NHI Execs Eye $100M in Deals, Call for a ‘Compromise’ On Nursing Home Staffing Mandate Amid Labor Shortages

Executives for National Health Investors, Inc. (NYSE: NHI) said Tuesday that they are starting to see more deal activity and an increased volume of new inquiries in the last several months. 

“We’re looking at opportunities across the continuum of senior housing and skilled nursing, and across multiple products including loan, lease, and joint venture opportunities,” Chief Investment Officer Kevin Pascoe said during the company’s first quarter earnings call. “We currently have submitted LOIs on deals valued at more than $100 million, with yields of more than 8% on average.

Though most opportunities are primarily senior housing focused, there were some updates to the skilled nursing portfolio.


“We had another strong quarter with positive year-over-year adjusted NOI growth in the need-driven and discretionary senior housing operators, skilled nursing, specialty hospital, and the SHOP portfolio,” CEO Eric Mendelsohn said. “The need-driven operators again had positive coverage trends with EBITDA at 1.35 times, representing the eighth straight period of sequential growth.”

Executives reported that rental income for the three months ending March 31, 2024, incorporates a write-off of approximately $0.8 million in straight-line rent receivable, linked to the anticipated termination of an existing lease and the re-tenanting of a skilled nursing facility.

Despite seasonal pressures, average occupancy for NHI in the first quarter increased by “a strong” 2.1%, rising year-over-year by 10.1%to 85.3%, BMO analysts noted.


During the call, an industry stakeholder asked NHI executives about their thoughts on a letter from Democratic legislators to three of the nation’s largest publicly traded for-profit nursing home companies. The letter called out their “hypocrisy” for criticizing the proposed staffing mandate.

“(We) seek an explanation for the discrepancy between (your organization’s) massive payouts in executive salaries, stock buybacks and dividends, and the nursing home industry’s simultaneous opposition — based on claims that they are too expensive — to new rules to increase staffing and protect nursing home residents. These two competing claims do not add up,” wrote the lawmakers. “(The) nursing home industry diverts hundreds of millions of dollars in cash away from nursing home staff and patient care, and into the pockets of company executives and shareholders.”

Responding to the letter, Pascoe validated the motivation behind the lawmakers’ inquiry, but also said he understood why his skilled nursing partners were pushing back against such views and the blanket implementation of minimum staffing requirements.

“I think there is probably a thoughtful approach to delivering care when we look at our portfolio, particularly the star ratings, which are pretty good and stack up well against others,” Pascoe said. “I believe that our operating partners are delivering good care in their buildings. I think there’s probably a more thoughtful way to do it than just applying aggregate hours and saying that’s what it should be for everybody.”

The biggest issue NHI has is the ability to get labor, he continued, especially when it comes to available RNs.

“We see this in our markets where we’re down and affected because hospitals get first pick, then skilled nursing facilities scramble to find nurses, and it even impacts senior housing where they struggle to retain nurses because they’re simply not available,” he said. “It doesn’t matter how much you pay them; they don’t have people to stay with. So again, I think there’s a more thoughtful approach that’s likely out there. I’d like to think that there can be a compromise, and it seems like there’s going to be more work to be done on this.”

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