Welltower Reports Robust First Quarter as Execs Remain Cautious But Optimistic

Welltower Inc. (NYSE: WELL) reported a robust start to the year, noting a nearly 19% year-over-year growth in FFO per share across all segments. Particularly noteworthy was the impressive performance of the senior housing business, surpassing expectations despite economic uncertainties and turbulence in commercial real estate sectors.

Shankh Mitra, Welltower’s chief executive officer said that despite economic uncertainty and turbulence in commercial real estate, the demand-supply dynamics in senior housing are steadily improving, with Welltower experiencing strong performance in the first quarter of 2024. The company achieved double-digit same-store revenue growth of 10.3%, driven by robust occupancy and rate growth.

This success translated into significant margin expansion and a 25.5% growth in same-store net operating income, marking one of the strongest quarters in Welltower’s history, he said.


Welltower is actively pursuing acquisitions and capital deployment opportunities, leveraging data science to identify assets with strong growth potential, he said.

“We occasionally come across sellers who are disconnected from asset values, as they appear to be living in a time capsule of yesterday’s interest environment or simply hoping that we’ll be back there soon,” he said. “Many more pragmatic and smart institutions and families realize that perhaps hope is not a strategy, especially in the face of a looming wall of debt maturity for the industry and data financing options.”

Welltower reported earnings per share of $1.01. This was above the analyst estimate of 94 cents. The company reported revenue of $1.56 billion.


Midday, Welltower shares traded at $96.71, up 93 cents, or 0.97%.

Financial results included a normalized FFO growth of 18.8% year-over-year and a decrease in net debt to adjusted EBITDA ratio to four times, according to Chief Financial Officer Tim McHugh.

When asked about underwriting skilled nursing investments — and the range of EBITDAR reductions that Welltower may be contemplating that account for the staffing mandate — Nikhil Chaudhri, chief investment officer, said skilled investments won’t be too consequential.

“Skilled businesses are essentially structured credit, short-duration providers of capital…” he said. “So, you know, at the level we operate, it doesn’t really have a meaningful impact, given the downside protection we have.”

And though the quarter was strong, Welltower executives said they are still “looking over [their] shoulder to think about what can go wrong.”“The law of numbers, they are unforgiving, right? … We haven’t made any money over the last 10 years as an industry. So, while year-over-year numbers are impressive [but] understand the basic numbers just to go back to where we started as an industry.”

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