Brookdale Senior Living (NYSE: BKD) is touting recent moves and operating improvements as proof that its board and management team are “realizing the company’s full potential.”

The Brentwood, Tennessee-based company is improving its operating performance, optimizing its real estate portfolio and reinvesting capital into its communities, according to a May 15 letter to its shareholders.

Earlier this year, activist investor Ortelius Advisors nominated six new members to Brookdale’s board and called for sweeping changes in response to what it sees as “abysmal performance and chronic undervaluation” on the part of the operator.

Brookdale management said the company has made significant improvements to operations so far in 2025, including that it is in the midst of a CEO transition, increased its guidance for adjusted EBITDA and RevPAR in 2025 and has appointed two new independent directors, bringing the average tenure of the board to fewer than four years. It is urging investors to vote for the company’s eight nominees at its annual stockholder meeting in July.

“Over the past several years, we streamlined operations, simplified the business, rationalized our lease portfolio and reduced leverage,” the letter from Brookdale reads. “As evidenced by our first quarter 2025 results, including an increase in our same community weighted average occupancy rate to 80 percent, Brookdale now stands at a meaningful inflection point and is well-positioned to capitalize on robust demographic and industry tailwinds and to deliver compelling and sustainable shareholder returns.”

Brookdale management pointed to the fact that consolidated revenue per available room (RevPAR) was 18% higher and operating income per available unit was 8% higher in 2024 compared to 2019.

Brookdale pointed to the fact that it had positive free cash flow in the first quarter of 2025, that its same-community portfolio average occupancy registered at 80% and that its RevPAR growth of 4.9% compared with 2019 exceeded internal expectations as proof it was on the right path. The company’s 90-basis-point gain in operating income margin versus 1Q25 also represented “the highest same community operating income margin achievement in five years.”

Brookdale also noted five initiatives that show it is “committed to building on the progress we have made.”

The company has taken a “SWAT team” approach to improving operations by deploying specialized teams at a number of communities throughout the country in a bid to improve operating performance. The company also laid out plans to further optimize its real estate portfolio by exiting another 55 leased communities alongside divesting 14 “non-core” owned communities. The operator invested $5 million late last year, and it plans to invest an additional $10 million this year in order to keep communities competitive.

It is also reducing leverage by refinancing debt and applying a portion of asset sale proceeds toward debt reduction. Brookdale also sees development programs, career advancement pathways and its “mission-driven culture” as helping to build high-quality experiences for residents and staff.

It is also pursuing its pre-pandemic average occupancy of 84.5%, which it said will generate $170 million of incremental revenue and $125 million of incremental operating income without substantially increasing labor costs.

“The board’s commitment to good governance extends beyond board refreshment as most recently evidenced by its decision to review governance enhancements related to director tenure, as well as to evaluate its performance-based long-term incentive awards program for executives, in response to feedback from shareholders,” the letter states.

Brookdale has raised its annual guidance for both RevPAR and adjusted EBITDA to 5% to 5.75% and $440 million to $450 million respectively.

The operator has positioned its board as an “agent of change” for the future, as the board recognizes that “further change is needed,” the company said.

Brookdale also in the letter called into question Ortelius’ “real motives,” noting that the management team “made many attempts to engage with Ortelius constructively” but ran into “reluctance and delay in forthright engagement.”