the prestige did went back back thought in times I when and go it you XXXX, was two So to kind question. coverage. looked coverage back wanted in And when

since can the roadmap in today? call that two some Now I from then. But you -- believe on your said is to times gets know moving provide you you your it I which there parts that have where been

two historical That to us times would million… I good coverage the was prior providing say $XX note. additional that

Earn out.

transaction that we of to committed another we replace buildings. $XX two $XX there on addition, CapEx transaction. that committed out in And that funding million …earn million initially on in plus was

one incremental the So had fundings multiple dollars… on there funding And side that's building lot come on. process, there's that in was of to prior so that was replacement still the of

Okay, okay.

glitches So they they do operations. activities these generally while some in have

lower sort remember of Right, mean including those with is understood much that all want because all place parts moving -- I some moving events. I parts. right. of the the then just is I make sure I them those two now of to

Yes.

Okay, you. thank

Thanks. Sorry.

Thanks.

you. Thank

a Capital next The go follow-up One. Please Bernstein question is Daniel from with ahead.

looks were know triple emphatic for very it to thanks I follow-up that doing the transaction said you you in second you question. quarter. to right this like will lease a net, No taking the -- switch did more here. I very development was bit Karin's so -- Karin Hi, are little

So has terms in your as senior housing do trough of maybe of development much how to view want changed in you kind hit the we for fundamentals?

we of are benefit cost No, broad general, always where a because to is based much a I that's there in benefit on unique a building is. that's general in cost And specific of the in land, But always going cycle going there's And here markets. labor, market the going think seeing component. are what focused. today's opportunities -- be a not smaller been to the material [indiscernible] equation to I where think development really market run. But up. is there's as is be in opportunities. will I we mean certain of compared And

a I it. the in we have But anywhere near So think past. done do of to small probably amount we it's be going not what

think -- right I we We any we? not don't are we some -- have a development working point, are now, are don't at development.

than the three Other have. we

we announced. anybody have we development. not talking are Yes, to Yes, about

for Okay, Thank enough me. you. good

Thank Dan. you,

Thank you.

like over question-and-answer to would closing our Simpson turn back Wendy the I remarks. session. to concludes any now This for conference

of a time you you, thank Thank hopefully day. lot you We great Again and have third have we listen and the to forward after to look for will talk to our interesting about. spending comments. to to talking a things all more quarter,

now conference Thank concluded. for has This attending you presentation. today's

You may now disconnect.