Brookdale Senior Living Inc.
For the period ended Jun 30, 2025. Filed Aug 7, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 7, 2025
BKD$9.01-16.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-07.
0001332349-25-000100
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001332349-25-000129
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 114 previous paragraphs and 146 current paragraphs.
79 unchanged; 32 reworded; 20 added; 3 removed; 0 previous and 15 current paragraphs rearranged.
Tables are not compared: 10 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (20)
Current report
We have continued execution on our ongoing capital recycling program through which we have exited non-strategic or underperforming owned assets or leases. Such activities completed during the three months ended June 30, 2025 included the sale of one owned community (42 units) and the disposal of one community (172 units) through lease termination.
Current report
During the next twelve months, we expect to close on the disposition of 12 owned communities (272 units) classified as held for sale as of June 30, 2025. The closings of the sales of the communities are subject to the satisfaction of various closing conditions, including (where applicable) the receipt of regulatory approvals. There can be no assurance that the transactions will close or, if they do, when the actual closings will occur.
Current report
The increase in resident fees was primarily attributable to a 4.8% increase in same community RevPAR, comprised of a 2.4% increase in same community RevPOR and a 190 basis point increase in same community weighted average occupancy.
Current report
The increase in facility operating expense was primarily attributable to a 4.8% increase in same community facility operating expense primarily resulting from increases in wage rates, repairs and maintenance expense, estimated incentive compensation expense, and advertising expense.
Current report
The increase in net loss was primarily attributable to the increase in facility operating expense, a $10.4 million increase in transaction, legal, and organizational restructuring costs, and an increase in depreciation and amortization expense, partially offset by the increase in resident fees.
Current report
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates, repairs and maintenance expense, estimated incentive compensation expense, and advertising expense.
Current report
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 200 basis point increase in same community weighted average occupancy and a 2.4% increase in same community RevPOR. The increase in the segment's same community RevPOR was primarily the result of the current year annual rate increase.
Current report
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates, estimated incentive compensation expense, repairs and maintenance expense, and advertising expense.
Current report
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates.
Current report
Facility Operating Lease Expense. The increase in facility operating lease expense was primarily due to the extension of the operating lease for 65 communities.
Current report
Comparison of Six Months Ended June 30, 2025 and 2024
Current report
Summary Operating Results
Current report
The increase in resident fees was primarily attributable to a 4.6% increase in same community RevPAR, comprised of a 2.6% increase in same community RevPOR and a 160 basis point increase in same community weighted average occupancy.
Current report
The increase in facility operating expense was primarily attributable to a 4.0% increase in same community facility operating expense, primarily resulting from increases in wage rates, repairs and maintenance expense, utilities expense, estimated incentive compensation expense, and advertising expense, partially offset by an additional day of expense in the prior year period due to the leap year.
Current report
Operating Results - Senior Housing Segments
Current report
Independent Living Segment
Current report
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment’s same community facility operating expense, primarily resulting from increases in wage rates, repairs and maintenance expense, and utilities expense, partially offset by an additional day of expense in the prior year due to the leap year.
Current report
CCRCs Segment
Current report
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment's same community facility operating expense, primarily resulting from an increase in wage rates, partially offset by an additional day of expense in the prior year due to the leap year.
Current report
Facility Operating Lease Expense. The increase in facility operating lease expense was primarily due to the extension of the operating lease for 65 communities.
Removed paragraphs (3)
Previous report
The increase in facility operating expense was primarily attributable to a 3.2% increase in same community facility operating expense primarily resulting from wage rate increases and an increase in utilities expense, partially offset by an additional day of expense in the prior year period due to the leap year.
Previous report
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment's same community facility operating expense due to wage rate increases and an increase in utilities expense, partially offset by an additional day of expense in the prior year period due to the leap year.
Previous report
The increase in the segment's facility operating expense was primarily attributable to an increase in costs due to increased occupancy during the period, partially offset by an additional day of expense in the prior year period due to the leap year.
Reworded paragraphs (32)
Previous wording
Certain statements in this Quarterly Report on Form 10-Q may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to various risks and uncertainties and include all statements that are not historical statements of fact and those regarding our intent, belief, or expectations. Forward-looking statements are generally identifiable by use of forward-looking terminology such as "may," "will," "should," "could," "would," "potential," "intend," "expect," "endeavor," "seek," "anticipate," "estimate," "believe," "project," "predict," "continue," "plan," "target," "annualized," or other similar words or expressions, and include statements regarding our expected financial and operational results. These forward-looking statements are based on certain assumptions and expectations, and our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Although we believe that expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our assumptions or expectations will be attained and actual results and performance could differ materially from those projected. Factors which could have a material adverse effect on our operations and future prospects or which could cause events or circumstances to differ from the forward-looking statements include, but are not limited to, events which adversely affect the ability of seniors to afford resident fees, including downturns in the economy, housing market, consumer confidence, or the equity markets and unemployment among resident family members; the effects of senior housing construction and development, lower industry occupancy, and increased competition; conditions of housing markets, regulatory changes, acts of nature, and the effects of climate change in geographic areas where we are concentrated; terminations of our resident agreements and vacancies in the living spaces we lease; changes in reimbursement rates, methods, or timing under governmental reimbursement programs including the Medicare and Medicaid programs; failure to maintain the security and functionality of our information systems, to prevent a cybersecurity attack or breach, or to comply with applicable privacy and consumer protection laws, including HIPAA; our ability to complete our capital expenditures in accordance with our plans; our ability to identify and pursue development, investment, and acquisition opportunities and our ability to successfully integrate acquisitions; competition for the acquisition of assets; our ability to complete pending or expected disposition, acquisition, or other transactions on agreed upon terms or at all, including in respect of the satisfaction of closing conditions, the risk that regulatory approvals are not obtained or are subject to unanticipated conditions, and uncertainties as to the timing of closing…
Excerpt shortened here; the source contains the full paragraph.
Current wording
Certain statements in this Quarterly Report on Form 10-Q may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to various risks and uncertainties and include all statements that are not historical statements of fact and those regarding our intent, belief, or expectations. Forward-looking statements are generally identifiable by use of forward-looking terminology such as "may," "will," "should," "could," "would," "potential," "intend," "expect," "endeavor," "seek," "anticipate," "estimate," "believe," "project," "predict," "continue," "plan," "target," "annualized," or other similar words or expressions, and include statements regarding our expected financial and operational results. These forward-looking statements are based on certain assumptions and expectations, and our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Although we believe that expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our assumptions or expectations will be attained and actual results and performance could differ materially from those projected. Factors which could have a material adverse effect on our operations and future prospects or which could cause events or circumstances to differ from the forward-looking statements include, but are not limited to, events which adversely affect the ability of seniors to afford resident fees, including downturns in the economy, housing market, consumer confidence, or the equity markets and unemployment among resident family members; the effects of senior housing construction and development, lower industry occupancy, and increased competition; conditions of housing markets, regulatory changes, acts of nature, and the effects of climate change in geographic areas where we are concentrated; terminations of our resident agreements and vacancies in the living spaces we lease; changes in reimbursement rates, methods, or timing under governmental reimbursement programs including the Medicare and Medicaid programs; failure to maintain the security and functionality of our information systems, to prevent a cybersecurity attack or breach, or to comply with applicable privacy and consumer protection laws, including HIPAA; our ability to complete our capital expenditures in accordance with our plans; our ability to identify and pursue development, investment, and acquisition opportunities and our ability to successfully integrate acquisitions; competition for the acquisition of assets; our ability to complete pending or expected disposition, acquisition, or other transactions on agreed upon terms or at all, including in respect of the satisfaction of closing conditions, the risk that regulatory approvals are not obtained or are subject to unanticipated conditions, and uncertainties as to the timing of closing…
Excerpt shortened here; the source contains the full paragraph.
Previous wording
We are the nation's premier operator of senior living communities, operating and managing 647 communities in 41 states as of March 31, 2025, with the ability to serve approximately 58,000 residents. We offer our residents access to a broad continuum of services across the most attractive sectors of the senior living industry. We operate and manage independent living, assisted living, memory care, and continuing care retirement communities ("CCRCs"). As of March 31, 2025, we owned 383 communities (33,768 units), leased 236 communities (17,073 units), and managed 28 communities (4,256 units).
Current wording
We are the nation's premier operator of senior living communities, operating and managing 645 communities in 41 states as of June 30, 2025, with the ability to serve approximately 58,000 residents. We offer our residents access to a broad continuum of services across the most attractive sectors of the senior living industry. We operate and manage independent living, assisted living, memory care, and continuing care retirement communities ("CCRCs"). As of June 30, 2025, we owned 382 communities (33,728 units), leased 235 communities (16,903 units), and managed 28 communities (4,256 units).
Previous wording
In December 2024, we and certain of our subsidiaries, and Ventas, Inc. ("Ventas") and certain of its subsidiaries, amended the existing master lease arrangement pursuant to which we lease 120 communities (10,180 units). Beginning January 1, 2026, we will continue to lease 65 communities (4,055 units) and the remaining 55 communities (6,125 units) that are not renewed will either be sold by Ventas or transitioned, with such transitions commencing on or after September 1, 2025. Our same community portfolio excludes the 55 communities leased from Ventas with a lease maturity in 2025.
Current wording
In December 2024, we and certain of our subsidiaries, and Ventas, Inc. ("Ventas") and certain of its subsidiaries, amended the existing master lease arrangement pursuant to which we lease 120 communities (10,180 units). Beginning January 1, 2026, we will continue to lease 65 communities (4,055 units) and the remaining 55 communities (6,127 units) that are not renewed will either be sold by Ventas or transitioned, with such transitions commencing on or after September 1, 2025. Our same community portfolio excludes the 55 communities leased from Ventas with a lease maturity in 2025.
Previous wording
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 3.1% increase in same community RevPOR and a 120 basis point increase in same community weighted average occupancy. The increase in the segment's same community RevPOR was primarily the result of the current year rate increase.
Current wording
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 3.1% increase in same community RevPOR and a 130 basis point increase in same community weighted average occupancy. The increase in the segment's same community RevPOR was primarily the result of the current year annual rate increase.
Previous wording
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 250 basis point increase in same community weighted average occupancy, partially offset by a 0.3% decrease in the segment's same community RevPOR. The decrease in the segment's same community RevPOR was primarily the result of lower skilled nursing revenue and an occupancy mix shift to more independent living residents, partially offset by the current year rate increase.
Current wording
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 260 basis point increase in same community weighted average occupancy and a 0.3% increase in the segment's same community RevPOR. The increase in the segment's same community RevPOR was primarily the result of the current year annual rate increase, partially offset by lower skilled nursing revenue and an occupancy mix shift to more independent living residents.
Previous wording
General and Administrative Expense. The increase in general and administrative expense was primarily attributable to $1.6 million of transaction costs for stockholder relations advisory matters in the current period and an increase in non-cash stock-based compensation expense compared to the prior year period. General and administrative expense includes transaction, legal, and organizational restructuring costs of $1.7 million and $0.4 million for the three months ended March 31, 2025 and 2024, respectively. Transaction costs include those directly related to acquisition, disposition, financing, and leasing activity and stockholder relations advisory matters, and are primarily comprised of legal, finance, consulting, professional fees, and other third-party costs. Legal costs include charges associated with putative class action litigation. Organizational restructuring costs include those related to our efforts to reduce general and administrative expense and our senior leadership changes, including severance costs. For the three months ending June 30, 2025, we expect organizational restructuring costs related to our recent senior leadership change to be approximately $5.0 million and we expect to incur additional transaction costs related to stockholder relations advisory matters.
Current wording
General and Administrative Expense. The increase in general and administrative expense was primarily attributable to $5.2 million of organizational restructuring costs related to our senior leadership change and $5.1 million of transaction costs for stockholder relations advisory matters in the current period. General and administrative expense includes transaction, legal, and organizational restructuring costs of $10.5 million and $0.1 million for the three months ended June 30, 2025 and 2024, respectively. Transaction costs include those directly related to acquisition, disposition, financing, and leasing activity and stockholder relations advisory matters, and are primarily comprised of legal, finance, consulting, professional fees, and other third-party costs. Legal costs include charges associated with putative class action litigation. Organizational restructuring costs include those related to our efforts to reduce general and administrative expense and our senior leadership changes, including severance costs.
Previous wording
Benefit (Provision) for Income Taxes. The difference between our effective tax rate for the three months ended March 31, 2025 and 2024 was primarily due to an increase in the benefit recorded on operating losses during the three months ended March 31, 2025. We recorded an aggregate deferred federal, state, and local tax benefit of $15.9 million for the three months ended March 31, 2025, which was partially offset by an increase in the valuation allowance of $14.7 million.
Current wording
Benefit (Provision) for Income Taxes. The difference between our effective tax rate for the three months ended June 30, 2025 and 2024 was primarily due to an increase in the benefit recorded on operating losses during the three months ended June 30, 2025. We recorded an aggregate deferred federal, state, and local tax benefit of $9.1 million for the three months ended June 30, 2025, which was partially offset by an increase in the valuation allowance of $8.3 million.
Previous wording
We evaluate our deferred tax assets each quarter to determine if a valuation allowance is required based on whether it is more likely than not that some portion of the deferred tax asset would not be realized. Our valuation allowance as of March 31, 2025 and December 31, 2024 was $536.2 million and $521.5 million, respectively.
Current wording
We evaluate our deferred tax assets each quarter to determine if a valuation allowance is required based on whether it is more likely than not that some portion of the deferred tax asset would not be realized. Our valuation allowance as of June 30, 2025 and December 31, 2024 was $544.5 million and $521.5 million, respectively.
Previous wording
The increase in net loss was primarily attributable to the $32.8 million loss on extinguishment of a financing obligation during the three months ended March 31, 2025 for the reacquisition of three communities previously subject to sale-leaseback transactions for the amount by which the repurchase price exceeded the previously recognized financing obligation for such three communities, the increase in facility operating expense, and an increase in interest expense, partially offset by the increase in resident fees.
Current wording
The increase in net loss was primarily attributable to a $32.8 million loss on extinguishment of a financing obligation during the six months ended June 30, 2025 for the reacquisition of three communities previously subject to sale-leaseback transactions for the amount by which the repurchase price exceeded the previously recognized financing obligation for such three communities, the increase in facility operating expense, an $11.7 million increase in transaction, legal, and organizational restructuring costs, and an increase in depreciation and amortization expense, partially offset by the increase in resident fees.
Previous wording
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 3.0% increase in same community RevPOR and a 70 basis point increase in same community weighted average occupancy. The increase in the segment's same community RevPOR was primarily the result of the current year rate increase.
Current wording
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 3.0% increase in same community RevPOR and a 100 basis point increase in same community weighted average occupancy. The increase in the segment's same community RevPOR was primarily the result of the current year annual rate increase.
Previous wording
The increase in resident fees was primarily attributable to a 4.5% increase in same community RevPAR, comprised of a 2.8% increase in same community RevPOR and a 130 basis point increase in same community weighted average occupancy.
Current wording
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, comprised of a 2.8% increase in same community RevPOR and a 160 basis point increase in same community weighted average occupancy. The increase in the segment's same community RevPOR was primarily the result of the current year annual rate increase.
Previous wording
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment's same community facility operating expense due to wage rate increases and an increase in utilities expense, partially offset by an additional day of expense in the prior year period due to the leap year. The segment's same community facility operating expense for the three months ended March 31, 2025 and 2024 excludes $1.0 million and $2.3 million, respectively, of natural disaster expense.
Current wording
The increase in the segment's facility operating expense was primarily attributable to an increase in the segment's same community facility operating expense, primarily resulting from increases in wage rates, utilities expense, repairs and maintenance expense, and advertising expense, partially offset by an additional day of expense in the prior year due to the leap year. The segment's same community facility operating expense for the six months ended June 30, 2025 and 2024 excludes $1.2 million and $2.3 million, respectively, of natural disaster expense.
Previous wording
Interest Expense. The increase in interest expense was primarily due to an increase in the fair value of interest rate derivatives in the prior year period and an increase in interest expense due to the acquisition of 36 communities previously subject to operating leases subsequent to the prior year period.
Current wording
Interest Expense. The increase in interest expense was primarily due to debt obtained to finance the acquisition of 36 communities previously subject to operating leases subsequent to the prior year period and an increase in the fair value of interest rate derivatives in the prior year period.
Previous wording
Gain (Loss) on Debt Modification and Extinguishment, Net. The increase in loss on debt modification and extinguishment, net was primarily due to a $32.8 million loss on extinguishment of a financing obligation for the reacquisition of three communities previously subject to sale-leaseback transactions.
Current wording
Gain (Loss) on Debt Modification and Extinguishment, Net. The increase in loss on debt modification and extinguishment, net was primarily due to a $32.8 million loss on extinguishment of a financing obligation during the current period for the reacquisition of three communities previously subject to sale-leaseback transactions.
Previous wording
The change in net cash provided by (used in) operating activities was primarily attributable to an increase in resident fees compared to the prior year period, partially offset by an increase in facility operating expense compared to the prior year period.
Current wording
The increase in net cash provided by operating activities was primarily attributable to an increase in resident fees and a $10.0 million increase in lessor reimbursements for capital expenditures for operating leases compared to the prior year period, partially offset by an increase in facility operating expense compared to the prior year period.
Previous wording
The increase in net cash used in investing activities was primarily attributable to $311.0 million of cash paid for the acquisition of formerly leased communities.
Current wording
The increase in net cash used in investing activities was primarily attributable to $311.0 million of cash paid for the acquisition of formerly leased communities in the current period.
Previous wording
The increase in net cash provided by financing activities was primarily attributable to a $239.8 million increase in debt proceeds compared to the prior year period, partially offset by a $49.8 million increase in repayment of debt and financing lease obligations compared to the prior year period.
Current wording
The increase in net cash provided by financing activities was primarily attributable to a $239.5 million increase in debt proceeds compared to the prior year period, partially offset by a $54.3 million increase in repayment of debt and financing lease obligations compared to the prior year period.
Previous wording
The change in Adjusted Free Cash Flow was primarily attributable to the change in net cash provided by (used in) operating activities and a $9.5 million decrease in non-development capital expenditures, net compared to the prior year period, partially offset by a decrease in property and casualty insurance proceeds.
Current wording
The change in Adjusted Free Cash Flow was primarily attributable to the increase in net cash provided by operating activities.
Previous wording
We are highly leveraged and have significant debt and lease obligations. As of March 31, 2025, we had $4.3 billion of debt outstanding at a weighted average interest rate of 5.21%. As of such date, 87.7%, or $3.8 billion, of our total debt obligations represented non-recourse property-level mortgage financings.
Current wording
We are highly leveraged and have significant debt and lease obligations. As of June 30, 2025, we had $4.3 billion of debt outstanding at a weighted average interest rate of 5.20%. As of such date, 88.0%, or $3.8 billion, of our total debt obligations represented non-recourse property-level mortgage financings.
Previous wording
As of March 31, 2025, we had $1.3 billion of operating and financing lease obligations, and for the twelve months ending March 31, 2026, we will be required to make approximately $225.0 million of cash lease payments in connection with our existing operating and financing leases.
Current wording
As of June 30, 2025, we had $1.3 billion of operating and financing lease obligations, and for the twelve months ending June 30, 2026, we will be required to make approximately $215.0 million of cash lease payments in connection with our existing operating and financing leases (without giving effect to the potential early termination by Ventas of certain of our community leases with maturity dates of December 31, 2025).
Previous wording
Total liquidity of $306.0 million as of March 31, 2025 included $239.7 million of unrestricted cash and cash equivalents (excluding restricted cash of $76.4 million) and $66.3 million of availability on our secured credit facility. Total liquidity as of March 31, 2025 decreased $83.3 million from total liquidity of $389.3 million as of December 31, 2024. The decrease was primarily attributable to cash paid for acquisitions, net of financing proceeds during the period.
Current wording
Total liquidity of $350.0 million as of June 30, 2025 included $251.9 million of unrestricted cash and cash equivalents (excluding restricted cash of $71.7 million) and $98.1 million of availability on our secured credit facility (excluding $16.1 million of availability on our separate letter of credit facilities, which can be drawn only as letters of credit). Total liquidity as of June 30, 2025 decreased $39.3 million from total liquidity of $389.3 million as of December 31, 2024. The decrease was primarily attributable to cash paid for acquisitions, net of financing proceeds during the period, partially offset by a $37.6 million increase in availability on our secured credit facility and $23.7 million of Adjusted Free Cash Flow during the period.
Previous wording
As of March 31, 2025, our current liabilities exceeded current assets by $101.7 million. Included in our current liabilities is $103.1 million of the current portion of operating and financing lease obligations, for which the associated right-of-use assets are excluded from current assets on our condensed consolidated balance sheets. We currently estimate our historical principal sources of liquidity, primarily our cash flows from operations, together with cash balances on hand and cash equivalents and proceeds from financings and refinancings of various assets will be sufficient to fund our liquidity needs for at least the next 12 months. We continue to focus on increasing our RevPAR, maintaining appropriate expense discipline, continuing to refinance or exercise available extension options for maturing debt, continuing to evaluate our capital structure and the state of debt and equity markets, and monetizing non-strategic or underperforming owned assets. There is no assurance that financing will continue to be available on terms consistent with our expectations or at all, or that our efforts will be successful in monetizing certain assets or exercising extension options.
Current wording
As of June 30, 2025, our current liabilities exceeded current assets by $98.2 million. Included in our current liabilities is $93.2 million of the current portion of operating and financing lease obligations, for which the associated right-of-use assets are excluded from current assets on our condensed consolidated balance sheets. We currently estimate our historical principal sources of liquidity, primarily our cash flows from operations, together with cash balances on hand and cash equivalents, availability on our secured credit facility, and proceeds from financings and refinancings of various assets will be sufficient to fund our liquidity needs for at least the next 12 months. We continue to focus on increasing our RevPAR, maintaining appropriate expense discipline, continuing to refinance or exercise available extension options for maturing debt, continuing to evaluate our capital structure and the state of debt and equity markets, and monetizing non-strategic or underperforming owned assets. There is no assurance that financing will continue to be available on terms consistent with our expectations or at all, or that our efforts will be successful in monetizing certain assets or exercising extension options.
Previous wording
The following table summarizes our capital expenditures for the three months ended March 31, 2025 for our consolidated business.
Current wording
The following table summarizes our capital expenditures for the six months ended June 30, 2025 for our consolidated business.
Previous wording
(1)Reflects the amount invested, net of lessor reimbursements of $2.0 million.
Current wording
(1)Reflects the amount invested, net of lessor reimbursements of $11.3 million.
Previous wording
As of March 31, 2025, $33.7 million of letters of credit and no cash borrowings were outstanding under our $100.0 million secured credit facility and the facility had $66.3 million of availability. We also had separate letter of credit facilities providing up to $37.0 million of letters of credit as of March 31, 2025 under which $35.7 million had been issued as of that date.
Current wording
As of June 30, 2025, $1.9 million of letters of credit and no cash borrowings were outstanding under our $100.0 million secured credit facility and the facility had $98.1 million of availability. We also had separate letter of credit facilities providing up to $85.0 million of letters of credit as of June 30, 2025 under which $68.9 million had been issued as of that date.
Previous wording
As of March 31, 2025, we operated 236 communities under long-term leases (227 operating leases and 9 financing leases). The substantial majority of our lease arrangements are structured as master leases. Under a master lease, numerous communities are leased through an indivisible lease. In certain cases, we guarantee the performance and lease payment obligations of our subsidiary lessees under the master leases. Due to the nature of such master leases, it is difficult to restructure the composition of our leased portfolios or economic terms of the leases without the consent of the applicable landlord. In addition, an event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio.
Current wording
As of June 30, 2025, we operated 235 communities under long-term leases (226 operating leases and 9 financing leases). The substantial majority of our lease arrangements are structured as master leases. Under a master lease, numerous communities are leased through an indivisible lease. In certain cases, we guarantee the performance and lease payment obligations of our subsidiary lessees under the master leases. Due to the nature of such master leases, it is difficult to restructure the composition of our leased portfolios or economic terms of the leases without the consent of the applicable landlord. In addition, an event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio.
Previous wording
For the three months ended March 31, 2025, our cash lease payments for our operating leases were $58.8 million and for our financing leases were $5.9 million. For the twelve months ending March 31, 2026, we will be required to make approximately $225.0 million of cash lease payments in connection with our existing operating and financing leases.
Current wording
For the six months ended June 30, 2025, our cash lease payments for our operating leases were $118.4 million and for our financing leases were $7.9 million. For the twelve months ending June 30, 2026, we will be required to make approximately $215.0 million of cash lease payments in connection with our existing operating and financing leases (without giving effect to the potential early termination by Ventas of certain of our community leases with maturity dates of December 31, 2025).
Previous wording
Certain of our long-term debt and lease documents contain restrictions and financial covenants, such as those requiring us to maintain prescribed minimum liquidity and net worth levels and debt service and lease coverage ratios, and requiring us not to exceed prescribed leverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community, and/or entity basis. These covenants include a requirement contained in certain of our long-term debt documents for us to maintain liquidity of at least $130.0 million at each quarter-end determination date. As of March 31, 2025, our liquidity was $306.0 million.
Current wording
Certain of our long-term debt and lease documents contain restrictions and financial covenants, such as those requiring us to maintain prescribed minimum liquidity and net worth levels and debt service and lease coverage ratios, and requiring us not to exceed prescribed leverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community, and/or entity basis. These covenants include a requirement contained in certain of our long-term debt documents for us to maintain liquidity of at least $130.0 million at each quarter-end determination date. As of June 30, 2025, our liquidity was $350.0 million.
Previous wording
This Quarterly Report on Form 10-Q contains the financial measures Adjusted EBITDA and Adjusted Free Cash Flow, which are not calculated in accordance with GAAP. Presentations of these non-GAAP financial measures are intended to aid investors in better understanding the factors and trends affecting our performance and liquidity. However, investors should not consider these non-GAAP financial measures as a substitute for financial measures determined in accordance with GAAP, including net income (loss), income (loss) from operations, or net cash provided by (used in) operating activities. We caution investors that amounts presented in accordance with our definitions of these non-GAAP financial measures may not be comparable to similar measures disclosed by other companies because not all companies calculate non-GAAP measures in the same manner. We urge investors to review the following reconciliations of these non-GAAP financial measures from the most comparable financial measures determined in accordance with GAAP.
Current wording
This Quarterly Report on Form 10-Q contains the financial measures Adjusted EBITDA and Adjusted Free Cash Flow, which are not calculated in accordance with GAAP. Presentations of these non-GAAP financial measures are intended to aid investors in better understanding the factors and trends affecting our performance and liquidity. However, investors should not consider these non-GAAP financial measures as a substitute for financial measures determined in accordance with GAAP, including net income (loss), income (loss) from operations, or net cash provided by operating activities. We caution investors that amounts presented in accordance with our definitions of these non-GAAP financial measures may not be comparable to similar measures disclosed by other companies because not all companies calculate non-GAAP measures in the same manner. We urge investors to review the following reconciliations of these non-GAAP financial measures from the most comparable financial measures determined in accordance with GAAP.
Previous wording
Adjusted EBITDA is a non-GAAP performance measure that we define as net income (loss) excluding: benefit/provision for income taxes, non-operating income/expense items, and depreciation and amortization; and further adjusted to exclude income/expense associated with non-cash, non-operational, transactional, legal, cost reduction, or organizational restructuring items that management does not consider as part of our underlying core operating performance and that management believes impact the comparability of performance between periods. For the periods presented herein, such other items include non-cash impairment charges, operating lease expense adjustment, non-cash stock-based compensation expense, and transaction, legal, and organizational restructuring costs. Transaction costs include those directly related to acquisition, disposition, financing, and leasing activity and stockholder relations advisory matters, and are primarily comprised of legal, finance, consulting, professional fees, and other third-party costs. Legal costs include charges associated with putative class action litigation. Organizational restructuring costs include those related to our efforts to reduce general and administrative expense and our senior leadership changes, including severance.
Current wording
Adjusted EBITDA is a non-GAAP performance measure that we define as net income (loss) excluding: benefit/provision for income taxes, non-operating income/expense items, and depreciation and amortization; and further adjusted to exclude income/expense associated with non-cash, non-operational, transactional, legal, cost reduction, or organizational restructuring items that management does not consider as part of our underlying core operating performance and that management believes impact the comparability of performance between periods. For the periods presented herein, such other items include non-cash impairment charges, operating lease expense adjustment, non-cash stock-based compensation expense, gain/loss on sale of communities, and transaction, legal, and organizational restructuring costs. Transaction costs include those directly related to acquisition, disposition, financing, and leasing activity and stockholder relations advisory matters, and are primarily comprised of legal, finance, consulting, professional fees, and other third-party costs. Legal costs include charges associated with putative class action litigation. Organizational restructuring costs include those related to our efforts to reduce general and administrative expense and our senior leadership changes, including severance.
Previous wording
Adjusted Free Cash Flow is a non-GAAP liquidity measure that we define as net cash provided by (used in) operating activities before: distributions from unconsolidated ventures from cumulative share of net earnings, changes in prepaid insurance premiums financed with notes payable, changes in operating lease assets and liabilities for lease termination, cash paid/received for gain/loss on facility operating lease termination, and lessor capital expenditure reimbursements under operating leases; plus: property and casualty insurance proceeds; less: non-development capital expenditures and payment of financing lease obligations. Non-development capital expenditures are comprised of corporate and community-level capital expenditures, including those related to maintenance, renovations, upgrades, and other major building infrastructure projects for our communities and is presented net of lessor reimbursements. Non-development capital expenditures do not include capital expenditures for: community expansions, major community redevelopment and repositioning projects, and the development of new communities.
Current wording
Adjusted Free Cash Flow is a non-GAAP liquidity measure that we define as net cash provided by operating activities before: distributions from unconsolidated ventures from cumulative share of net earnings, changes in prepaid insurance premiums financed with notes payable, changes in operating lease assets and liabilities for lease termination, cash paid/received for gain/loss on facility operating lease termination, and lessor capital expenditure reimbursements under operating leases; plus: property and casualty insurance proceeds; less: non-development capital expenditures and payment of financing lease obligations. Non-development capital expenditures are comprised of corporate and community-level capital expenditures, including those related to maintenance, renovations, upgrades, and other major building infrastructure projects for our communities and is presented net of lessor reimbursements. Non-development capital expenditures do not include capital expenditures for: community expansions, major community redevelopment and repositioning projects, and the development of new communities.
Previous wording
The table below reconciles Adjusted Free Cash Flow from net cash provided by (used in) operating activities.
Current wording
The table below reconciles Adjusted Free Cash Flow from net cash provided by operating activities.
Rearranged current paragraphs (15)
Current report — wording carried from elsewhere
Interest expense. The increase in interest expense was primarily due to debt obtained to finance the acquisition of 36 communities previously subject to operating leases subsequent to the prior year period.
Current report — wording carried from elsewhere
The following table summarizes our overall operating results for the six months ended June 30, 2025 and 2024.
Current report — wording carried from elsewhere
The increase in Adjusted EBITDA was primarily attributable to the increase in resident fees and a decrease in cash facility operating lease payments, partially offset by the increase in facility operating expense.
Current report — wording carried from elsewhere
The following table summarizes the operating results and data of our three senior housing segments (Independent Living, Assisted Living and Memory Care, and CCRCs) on a combined basis for the six months ended June 30, 2025 and 2024 including operating results and data on a same community basis. See management's discussion and analysis of the operating results on an individual segment basis on the following pages.
Current report — wording carried from elsewhere
The following table summarizes the operating results and data for our Independent Living segment for the six months ended June 30, 2025 and 2024, including operating results and data on a same community basis.
Current report — wording carried from elsewhere
Assisted Living and Memory Care Segment
Current report — wording carried from elsewhere
The following table summarizes the operating results and data for our Assisted Living and Memory Care segment for the six months ended June 30, 2025 and 2024, including operating results and data on a same community basis.
Current report — wording carried from elsewhere
The following table summarizes the operating results and data for our CCRCs segment for the six months ended June 30, 2025 and 2024, including operating results and data on a same community basis.
Current report — wording carried from elsewhere
The increase in the segment's resident fees was primarily attributable to an increase in the segment's same community RevPAR, primarily resulting from a 250 basis point increase in same community weighted average occupancy. The segment's same community RevPOR did not change as the impact of the current year annual rate increase was offset by lower skilled nursing revenue and an occupancy mix shift to more independent living residents.
Current report — wording carried from elsewhere
Operating Results - Other Income and Expense Items
Current report — wording carried from elsewhere
The following table summarizes other income and expense items in our operating results for the six months ended June 30, 2025 and 2024.
Current report — wording carried from elsewhere
General and Administrative Expense. The increase in general and administrative expense was primarily attributable to $5.2 million of organizational restructuring costs related to our senior leadership change and $6.7 million of transaction costs for stockholder relations advisory matters in the current period. General and administrative expense includes transaction, legal, and organizational restructuring costs of $12.2 million and $0.5 million for the six months ended June 30, 2025 and 2024, respectively. Transaction costs include those directly related to acquisition, disposition, financing, and leasing activity and stockholder relations advisory matters, and are primarily comprised of legal, finance, consulting, professional fees, and other third-party costs. Legal costs include charges associated with putative class action litigation. Organizational restructuring costs include those related to our efforts to reduce general and administrative expense and our senior leadership changes, including severance costs.
Current report — wording carried from elsewhere
Depreciation and Amortization. The increase in depreciation and amortization expense was primarily due to the acquisition of 36 communities previously subject to operating leases and the completion of capital expenditures at leased communities since the beginning of the prior year period.
Current report — wording carried from elsewhere
Benefit (Provision) for Income Taxes. The difference between our effective tax rate for the six months ended June 30, 2025 and 2024 was primarily due to an increase in the benefit recorded on operating losses during the six months ended June 30, 2025.
Current report — wording carried from elsewhere
We recorded an aggregate deferred federal, state, and local tax benefit of $24.9 million for the six months ended June 30, 2025, which was partially offset by an increase in the valuation allowance of $23.0 million. We recorded an aggregate deferred federal, state, and local tax benefit of $16.7 million for the six months ended June 30, 2024, which was partially offset by an increase to the valuation allowance of $16.3 million.