LTC Properties Inc. (NYSE:LTC) Q2 2018 Earnings Conference Call - Final Transcript

Aug 09, 2018 • 11:00 am ET


LTC Properties Inc. (NYSE:LTC) Q2 2018 Earnings Conference Call - Final Transcript


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Good morning, and welcome to the LTC Properties Second Quarter 2018 Analyst and Investor Call. (Operator Instructions).

(Forward-Looking Cautionary Statements)

Please note this event is being recorded. I would now like to turn the conference over to Wendy Simpson. Ms. Simpson, please go ahead.

Wendy Simpson

Thank you, operator, and welcome, everybody, to LTC's 2018 Second Quarter Investor Call. Joining me today are Pam Kessler, our CFO, and Clint Malin, our Chief Investment Officer.

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

We have been laser-focused on evaluating and strengthening our portfolio, positioning LTC for continued, long-term success. Importantly, by listening closely to our operators, we offer creative financing solutions that go beyond traditional sale-leaseback, including real estate joint ventures, preferred equity and mezzanine lending to meet operators' various goals, strategies and needs.

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

We believe that in the current market, it remains prudent to continue selectively identifying opportunities to sell assets and recycle the capital into new investments. Most properties that we are selling or contemplating selling are older. Some may be non-core to us or our partners, and yet others may be driven by a tenant who wants to buy the property back. While there are many reasons an asset sale could make sense, we will only proceed if it is strategically and financially advantageous to LTC. Clint will offer more color later on the call.

Now I'll provide an update on a couple of our current operators. We remain pleased with Anthem's ability to pay higher rent in line with our expectations but continue to work closely with them to ensure they achieve the goals they committed to for 2018. Occupancy at Anthem's Murrieta community increased to 88% at July 31, up from 71% at April 30. While the communities in Burr Ridge, Tinley Park and Glenview were roughly flat, Oak Lawn, which began admitting residents in late May, was 20% occupied at July 31.

Moving on to Thrive. We have been closely monitoring their operations and progress. We just recently signed a lease amendment to provide Thrive with support in the form of up to $1.4 million of deferred rent through June 30, 2019, as they work through continued lease-up softness. On an aggregate basis, occupancy was flat across our Thrive portfolio at