Q1 2026 Earnings Call Transcript

Thank you for standing by. My name is Bailey, and I will be your conference operator today. At this time, I would like to welcome everyone to the Ventas, Inc. First Quarter 2026 Earnings Call.

All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star and one.

I will now like to turn the call over to Bill Grant, Senior Vice President of Investor Relations. You may begin.

Thank you, Bailey. Good morning, everyone, and welcome to the Ventas, Inc. First Quarter 2026 Results Conference Call. Yesterday, we issued our first quarter 2026 earnings release, presentation materials, and supplemental information package, which are available on the Ventas, Inc. website at ir.ventasreit.com.

As a reminder, remarks today may include forward-looking statements and other matters. Forward-looking statements are subject to risks and uncertainties contemplated in such statements. A variety of factors may cause actual results to differ materially from those. For a more detailed discussion of those factors, please refer to our earnings release for this quarter and to our most recent SEC filings, all of which are available on the Ventas, Inc. website.

Certain non-GAAP financial measures will also be discussed on this call, and for a reconciliation of these measures to the most closely comparable GAAP measures, please refer to our supplemental information package posted on the Investor Relations website. And with that, I will turn the call over to Debra A. Cafaro, Chairman and CEO of Ventas, Inc.

Thank you, BJ, and good morning to all of our shareholders and other participants. I want to welcome you to the Ventas, Inc. first quarter 2026 earnings call. Ventas, Inc. continues to drive growth and outperformance as a leading participant in the longevity economy. We are already into our fifth consecutive year of double-digit annual growth in our senior housing operating portfolio, or SHOP.

Even more exciting, this year represents a new and positive inflection point when demographic demand jumps and growth remains elevated for over a decade. Our business and team have been built to meet this moment and seize the unprecedented opportunity for multiyear growth and value creation. With SHOP as our engine, Ventas, Inc. is now a $6 billion S&P 500 company with a portfolio of over 1,400 properties serving a large and growing aging population. We have developed a unique brand that stands for delivering for stakeholders and winning together.

Our excellent first quarter results and improved full-year outlook demonstrate our competitive advantages, the impact of our differentiated platform, strong execution of our one-two-three strategy, and our momentum. In the quarter, Ventas, Inc. delivered 9% year-over-year growth in total same-store property NOI and normalized FFO per share. SHOP NOI grew over 15%, and U.S. occupancy increased 370 basis points, fueled by broad-based demand and our Ventas OI initiative. Accretion from senior housing investment activity further contributed to our growth in the quarter, showing our strategy in action.

And notably, our liquidity reached record levels and our financial position continued to strengthen. Based on our first quarter results and our confidence, we have improved our outlook for the full year, increasing our mid guidance for FFO per share by $0.03 to $3.86 per share, led by SHOP same-store growth of 16%. As a result of our strategy and execution, we have already grown senior housing to over 60% of our business, and our communities now serve nearly 100 residents. In a large and highly fragmented sector where most operators run 10 or fewer communities, our platform gives us unique advantages to drive outperformance at scale through data and experiential insights.

With our collaborative approach, Ventas OI also attracts many experienced operators who want to manage our communities and benefit from Ventas, Inc.’s aligned approach, people, and platform. And we are just getting started. In the investment market for SHOP, we have an outstanding private-to-public arbitrage opportunity. We have already closed $1.7 billion of attractive senior housing investments this year and over $6 billion since 2024. Our number one capital allocation priority remains U.S.

SHOP communities that meet our strategic framework and can deliver unlevered IRRs in the double-digit to mid-teens range at pricing below replacement cost. Interestingly, because there is significant existing and new investor interest in senior housing, for all the obvious reasons, we are seeing more owners and potential sellers bringing assets to market and engaging in conversations with us about transacting. This trend is expanding our pipeline significantly. We are confident in our ability to capture more than our fair share of desirable deals because of our momentum in the market and our competitive moats.

We have now increased our 2026 investment volume guidance to $3 billion. We are focused on increasing our SHOP business organically and externally to drive our forward enterprise growth rate and serve the nearly 70 million baby boomers who start turning 80 in 2026. In the next five years alone, this group will grow nearly 30%. Yet, in the first quarter, senior housing construction starts totaled only about 1,500 new units, and total senior housing communities under construction remained at historic lows. With at least a three-year start-to-finish development cycle, these favorable demand-supply trends provide our advantaged platform with compelling and durable tailwinds.

The Ventas, Inc. team is unified and enthusiastic about outperforming at scale and the multiyear growth and value creation opportunity ahead. We are excited about our improved outlook for 2026 and the setup for the coming years as we pursue our mission to help people live longer, healthier, and happier lives. With our unique brand standing for commitment to each other and our stakeholders, we are in it to win it together. In closing, I want to recognize our admired colleague, Pete Bulgarelli.

Pete is retiring after an extraordinary four-decade career in commercial real estate and eight years leading our OMAR business with excellence and integrity. On behalf of all of us at Ventas, Inc., I thank Pete, and wish him every continued success and happiness. With that, I am pleased to turn the call over to Justin. Thank you, Debbie.

I am pleased to join you today to discuss another strong quarter of execution in senior housing, reflecting continued momentum across both organic performance and external growth in our SHOP portfolio. I will start with SHOP performance, then provide updates on our active asset management and the full-year outlook, and conclude with investments and capital deployment. Starting with SHOP, the first quarter results reflect both strong market fundamentals and sharp execution across the portfolio. In the first quarter, SHOP same-store NOI increased over 15% year over year, kicking off our fifth consecutive year of double-digit NOI growth.

This is driven by a powerful combination of occupancy growth, pricing strength, and operating leverage, and increasingly supported by the Ventas OI initiatives we are deploying with our operators. Occupancy continues to be the primary driver of performance. Same-store average occupancy increased 310 basis points year over year, reaching 90.4%. Performance this quarter was particularly broad based, with so many operators contributing to our success there are too many to name.

The results in the U.S. portfolio were especially strong, where same-store occupancy increased 370 basis points year over year and outperformed the NIC top 99 markets by 150 basis points. On pricing, RevPOR increased 5% year over year, reflecting strong in-house rate increases that are running at nearly 8%, as well as continued improvement in street rates across geographies, operators, and product types. Operating expenses increased 5.8% year over year, which was largely driven by higher occupancy levels and winter storm-related costs. Net-net, NOI grew over 15% year over year, and we delivered meaningful operating leverage, with NOI margins expanding 170 basis points year over year to 30% and incremental margins at 50%.

As we continue to deploy our active asset management, we are executing in close partnership with our best-in-class operators and with a talented and recently expanded Ventas SHOP team that is driving performance at the unit, community, and portfolio level. Across the portfolio, we are focused on community-level execution alongside our operating partners, supported by the continued evolution of Ventas OI. We are deploying targeted initiatives, including refresh CapEx, price-volume optimization guidance, and a sharp focus on sales culture, with the ultimate goal of achieving zero lost revenue days in our highly occupied communities.

We are also implementing unit-level sales strategies supported by boots-on-the-ground site visits from our team. And we are doing it in collaboration with operators, delivering strong revenue and NOI growth while ensuring the senior living value proposition is realized for residents and families through the care, services, and peace of mind provided in our communities. This combination of active asset management and structural demand tailwinds has led us to increase our 2026 SHOP outlook, including same-store NOI growth of 16% at the midpoint, up from 15%. This is driven by a higher expectation of occupancy growth of approximately 300 basis points, which is leading to increased revenue growth expectations of approximately 8.75%.

As we have discussed previously, the key selling season runs from May through September. While we enter the season in a favorable position because of the first quarter strength, our success during the key selling season will determine the full-year outcome. Looking ahead, there is real momentum building for us to expand on several key fronts. Over recent years, we have made intentional strategic moves to ensure Ventas, Inc. stands ready to harness the growing surge in senior housing demand.

Because of those efforts, we are confident that we will continue to drive solid organic growth fueled by ongoing increases in occupancy and the operating leverage we are achieving across the SHOP portfolio. And with our U.S. communities averaging about 87% occupancy, there is still significant runway for us to continue to drive outperformance. Importantly, the strength we are seeing in SHOP performance gives us confidence to continue leaning into external growth. Turning to investments, 2026 is off to an excellent start as we execute our external growth strategy with focus and intention.

Year to date, we have completed $1.7 billion of high-quality senior housing acquisitions in the U.S., building on the fast start we saw in January. On this activity and our outlook for the remainder of the year, we are increasing our senior housing-focused investment guidance from $2.5 billion to $3 billion for 2026. While there is heightened interest in senior housing investments as additional capital flows into the sector, Ventas, Inc. remains competitively advantaged. Notably, of the $1.7 billion of investments closed year to date, more than 90% were relationship-driven, over 60% were sourced off-market, and more than 40% were completed with repeat sellers.

Since 2024, we have now completed over $5.7 billion of senior housing, adding more than 17,000 units to the SHOP portfolio. These investments have been carefully selected to closely align with our right market, right asset, right operator framework, and they are performing in line with our underwritten expectations. We are buying communities that enhance portfolio quality, are located in attractive markets with strong demand growth, are insulated from future supply risk, and deliver low- to mid-teens unlevered IRRs. Our investment strategy and team are focused on senior housing investment opportunities with different combinations of growth and yield that can produce attractive risk-adjusted returns.

For example, earlier this month, we completed a $540 million acquisition of the Revel portfolio, which represents a value-add lease-up opportunity at scale. This investment consists of newly built luxury independent living communities located in affluent, high-growth markets across the Western U.S. With average in-place occupancy in the mid-70% range, the combination of the newer assets, high-barrier markets, and significant embedded occupancy upside creates a highly attractive growth profile. This portfolio was acquired at a significant discount to replacement cost, even with its quality, scale, and amenity set.

The seller elected to retain a 25% interest in the portfolio to share in the strategic and financial benefits of implementing Ventas OI initiatives across the portfolio to drive unlevered IRRs in the mid-teens. Transactions like this underscore the advantages of scale, relationships, operating expertise, and decisiveness in today’s market. Excluding the Revel transaction, our remaining senior housing investments completed so far in 2026 are expected to generate a 6.9% year-one NOI yield and low- to mid-teens unlevered IRRs. These investments also allow us to expand our operator relationships.

Our Ventas OI platform provides the capabilities to manage multiple operators at scale, enabling us to retain strong in-place operators and support their growth. Looking ahead, we plan to continue to pursue attractive senior housing investments that combine durable in-place cash flow, embedded growth, and attractive risk-adjusted returns. In closing, we are encouraged by the performance of the SHOP business in the first quarter and excited about the opportunities ahead. We are executing from a position of strength with strong organic growth, compelling external investment opportunities, and a long runway for value creation.

With that, I will turn it over to Bob.

Thank you, Justin, and good morning, everyone. I will cover three areas this morning: first, our financial results for Q1; second, our balance sheet and capital activity; and finally, our updated outlook for 2026. Starting with our overall enterprise performance, we delivered a strong start to the year led by over 15% same-store cash NOI growth in our SHOP portfolio. Normalized FFO for the first quarter was $0.94 per share. Up 9% year over year, driven by total company same-store property-level growth of nearly 9% and accretive senior housing investments.

Our outpatient medical and research portfolio, or OMAR, delivered 2.4% same-store cash NOI growth, led by outpatient medical growing 3.1% year over year. Occupancy in outpatient medical reached almost 91% in the first quarter, a 50 basis point increase year over year that marks the seventh consecutive quarter of occupancy growth. Our triple-net segment grew same-store cash NOI by 1.6% in the quarter, benefiting from the 35% Brookdale cash rent escalator which went into effect 01/01/2026. Triple-net results are in line with our expectations and supportive of our confirmed full-year guidance for the segment.

Turning next to our balance sheet, our balance sheet continues to strengthen as a result of organic SHOP growth and equity-funded senior housing investments. Net debt to EBITDA improved to 5 times at quarter end, a 20 basis point sequential improvement, with further improvement expected through the balance of the year. Liquidity is strong, with $5.5 billion available at the end of the first quarter, providing Ventas, Inc. with significant financial flexibility. Our investment momentum has continued into 2026. To fund this growth, we raised approximately $2.4 billion of equity designated for 2026 investment activity, including $800 million settled during the first quarter and $1.6 billion currently available through forward equity sales agreements.

Given our encouraging start to the year, we are improving our outlook for 2026. We now expect normalized FFO per share to range from $3.82 to $3.89, or $3.86 at the midpoint, a $0.03 increase from our prior outlook. Bridging from our prior guidance midpoint, the $0.03 increase is driven by stronger organic property performance led by SHOP and accretive senior housing investment activity, which together contributed a $0.04 per share increase. These favorable items are partially offset by $0.01 from the higher forward interest rate curve. We are also increasing our total company same-store cash NOI growth outlook to nearly 10% at the midpoint, resulting from a 100 basis point higher SHOP midpoint of 16%.

A more fulsome discussion of our guidance assumptions can be found in our Q1 supplemental earnings presentation posted to our website. To close, we are very pleased with our start to 2026. The first quarter reinforces the strength of our organic performance, the durability of senior housing demand, and the embedded growth profile of our portfolio. With that, I will turn the call back to the operator.

Thank you so much. At this time, I would like to remind everyone, in order to ask a question, press star and the number one on your telephone keypad. Your first question comes from the line of Julien Blouin with Goldman Sachs. Your line is open.

Yes, thank you for taking my question. Just wanted to touch on the $540 million Revel investment. In your view, what had driven the underperformance of that portfolio, keeping it in the mid-70% range? And then as we think of how Ventas OI plugs in there, what are the lowest hanging fruit that Ventas OI can allow you to improve, and what are some of the longer-term gains that the platform gives you?

And more generally on the current transaction environment, how would you describe the current level of competition and capital chasing transactions? Are you seeing a lot more bidders showing up when you are participating in more widely brokered opportunities? And are you starting to see that reflected in some of the cap rates? Have you changed your expectations at all on the cap rate front for the rest of the year?

Great questions. I will step back and give a little history and then some of the attributes of the acquisition and the opportunity ahead. This is a portfolio that was built by Wolff Company, which is a large multifamily developer with a very long history based in Scottsdale. They entered the senior housing sector with this really exciting development because it is a resort-like independent living product that would appeal to a very active senior in a highly amenitized, luxury setting.

At the beginning, when they entered the space, they used third-party management. When they got into it, they realized they were probably better off setting up their own platform, so they set up Revel, and that was a slow start. Now they have a team that is very talented across the board. One of the reasons they wanted to work with Ventas, Inc. is the Ventas OI platform and the ability also to stay in this joint venture so they could participate in some of the upside.

What we like about it is the quality of the assets is really high, we are buying below replacement cost, and we see significant operational upside. Our team and the Revel team are already on the ground, and we are seeing pretty immediate sales upside. We are catching that portfolio at a time where it has good momentum already. We are facing a forward market that has 1,200 basis points in net demand over the next few years, so we are playing into tailwinds as well.

Put together, it is a really exciting, high-growth investment opportunity in really high-quality assets, sourced completely off market, and it should generate really good returns for us moving forward. Stepping back on the broader market and competition, we just updated our investment guidance to $3 billion, the highest we have had in three years, during a period where there is more interest in the sector. There are clearly new investors: a wide variety of PE, both large and small, owner-operators, other REITs, institutional capital. Even with that, we raised guidance with high confidence because of our competitive moat: the Ventas OI platform; the ability to manage operators at scale in a highly fragmented sector, now up to 44 operators; no financing contingency; very high liquidity; and an excellent track record of execution.

Year to date, 90% of investments are relationship oriented, 60% off market, 40% repeat sellers. The pipeline is growing. On cap rates, I mentioned previously there was a drift down from the 7s into the 6s. We printed around a 6.5% all-in, including the Revel deal, and 6.9% without.

Looking at the rest of the year, we are expecting high-6s moving forward, with a mix of value-add and high-performing communities with upside. Even though cap rates have drifted down a bit, our IRRs have remained solid, driven by Revel and other value-add opportunities that are delivering growth.

Your next question comes from the line of James Hall Kammert with Evercore. Your line is open.

Justin, I think you mentioned expenses were 5.8% this quarter, if I am not mistaken. Generically, how much of that would you say is recurring food and labor versus temporaries like sales commissions or weather?

It was total expenses at 5.8%. A lot of it was weather related. We had a little bit of volume impact. The full-year guide is 5.5%, and that includes the weather-related expense in the first quarter, but also some volume impacts throughout the rest of the year.

The principal driver to the OpEx guide from 5% to 5.5% is volume, Jim.

That is helpful. And how does Ventas, Inc. educate its senior housing residents regarding that expense dynamic vis-à-vis probable price increases? Do you think residents understand that?

Jim, good morning. One important point to start the conversation is that the labor market has been pretty constructive, and that is important given that we do hire caregivers to take care of the residents.

The other point is really the value proposition that the residents are realizing. There is a wide variety of reasons they engage with us: safety, socialization, peace of mind, ease of living, amenities, and the care delivery in assisted living and memory care settings. If you are delivering services and care the right way and engaging with residents and families in a way that builds and maintains trust, the value proposition is well understood, and the price discussion is understood as well. There is certainly an active dialogue between our operators and the residents around the cost of service and care delivery and the prices we charge in association with that.

Appreciate it. Thank you.

You bet.

Your next question comes from the line of Nicholas Joseph with Citi. Your line is open.

Thanks. It is Nick Joseph here with Seth. In terms of your comments on increased competition or more interest in the sector, in your prepared remarks you mentioned that supply and construction starts are still very low. At what point are you starting to see capital, as cap rates compress and interest rises, move into development, particularly given your comments on acquisitions versus replacement costs?

I know there is still a gap there, but are we getting closer to some of that capital becoming interested in starting new supply? And then on asset sales, given the strong transaction market and interest, what is the opportunity from the Ventas, Inc. portfolio side to recycle any senior housing assets to harvest value and redeploy into other opportunities?

Another really good question. We are still 20% to 40% off in terms of where rents need to be for most developments to pencil. When developments start to be delivered or you see starts announced, it is most likely going to be a very high price point product that is disconnected from the existing market such that the underwriting “works” for that niche. Across our markets, we see 20% to 40% higher rents needed to support new supply.

That does not mean there is no interest from potential capital, operators, and developers. Given the fundamentals are so strong and the demand outlook is so incredibly strong, it makes sense we will need new supply at some point, but it still does not seem near term. On recycling, each year we have a small amount of targeted dispositions, usually a few hundred million dollars. There is always some in senior housing.

A key part of our strategy is ensuring we are in the right markets with the right assets. If we see anything that does not support the growth profile we are targeting, we will introduce it to the market as a sale. We have been doing that consistently over the past several years, and we will continue to look for that bottom part of the portfolio to sell.

Your next question comes from the line of Vikram Malhotra with Mizuho. Your line is open.

Good morning. Thanks for taking the questions. First, going back to the Revel deal, can you give a bit more flavor as to why occupancy has not picked up and their positioning of the portfolio in terms of product mix? Is it a price point issue, a labor issue, or unit mix?

What could get you trending higher over the next year or two? And secondly, is it time for Ventas, Inc. to maybe use the fund it already has or create a new fund to monetize certain core higher-occupancy senior housing or maybe some life sciences, where you could perhaps get fees and promotes?

Good question. There is no structural issue like studios in a one-bedroom market mismatch. This investment was well built for the type of resident they are trying to serve. When you visit, you do not see many residents in their apartments—these are very active communities with a significant focus on health and wellness, fitness, and education around those topics.

There are social events, music, activity at the bar in the afternoons—it is a great environment. They have done a great job introducing a product that will work and be popular. Many locations are already proving out stabilized occupancy, but a lot of the newer product is still in lease-up. We will target those communities and work with the team in place that has generated some momentum to improve sales execution.

There are also price sophistication opportunities we can bring through the Ventas OI platform.

Vikram, this is Debbie. We do have a Ventas investment management business that includes an open-end fund and some other vehicles. With all the interest in senior housing and with Ventas, Inc.’s competitive advantages and brand, we are well positioned to continue to try to expand our footprint in senior housing in a variety of ways, which could include additional vehicles.

Your next question comes from the line of Austin Wurschmidt with KeyBanc Capital Markets. Your line is open.

Good morning. Justin, the incremental margin within the SHOP segment has remained around the 50% level, which I think you previously assumed in initial guidance. Has anything changed relative to what is assumed in the revised guidance? And given occupancy within the same-store pool is now above 90%, when do you think you could start to see that incremental margin improve into the 60% to 70% range or better?

Also, you reiterated that the May to September key selling season will determine how the year plays out, but you did increase occupancy guidance given the lack of seasonality you saw in 1Q. How much of that occupancy guidance increase was specific to 1Q versus flowing through a better outcome through the balance of the year?

The incremental margin has been around 50% for years, running that journey from the mid-80s to 90% occupancy. Guidance assumes it remains in the 50s this year. In our portfolio, communities that are 90%+ occupied and had flat occupancy year over year deliver a 70% incremental margin. We still have a group of communities in lease-up—our U.S. portfolio is only 87% occupied—so many communities are delivering occupancy growth.

Our goal over time is to get as many communities into that flat, high-occupancy category as possible. On occupancy guidance, the key selling season has not even started yet. We have optimism heading into it because of the strong start, and you should think about the strong start driving the increase to approximately 300 basis points for the full year, with a lot of execution left during the most important part of the year.

Your next question comes from the line of Michael Albert Carroll with RBC Capital Markets. Your line is open.

With seniors housing occupancy now above 90%, does it make more sense for operators to push for higher rates as opposed to when occupancy was in the low 80% range? Does the improved occupancy level allow these operators to be a little bit more aggressive in their operating strategy?

I would remind you we are 87% occupied in the U.S., so we see our opportunity very much as volume driven. We are happy to see good performance from both occupancy and rate, which is delivering the approximately 8.75% revenue guide for the full year. Everything is contributing to the revenue growth and the improved outlook, however volume remains the number one focus. We do know when you have higher-occupied communities there is better opportunity for price performance, and we see that in our portfolio, but the primary opportunity is to continue to drive occupancy in the U.S.

Right, and that is what sets up the multiyear growth and value creation opportunity from organic growth in SHOP—the rate and occupancy working together to deliver outperformance.

And circling back on potential developments, have there been interesting development opportunities across your desk that you are willing to pursue, or is it still mainly focused on acquisitions at this point?

We are certainly focused on acquisitions. We are in our third year of a very successful run acquiring communities that are accretive in year one and have a growth profile supporting low- to mid-teens unlevered IRRs. The pipeline has grown, and we are executing on it. That is our first priority, along with continuing to drive organic performance across the SHOP portfolio and improving performance in the communities we already own.

Development opportunities may come in the future, but that is not our focus at this time.

Your next question comes from the line of Wesley Keith Golladay with Baird. Your line is open.

Good morning, everyone. Back to the Revel portfolio—looking on the website, A Place for Mom looks highly rated. What is the game plan? Is it really leaning into Ventas OI given the [inaudible] operator, more data, advice on pricing—how near term is the opportunity?

Will their portfolio be ready for the key leasing season? And when you look at the pipeline, is this a unique opportunity, or do you have similar value-add deals coming that could deliver nice growth within a few years?

It is absolutely ready for the key selling season. These are well-constructed, resort-like communities that will be very competitive. Early in discussions with Wolff, it became clear that the combination of great communities in high-demand markets, a newly reinvigorated and talented management team, and the Ventas OI platform—which includes our data analytics and boots-on-the-ground approach already underway—sets us up to create value together. The biggest opportunity is to continue to drive sales, and price and volume always work together, so we will bring our expertise in both areas.

On whether this is unique, we have had a number of similar value-add opportunities already—just smaller. This is the first at scale, and we are excited about it. We have other value-add opportunities in the $3 billion pipeline and look forward to delivering accretive investments with growth.

Your next question comes from the line of Juan Carlos Sanabria with BMO Capital Markets. Your line is open.

Good morning. On seniors, there have been press articles about operators being able to charge entrance fees and maybe generate some revenue off waitlists given tight markets. What is your approach, and how might that contribute to the 100% occupancy goal or zero-days downtime? And second, on development or supply, curious on the appetite to structure something with a preferred or mezz component where you could earn a return during buildout or lease-up—historically you have not done U.S. development in seniors housing.

Is that of interest, given some leading operators have talked about development?

It starts with the value proposition. This is a private-pay, consumer-driven business that people choose for the security it offers them and their families. That is encouraging, especially with the demographic demand accelerating and remaining elevated for a long period. Justin can speak to management of communities as they go up the curve in occupancy.

You mentioned entrance fees—I will reframe as community fees, which have been part of industry pricing for many years. In more competitive periods, they would be reduced or waived; in this period of increased demand, they are going up. We are seeing higher community fees across our portfolio. We are also starting to see waitlists form.

We have had them for many years in Canada—our longest waitlists are in Quebec—and we are starting to have some in the U.S. There are certainly deposits required for waitlists, and in some cases you can charge to be on a waitlist. We are at the front end of that, but demand and the value proposition are very appealing, which has supported better pricing. On structured development capital, there are structures we can utilize that make sense, and with the right opportunity we can underwrite returns, and we have partners qualified to do that with us.

It is just not a big area of focus for us. We are focused on acquisitions that are accretive and deliver low- to mid-teens unlevered IRRs. So yes, there is a way to do it, but that is not where we are focused at scale at this point.

Your next question comes from the line of Farrell Granath with Bank of America. Your line is open.

Hi, good morning. First on the increase in cash G&A—you mentioned adding staff on the SHOP platform. Are there any other contributing factors or initiatives going into that figure? And on the rollout of Ventas OI, is that fully with all your operators currently on your SHOP platform, or is there an additional rollout we should expect?

On cash G&A, as we mentioned in February and as you see in the first quarter numbers, we are investing behind the business. We are growing and scaling the platform and investing behind that—people, process, technology—in order to accelerate growth. We continue to believe that growth in cash G&A will be in line with the growth of the enterprise. We remain focused on efficiency and effectiveness, and the first quarter is representative of the plan.

Ventas OI is fully integrated. If you are new to us, there is a period of time that has to pass before you are fully integrated, and we have a number of newer operators that have joined us in recent months. But this is a fully integrated platform across all of our operators and geographies, primarily in the U.S., combining our data analytics platform with experiential insights delivered through boots-on-the-ground site visits with our operators.

Your next question comes from the line of Richard Anderson with Cantor Fitzgerald. Your line is open.

Thanks. Good morning. Great quarter. Early on, Debbie, you said you are seeing increased engagement to do deals with Ventas, Inc.

I am curious why anyone would be a motivated seller with everything starting to happen here—it is not like they are getting 5 caps and getting paid for the opportunity set going forward. What is in it for people to be a seller today beyond Revel? And along those lines, do you think there will be more in the way of JV-type deals you will have to accommodate to continue to grow?

Good question. It is true more people are bringing assets to market, building our pipeline and giving us a great opportunity set. Sellers come in different varieties: private equity, holders with limited-life vehicles or holding periods that have been extended over the last couple of years who want to achieve returns and recycle capital; we see some debt maturities. When assets get into our hands, they are likely to perform better.

We may have better returns than the seller could if they held on, given our advantaged platform. This is a very difficult business to run on a one-off basis or at small scale. We are building a platform to outperform at scale. Those are some of the reasons.

On joint ventures, the Revel deal is a strength-on-strength JV to create value. In any investment, we look for alignment. We found it there through a JV. Most of our senior housing investments are done through aligned management agreements, helping us be on the same page with operators from day one. The rest of our expected investment activity is 100% equity by Ventas, Inc.

A follow-up—many REITs and others are going after this opportunity. Everyone is sort of standing on the same side of the boat, and eventually the boat tips. Do you see an opportunity where buyers today may be necessary sellers a couple of years from now when development comes back and rents move closer to support new supply?

I agree, and the reason is about the expertise and data necessary to do well in this business. Some new entrants will find it more challenging and will likely be sellers, because you really have to know what you are doing. Justin has decades in the industry, and we have spent five years building this platform. It is differentiated and effective.

Without that, it is harder to succeed. That should give us more opportunity over the next couple of years.

Okay. Great. Thanks very much.

Your next question comes from the line of Michael Goldsmith with UBS. Your line is open.

Thanks for taking the questions. Sticking with the Revel investment, it sounds like you have done some smaller lease-up or unstabilized acquisitions in the past. This one is clearly a bit bigger. Are you more willing now to be a buyer of these types of properties?

If so, is that driven by the improved backdrop or something else? And can you provide an update on the Brookdale transitions—how those 45 assets are trending? Are you in line with your expectation of realizing $50 million of upside, and what is the timeline?

From the beginning of this investment run which started in 2024, we have been focused on unlevered IRRs in the low- to mid-teens, and we have been delivering that through a variety of senior housing investments. Value-add opportunities are great because they support more growth, and Revel hits the mid-teens on unlevered IRRs. There are other smaller opportunities like that we have done, and others in the $3 billion pipeline that will be closer to mid-teens as well. You are really pulling two levers to get there: the going-in year-one yield and the expected growth profile over time.

On the Brookdale transitions, the 45 communities were transitioned late last year and earlier this year from our Brookdale lease to our SHOP portfolio. These are large-scale communities in high-demand markets—tailwinds we are playing into. They require additional investment to be competitive. We will have completed by next month a majority of those investments.

The CapEx deployment is on track. All five operators are fully integrated into the communities and are getting a handle on the operation, focused on the key selling season. That is going as planned. We viewed 2026 as the year to put the pieces in place, and 2027 and beyond as the NOI growth opportunity.

Back in 2024, NOI run rate was around $50 million, and we anticipate doubling that over the next few years. We have put the pieces in place to get started on that process.

Your next question comes from the line of Michael Lee Stroyeck with Green Street. Your line is open.

With bidding getting more competitive, particularly within high-quality, well-stabilized product, have you seen meaningful declines in your win rates within that subsector? And a separate question: you have highlighted growth in operator count over the years. Philosophically, how do you think about operator count—what are the gives and takes of greater operator diversification, and do you expect your operator count to grow or contract from here?

Interestingly, our win rate has been pretty consistent. The pipeline is bigger, and with a consistent win rate, that is why we raised investment guidance. Yes, there are exceptional deals that go for aggressive cap rates, but we have been able to exploit our strengths and track record and maintain confidence in our ability to execute. Win rates stay high also because many deals are off market and bilateral in nature.

On operator count, the sector is fragmented—most operators have 10 or fewer assets, and the larger ones are usually around 100 or less. If you are going to invest in the space at scale, you need a platform that can accommodate multiple operators. We focus on operator selection criteria: strong local market focus and reputation; expertise in the product type; experienced talent; a management team that can create value and deliver great care and services; a culture that measures and improves customer and employee satisfaction; and managers who can deliver growth and do repeat business with us. Engagement with Ventas OI has become a competitive advantage.

We like the advantage of having more operators. We are at 44 now, and as we continue to grow in senior housing, we believe you must have a platform that can handle multiple operators.

Your next question comes from the line of Michael William Mueller with J.P. Morgan. Your line is open.

For the U.S. portfolio, what are your current thoughts on where your AL and IL occupancy should be able to max out over time?

That remains to be seen. We have had outperformance in IL occupancy growth. Debbie mentioned the demand profile, and we are really just getting to the point for our business as the baby boom population starts turning 80 this year. Assisted living also has really strong demand.

We think both IL and AL have strong demand and will probably surpass previous industry highs. Our goal is to outperform. We would expect both categories to be well into the 90%.

Justin is a big believer in zero lost revenue days—he will not be happy until every room is happily occupied by a happy resident.

Keyword is happy. If you are delivering best-in-class care and services, then people should live with us. We will do our best to deliver on that.

Your next question comes from the line of Nicholas Yulico with Scotiabank. Your line is open.

Thanks. Back to Revel—you gave the stats on an average of six years old and mid-70% occupancy. Can you give a feel for the vacancy—Is it concentrated evenly or more in recent deliveries? And for you, Debbie, we have spent most of this call on senior housing—you are having operating success and expanding the portfolio, but SHOP is 56% of NOI.

How are you thinking about the rest of the portfolio—outpatient medical, research, IRFs, LTACs, health systems—which are not adding to your growth rate or multiple? Is there opportunity to JV assets or sell them, and what would trigger reducing exposure there?

Vacancy is more in the recent deliveries. There are a handful stabilized, and the more recent deliveries have the most upside. We looked at the track record of the early developments and their lease-up once the new management team was in place, and we anticipate leveraging that approach combined with Ventas OI to deliver more occupancy growth where we have vacancy.

When we developed our one-two-three strategy in 2023, the focus was on growing SHOP organically and externally—that is one and two. Number three is driving performance across the portfolio. We have been successful executing that strategy: SHOP has delivered a fifth year of double-digit NOI growth, and we are adding over $6 billion of investments in SHOP, making it a much larger part of our portfolio. Senior housing itself is over [inaudible] percent, and by definition, the other parts of the portfolio are becoming a smaller portion overall—that is part of the strategy.

As for actions, we have shown a willingness over time to take actions to modify the portfolio when we think it will create long-term value, and we are open to that. Right now, our focus is on growing SHOP organically and externally, and we are devoting our efforts there with great effect because we think it is creating value for stakeholders.

Your next question comes from the line of Ronald Kamdem with Morgan Stanley. Your line is open.

Two quick ones. On pricing, I know the RevPOR guide was unchanged, but where did operators put through increases this year versus last year? How do you think about new versus renewal pricing and where you can push? And on acquisition mix, a couple of years ago you were more focused on stabilized assets.

With this Revel deal and maybe others, is there more of a shift to taking on a little more lease-up risk given better growth and your conviction in getting those portfolios filled?

The revenue guide increased to about 8.75%. Justin will comment on in-place increases.

We have had another good year—around 8% all-in on in-house increases. In January, where half the increases take place, it was around 7% last year, so we have seen improvement. Moving rents are favorable as well. As demand continues to pick up and occupancies go up, we would expect that to continue.

Still a lot of occupancy upside though, so it is volume first and then price opportunity down the road. On acquisition mix, our focus has been to use the right market, right asset, right operator framework to determine investments. If you get the markets right and have competitive assets, you are well positioned. From there, we find the right operator—whether keeping in place or transitioning.

We overwhelmingly keep operators. We then target double-digit to mid-teens unlevered IRRs. We have delivered low- to mid-teens unlevered IRRs over the past few years across a wide variety of senior housing communities, including some value-add opportunities. Revel is bigger and serves as a case study.

We anticipate repeating that playbook.

There are no further questions at this time. I will now hand the call back over to Debra A. Cafaro, Chairman and CEO of Ventas, Inc., for closing remarks.

Thanks, Bailey, and thanks to all of you for joining us today and for your interest in Ventas, Inc. as we drive forward on this multiyear growth and value creation opportunity. We look forward to seeing you in person soon. Thank you.

This concludes today’s conference call. You may now disconnect.