National Health Investors (NYSE: NHI) is deferring more rent from Bickford Senior Living.
Among NHI’s other largest operators, Holiday Retirement continued to see occupancy decline between January and February, but Senior Living Communities gained census for the second straight month, the Murfreesboro, Tennessee-based real estate investment trust (REIT) announced Monday.
NHI agreed to defer $3 million in rent due this month from Bickford. This brings the total deferred rent from the Olathe, Kansas operator in the first quarter of 2021 to $3.75 million.
The rent is expected to be repaid with interest.
Previously, NHI deferred $3.75 million in rent from Bickford in the fourth quarter of 2020, and $5.85 million for the full calendar year.
The operator, which manages 47 communities owned by the REIT, has struggled with occupancy over the past 12 months, as a result of Covid-19.
Total occupancy across NHI’s Bickford portfolio fell from 84.7% in March 2020 to 75% last month. Occupancy fell precipitously since November 2020, dovetailing with a third wave of positive Covid-19 cases across the U.S.
But the pace of occupancy decline slowed slightly from January to February — 60 basis points, compared to 90 basis points from December 2020 to January.
Overall rent collections are also down slightly in the first quarter of 2021. So far, NHI has collected 93.6% of contractual cash due, compared to 93.9% the previous quarter. The lion’s share of the balance — 4.6% — are Bickford deferrals. Through March 15, NHI collected 86.5% of contractual cash due. The newly announced Bickford deferrals account for 11% of the remaining balance.
During NHI’s Q4 2020 earnings call last month, CEO Eric Mendelsohn expressed optimism that an occupancy rebound was in sight, citing positive trends in sales leads and vaccination rates, as well as a dropoff in positive Covid-19 cases across the REIT’s total portfolio of 162 senior housing and 75 skilled nursing facilities.
Bickford accounts for 15% of NHI’s annualized cash revenue. The previous rent deferrals carry an 8% interest rate, with repayments scheduled over a 12-month period starting in June.
NHI’s senior housing portfolio shows a varying performance among its three primary operators: Bickford, Holiday Retirement Communities and SLC. Holiday, which accounts for 11% of annualized cash revenue, saw a 1.7% decrease in average occupancy from January to February, to 73.6%.
SLC, which accounts for 15% of annualized cash revenue, reported occupancy gains from December 2020 to January, and from January to February, totaling 180 basis points, to 78.1%.
“[Sequential] occupancy increased 80 basis points [from January to February] with only 240 basis points of lost occupancy from Covid-19,” BMO Capital Markets analysts Juan Sanabria and John Kim wrote in a note to investors.
Charlotte, North Carolina-based SLC specializes in continuing care retirement communities (CCRCs). CCRCs generally outperformed industry averages on occupancy during Q4 2020.
NHI did not respond to a request for comment from Senior Housing News.