Brookdale Senior Living Inc.
For the period ended Jun 30, 2026. Filed Aug 10, 2026.
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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, 2026 · Filed Aug 10, 2026
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 2026-03-31; filed 2026-05-07.
0001332349-26-000048
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-10.
0001332349-26-000064
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 113 previous paragraphs and 149 current paragraphs.
73 unchanged; 32 reworded; 28 added; 8 removed; 0 previous and 16 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 (28)
Current report
Community Transactions
Current report
Subsequent to June 30, 2026, we entered into an agreement to acquire 17 communities (735 units) that are currently leased by us for a purchase price of approximately $157.0 million plus transaction costs. The acquisition is expected to close in the fourth quarter of 2026, subject to the satisfaction of customary closing conditions for real estate transactions. We expect to fund the acquisition through proceeds from non-recourse mortgage financing and cash on hand.
Current report
In June 2026, we acquired one previously managed community (244 units) in Houston, Texas for a purchase price of $23.4 million.
Current report
The decrease in resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $106.4 million less in resident fees during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by a 5.5% increase in same community RevPAR, comprised of a 4.1% increase in same community RevPOR and a 110 basis point increase in same community weighted average occupancy.
Current report
The decrease in facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $84.7 million less in facility operating expense during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by a 5.5% increase in same community facility operating expense primarily attributable to increases in wage rates, estimated insurance expense, maintenance expense, and estimated losses on accounts receivable.
Current report
The increase in net income was primarily attributable to a $45.4 million gain on sale of communities in the current period and a decrease in depreciation and amortization expense due to the disposition of communities since the beginning of the prior year period.
Current report
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $45.5 million less in resident fees during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 4.9% increase in same community RevPOR and a 90 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.
Current report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $30.3 million less in facility operating expense during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates, estimated insurance expense, maintenance expense, and estimated losses on accounts receivable.
Current report
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $44.2 million less in resident fees during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 3.9% 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 annual rate increase.
Current report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $39.3 million less in facility operating expense during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates, estimated insurance expense, maintenance expense, and estimated losses on accounts receivable.
Current report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $15.1 million less in facility operating expense during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates, maintenance expense, and estimated losses on accounts receivable.
Current report
Benefit (Provision) for Income Taxes. The difference between our effective tax rate for the three months ended June 30, 2026 and 2025 was primarily attributable to expense recorded on operating income during the three months ended June 30, 2026 as opposed to a benefit recorded on operating losses during the three months ended June 30, 2025.
Current report
We recorded an aggregate deferred federal, state, and local tax expense of $23.5 million for the three months ended June 30, 2026, which was partially offset by a decrease to the valuation allowance of $18.7 million. 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 to the valuation allowance of $8.3 million.
Current report
Comparison of Six Months Ended June 30, 2026 and 2025
Current report
Summary Operating Results
Current report
The decrease in resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $199.8 million less in resident fees during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by a 5.5% increase in same community RevPAR, comprised of a 3.7% increase in same community RevPOR and a 140 basis point increase in same community weighted average occupancy.
Current report
The decrease in facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $157.5 million less in facility operating expense during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by a 5.7% increase in same community facility operating expense primarily attributable to increases in wage rates, estimated insurance expense, maintenance expense, utilities expense, and estimated losses on accounts receivable.
Current report
Operating Results - Senior Housing Segments
Current report
Independent Living Segment
Current report
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $90.6 million less in resident fees during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 5.1% 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 annual rate increase.
Current report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $60.1 million less in facility operating expense during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment’s same community facility operating expense, primarily resulting from increases in wage rates, estimated insurance expense, maintenance expense, and estimated losses on accounts receivable.
Current report
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $83.2 million less in resident fees during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 3.6% increase in same community RevPOR and a 150 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.
Current report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $73.1 million less in facility operating expense during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense, primarily resulting from increases in wage rates, estimated insurance expense, maintenance expense, utilities expense, and estimated losses on accounts receivable. The segment's same community facility operating expense for the six months ended June 30, 2025 excludes $1.2 million of natural disaster expense.
Current report
CCRCs Segment
Current report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $24.3 million less in facility operating expense during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense, primarily resulting from increases in wage rates and maintenance expense.
Current report
Loss (gain) on sale of communities, net. During the six months ended June 30, 2026, we recognized a $49.4 million gain on sale of communities attributable to the sale of 13 communities for proceeds of $147.4 million, net of transaction costs.
Current report
Benefit (Provision) for Income Taxes. The difference between our effective tax rate for the six months ended June 30, 2026 and 2025 was primarily attributable to expense recorded on operating income during the six months ended June 30, 2026 as opposed to a benefit recorded on operating losses during the six months ended June 30, 2025.
Current report
We recorded an aggregate deferred federal, state, and local tax expense of $15.4 million for the six months ended June 30, 2026, which was partially offset by a decrease in the valuation allowance of $11.6 million. 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 to the valuation allowance of $23.0 million.
Removed paragraphs (8)
Previous report
Community Dispositions
Previous report
The decrease in resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $93.1 million less in resident fees during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by a 5.5% increase in same community RevPAR, comprised of a 3.4% increase in same community RevPOR and a 170 basis point increase in same community weighted average occupancy.
Previous report
The decrease in facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $72.0 million less in facility operating expense during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by a 5.9% increase in same community facility operating expense primarily due to increases in wage rates, increases in estimated insurance expense, and increases in utilities and maintenance expenses associated with winter storm activity.
Previous report
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $45.1 million less in resident fees during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 5.2% 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 report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $29.9 million less in facility operating expense during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates and increases in estimated insurance expense.
Previous report
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $39.7 million less in resident fees during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 3.2% increase in same community RevPOR and a 170 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 report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $34.1 million less in facility operating expense during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates, increases in estimated insurance expense, and increases in utilities and maintenance expenses associated with winter storm activity.
Previous report
The decrease in the segment's facility operating expense was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $8.0 million less in facility operating expense during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community facility operating expense primarily resulting from increases in wage rates and increases in utilities and maintenance expenses associated with winter storm activity.
Reworded paragraphs (32)
Previous wording
We are the nation's premier operator of senior living communities, operating and managing 568 communities in 41 states as of March 31, 2026, with the ability to serve approximately 51,000 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, 2026, we owned 363 communities (32,879 units), leased 176 communities (10,456 units), and managed 29 communities (4,293 units).
Current wording
We are the nation's premier operator of senior living communities, operating and managing 541 communities in 41 states as of June 30, 2026, with the ability to serve approximately 46,000 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, 2026, we owned 359 communities (32,294 units), leased 176 communities (10,456 units), and managed 6 communities (570 units).
Previous wording
We have continued executing 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 March 31, 2026 included the sale of seven owned communities (330 units) for proceeds of $22.1 million, net of transaction costs, and the disposal of two communities (152 units) through lease termination. Subsequent to March 31, 2026, we completed the sale of three owned communities (545 units) for cash proceeds of $88 million, net of transaction costs.
Current wording
We have continued executing on our ongoing capital recycling program through which we have exited non-strategic or underperforming owned assets or leases. Such activities completed during the six months ended June 30, 2026 included the sale of 13 owned communities (1,108 units) for proceeds of $147.4 million, net of transaction costs, and the disposal of two leased communities (152 units) through lease terminations. For the six months ended June 30, 2026, we recognized a net gain on sale of assets of $49.4 million. Subsequent to June 30, 2026, we completed the sale of three owned communities (228 units) for proceeds of $2.5 million, net of transaction costs.
Previous wording
We plan to sell 19 additional owned communities (1,438 units) during 2026. The closings of the expected sales of assets are subject (where applicable) to our successful marketing of such assets on terms acceptable to us. Further, the closings of the expected sales of assets are, or will be, subject to the satisfaction of various 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 wording
We plan to sell 13 additional owned communities (898 units) during 2026. The closings of the expected sales of assets are subject (where applicable) to our successful marketing of such assets on terms acceptable to us. Further, the closings of the expected sales of assets are, or will be, subject to the satisfaction of various 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.
Previous wording
The following table summarizes the consolidated operating results and data of our three senior housing segments (Independent Living, Assisted Living and Memory Care, and CCRCs) for the three months ended March 31, 2026 and 2025, including operating results and data on a same community basis. The same community portfolio excludes 23 communities, including 22 communities that we sold subsequent to March 31, 2026 or that we plan to sell during 2026. See management's discussion and analysis of the operating results on an individual segment basis on the following pages.
Current wording
The following table summarizes the consolidated operating results and data of our three senior housing segments (Independent Living, Assisted Living and Memory Care, and CCRCs) for the three months ended June 30, 2026 and 2025, including operating results and data on a same community basis. The same community portfolio excludes 20 communities, including 16 communities that we sold subsequent to June 30, 2026 or that we plan to sell in 2026. See management's discussion and analysis of the operating results on an individual segment basis on the following pages.
Previous wording
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $8.3 million less in resident fees during the three months ended March 31, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 210 basis point increase in same community weighted average occupancy and a 1.3% 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.
Current wording
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $16.7 million less in resident fees during the three months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 3.1% increase in the segment's same community RevPOR and a 210 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, partially offset by an occupancy mix shift to more independent living residents.
Previous wording
Reimbursed Costs Incurred on Behalf of Managed Communities and Costs Incurred on Behalf of Managed Communities. The increase in reimbursed costs and costs incurred on behalf of managed communities was primarily attributable to management agreements entered into since the beginning of the prior year period.
Current wording
Reimbursed Costs Incurred on Behalf of Managed Communities and Costs Incurred on Behalf of Managed Communities. The decrease in reimbursed costs and costs incurred on behalf of managed communities was primarily attributable to the termination of management agreements since the beginning of the prior year period.
Previous wording
General and Administrative Expense. The decrease in general and administrative expense was primarily attributable to our efforts to reduce general and administrative expense as we scaled our general and administrative costs in connection with community dispositions and $1.6 million of transaction costs for stockholder relations advisory matters in the prior year period. General and administrative expense includes transaction, legal, and organizational restructuring costs of $0.8 million and $1.7 million for the three months ended March 31, 2026 and 2025, 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 wording
General and Administrative Expense. The decrease in general and administrative expense was primarily attributable to $5.1 million of transaction costs for stockholder relations advisory matters in the prior year period and our efforts to reduce general and administrative expense as we scaled our general and administrative costs in connection with community dispositions. General and administrative expense includes transaction, legal, and organizational restructuring costs of $4.5 million and $10.5 million for the three months ended June 30, 2026 and 2025, 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
Facility Operating Lease Expense. The decrease in facility operating lease expense was primarily due to the termination of community leases subsequent to the prior year period.
Current wording
Facility Operating Lease Expense. The decrease in facility operating lease expense was primarily attributable to the termination of community leases subsequent to the prior year period.
Previous wording
Depreciation and Amortization. The decrease in depreciation and amortization expense was primarily due to the disposition of communities since the beginning of the prior year period.
Current wording
Depreciation and Amortization. The decrease in depreciation and amortization expense was primarily attributable to the disposition of communities since the beginning of the prior year period.
Previous wording
Asset Impairment. The increase in asset impairment was primarily due to changes in estimates of fair value for certain communities planned for disposition.
Current wording
Asset Impairment. The increase in asset impairment was primarily attributable to changes in estimates of fair value for certain communities planned for disposition.
Previous wording
Loss (gain) on sale of communities, net. The increase in gain on sale of communities is driven by the sale of seven communities for proceeds of $22.1 million, net of transaction costs in the three months ended March 31, 2026.
Current wording
Loss (gain) on sale of communities, net. The increase in gain on sale of communities is primarily attributable to the sale of six communities for proceeds of $125.3 million, net of transaction costs in the three months ended June 30, 2026.
Previous wording
The decrease in net loss was primarily attributable to a $32.8 million loss on extinguishment of a financing obligation during the prior year period for the reacquisition of three communities previously subject to sale-leaseback transactions and decreases in depreciation and amortization expense and facility operating lease expense due to the disposition of communities since the beginning of the prior year period.
Current wording
The increase in net income was primarily attributable to a $49.4 million gain on sale of communities in the current period, a decrease in depreciation and amortization expense due to the disposition of communities since the beginning of the prior year period, and a $32.8 million loss on extinguishment of a financing obligation during the prior year period for the reacquisition of three communities previously subject to sale-leaseback transactions.
Previous wording
Management fees. The increase in management fees was primarily attributable to $2.5 million of management termination fee revenue recognized during the three months ended March 31, 2026. Management fees of $5.4 million for the three months ended March 31, 2026 include $4.7 million of management fees attributable to communities for which our management agreements were terminated during such period or subsequent to March 31, 2026.
Current wording
Management Fees. Management fees of $6.1 million for the six months ended June 30, 2026 include $5.4 million of management fees attributable to communities for which our management agreements were terminated during such period or subsequent to June 30, 2026.
Previous wording
Interest expense. The decrease in interest expense was primarily due to the acquisition of 36 communities previously subject to financing leases subsequent to the beginning of the prior year period and an increase in the fair value of interest rate derivatives in the current period.
Current wording
Interest Expense. The decrease in interest expense was primarily attributable to an increase in the fair value of interest rate derivatives in the current period and the acquisition of 36 communities previously subject to financing leases subsequent to the beginning of the prior year period.
Previous wording
Gain (Loss) on Debt Modification and Extinguishment, Net. The decrease 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 prior year period for the reacquisition of three communities previously subject to sale-leaseback transactions.
Current wording
Gain (Loss) on Debt Modification and Extinguishment, Net. The decrease in loss on debt modification and extinguishment, net was primarily attributable to a $32.8 million loss on extinguishment of a financing obligation during the prior year period for the reacquisition of three communities previously subject to sale-leaseback transactions.
Previous wording
The decrease in net cash provided by operating activities was primarily attributable to an increase in the use of cash for changes in accrued expenses.
Current wording
The increase in net cash provided by operating activities was primarily attributable to an increase in same community resident fees partially offset by an increase in same community facility operating expense and an increase in the use of cash for changes in accrued expenses.
Previous wording
The decrease 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 prior year period.
Current wording
The change in net cash provided by (used in) investing activities was primarily attributable to a $287.5 million decrease in cash paid for the acquisition of formerly leased or managed communities and a $146.3 million increase in net proceeds from the sale of communities compared to the prior year period. These changes were partially offset by a $20.0 million decrease in proceeds from sales and maturities of marketable securities and a $19.8 million increase in purchases of marketable securities compared to the prior year period.
Previous wording
The change in net cash provided by (used in) financing activities was primarily attributable to a $147.6 million increase in repayment of debt compared to the prior year period and a $89.0 million decrease in debt proceeds compared to the prior year period.
Current wording
The change in net cash provided by (used in) financing activities was primarily attributable to a $345.4 million increase in debt repayments and a $9.4 million increase in cash paid for financing costs compared to the prior year period, partially offset by a $98.9 million increase in debt proceeds and a $23.0 million increase in proceeds from our line of credit.
Previous wording
The change in Adjusted Free Cash Flow was primarily attributable to a $7.3 million increase in non-development capital expenditures, net and the decrease in net cash provided by operating activities.
Current wording
The increase in Adjusted Free Cash Flow was primarily attributable to the increase in net cash provided by operating activities, partially offset by a $2.7 million decrease in property and casualty insurance proceeds compared to the prior year period.
Previous wording
We are highly leveraged and have significant debt and lease obligations. As of March 31, 2026, we had $4.3 billion of debt outstanding at a weighted average interest rate of 5.06%. As of such date, 89.3%, or $3.9 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, 2026, we had $4.3 billion of debt outstanding at a weighted average interest rate of 5.09%. As of such date, 88.9%, or $3.9 billion, of our total debt obligations represented non-recourse property-level mortgage financings.
Previous wording
As of March 31, 2026, we had $1.2 billion of operating and financing lease obligations, and for the twelve months ending March 31, 2027, we will be required to make approximately $192.2 million of cash lease payments in connection with our existing operating and financing leases.
Current wording
As of June 30, 2026, we had $1.2 billion of operating and financing lease obligations, and for the twelve months ending June 30, 2027, we will be required to make approximately $193.9 million of cash lease payments in connection with our existing operating and financing leases.
Previous wording
Total liquidity of $368.7 million as of March 31, 2026 included $265.2 million of unrestricted cash and cash equivalents (excluding restricted cash of $68.4 million), $4.9 million of marketable securities, and $98.6 million of availability on our secured credit facility. Subsequent to March 31, 2026, we completed the sale of three owned communities (545 units) for cash proceeds of $88 million, net of transaction costs, which further enhanced our liquidity subsequent to March 31, 2026.
Current wording
Total liquidity of $565.8 million as of June 30, 2026 included $370.4 million of unrestricted cash and cash equivalents (excluding restricted cash of $71.1 million), $19.9 million of marketable securities, and $175.6 million of availability on our secured credit facility. Total liquidity as of June 30, 2026 increased $188.2 million from December 31, 2025.
Previous wording
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.
Current wording
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, and continuing to evaluate our capital structure and the state of debt and equity markets. 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
Our actual liquidity and capital funding requirements depend on numerous factors, including our operating results, our actual level of capital expenditures, general economic conditions, and the cost of capital, as well as other factors described in "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission ("SEC") on February 19, 2026. Since the amount of mortgage financing available for our communities is generally dependent on their appraised values and performance, decreases in their appraised values, including due to adverse changes in real estate market conditions, or their performance, could result in available mortgage refinancing amounts that are less than the communities’ maturing indebtedness. In addition, our inability to satisfy underwriting criteria for individual communities may limit our access to our historical lending sources for such communities, including Fannie Mae and Freddie Mac. As of March 31, 2026, 11% of our owned communities were unencumbered by mortgage debt.
Current wording
Our actual liquidity and capital funding requirements depend on numerous factors, including our operating results, our actual level of capital expenditures, general economic conditions, and the cost of capital, as well as other factors described in "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission ("SEC") on February 19, 2026. Since the amount of mortgage financing available for our communities is generally dependent on their appraised values and performance, decreases in their appraised values, including due to adverse changes in real estate market conditions, or their performance, could result in available mortgage refinancing amounts that are less than the communities’ maturing indebtedness. In addition, our inability to satisfy underwriting criteria for individual communities may limit our access to our historical lending sources for such communities, including Fannie Mae and Freddie Mac. As of June 30, 2026, 9% of our owned communities were unencumbered by mortgage debt.
Previous wording
As of March 31, 2026, the current portion of long-term debt was $82.6 million, which includes $23.3 million of our 2.00% convertible senior notes due October 15, 2026 and $6.2 million of mortgage notes payable secured by assets held for sale. We have completed the refinancing of all of our mortgage debt maturities due in 2026. Our inability to obtain refinancing proceeds sufficient to cover 2027 and later maturing indebtedness could adversely impact our liquidity, and may cause us to seek additional alternative sources of financing, which may be less attractive or unavailable. Shortfalls in cash flows from estimated operating results or other principal sources of liquidity may have an adverse impact on our ability to fund our planned capital expenditures or to fund investments to support our strategy. In order to continue some of these activities at historical or planned levels, we may incur additional indebtedness or lease financing to provide additional funding. There can be no assurance that any such additional financing will be available or on terms that are acceptable to us.
Current wording
As of June 30, 2026, the current portion of long-term debt was $70.9 million, which includes $23.3 million of our 2.00% convertible senior notes due October 15, 2026. We have completed the refinancing of all of our mortgage debt maturities due in 2027. Our inability to obtain refinancing proceeds sufficient to cover 2028 and later maturing indebtedness could adversely impact our liquidity, and may cause us to seek additional alternative sources of financing, which may be less attractive or unavailable. Shortfalls in cash flows from estimated operating results or other principal sources of liquidity may have an adverse impact on our ability to fund our planned capital expenditures or to fund investments to support our strategy. In order to continue some of these activities at historical or planned levels, we may incur additional indebtedness or lease financing to provide additional funding. There can be no assurance that any such additional financing will be available or on terms that are acceptable to us.
Previous wording
Our capital expenditures for the three months ended March 31, 2026 are comprised of community-level and corporate capital expenditures. Community-level capital expenditures include maintenance expenditures (including routine maintenance of communities over $1,500 per occurrence), community renovations, unit upgrades (including unit turnovers over $500 per unit), and other major building infrastructure projects (including replacements of major building systems). Corporate capital expenditures include those for information technology systems and equipment and the remediation or replacement of assets as a result of casualty losses.
Current wording
Our capital expenditures for the six months ended June 30, 2026 are comprised of community-level and corporate capital expenditures. Community-level capital expenditures include maintenance expenditures (including routine maintenance of communities over $1,500 per occurrence), community renovations, unit upgrades (including unit turnovers over $500 per unit), and other major building infrastructure projects (including replacements of major building systems). Corporate capital expenditures include those for information technology systems and equipment and the remediation or replacement of assets as a result of casualty losses.
Previous wording
The following table summarizes our capital expenditures for the three months ended March 31, 2026 for our consolidated business.
Current wording
The following table summarizes our capital expenditures for the six months ended June 30, 2026 for our consolidated business.
Previous wording
(1)Reflects the amount invested, net of lessor reimbursements of $4.8 million.
Current wording
(1)Reflects the amount invested, net of lessor reimbursements of $14.3 million.
Previous wording
In December 2023, we amended our revolving credit agreement with Capital One, National Association, as administrative agent and lender and the other lenders from time to time parties thereto. The amended agreement provides an expanded commitment amount of up to $100.0 million which can be drawn in cash or as letters of credit. The credit facility matures in January 2027, and we have the option to extend the facility for two additional terms of approximately one year each subject to the satisfaction of certain conditions. We expect to satisfy the conditions to exercise the option to extend the facility for the first additional term. Amounts drawn under the facility will bear interest at the Secured Overnight Financing Rate ("SOFR") plus an applicable margin ranging from 2.5% to 3.0% based upon the percentage of the total commitment drawn. Additionally, a quarterly commitment fee of 0.35% per annum was applicable on the unused portion of the facility as of March 31, 2026. The revolving credit facility is currently secured by first priority mortgages and negative pledges on certain of our communities. Available capacity under the facility will vary from time to time based upon certain calculations related to the appraised value and performance of the communities securing the credit facility and the variable interest rate of the credit facility.
Current wording
In June 2026, we amended our revolving credit agreement with Capital One, National Association acting as administrative agent, and lender and the other lenders from time to time parties thereto. The amended agreement provides an expanded commitment of up to $200.0 million, representing up to a $100 million increase, which can be drawn in cash or as letters of credit. The credit facility matures in April 2029, and we have the option to extend the facility for two additional one-year terms, subject to the satisfaction of certain conditions. Amounts drawn under the facility bear interest at the Secured Overnight Financing Rate ("SOFR") plus an applicable margin ranging from 2.25% to 2.50% based upon the percentage of the total commitment drawn. Additionally, a quarterly commitment fee of 0.25% to 0.35% per annum is applicable based upon the percentage of the total commitment drawn. The revolving credit facility is currently secured by first priority mortgages and negative pledges on certain of our communities. Available capacity under the facility will vary from time to time based upon certain calculations related to the appraised value and performance of the communities securing the credit facility and the variable interest rate of the credit facility.
Previous wording
As of March 31, 2026, $1.4 million of letters of credit and no cash borrowings were outstanding under our $100.0 million secured credit facility and the facility had $98.6 million of availability. We also had separate letter of credit facilities providing up to $68.0 million of letters of credit as of March 31, 2026 under which $59.2 million had been issued as of that date.
Current wording
As of June 30, 2026, $23.0 million of borrowings and $1.4 million of letters of credit were outstanding under our $200.0 million secured credit facility, and the facility had $175.6 million of availability. We also had separate letter of credit facilities providing up to $68.0 million of letters of credit as of June 30, 2026 under which $54.1 million had been issued as of that date.
Previous wording
For the three months ended March 31, 2026, our cash lease payments for our operating leases were $46.5 million and for our financing leases were $2.0 million. For the twelve months ending March 31, 2027, we will be required to make approximately $192.2 million of cash lease payments in connection with our existing operating and financing leases.
Current wording
For the six months ended June 30, 2026, our cash lease payments for our operating leases were $95.1 million and for our financing leases were $4.2 million. For the twelve months ending June 30, 2027, we will be required to make approximately $193.9 million of cash lease payments in connection with our existing operating and financing leases.
Previous wording
Certain of our long-term debt and lease documents contain restrictions, maintenance and capital expenditure obligations, 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, 2026, our liquidity was $368.7 million.
Current wording
Certain of our long-term debt and lease documents contain restrictions, maintenance and capital expenditure obligations, 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 liquid assets of at least $130.0 million at each quarter-end determination date. As of June 30, 2026, our liquid assets were $390.3 million, which included $370.4 million of unrestricted cash and cash equivalents and $19.9 million of marketable securities.
Rearranged current paragraphs (16)
Current report — wording carried from elsewhere
Interest expense. The decrease in interest expense was primarily attributable to an increase in the fair value of interest rate derivatives in the current period and a decrease in interest expense on long-term debt primarily as a result of decreases in variable interest rate indices.
Current report — wording carried from elsewhere
The following table summarizes our overall operating results for the six months ended June 30, 2026 and 2025.
Current report — wording carried from elsewhere
The increase in Adjusted EBITDA was primarily attributable to an increase in same community resident fees, partially offset by an increase in same community 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, 2026 and 2025 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, 2026 and 2025, 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, 2026 and 2025, 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, 2026 and 2025, including operating results and data on a same community basis.
Current report — wording carried from elsewhere
The decrease in the segment's resident fees was primarily attributable to the disposition of communities since the beginning of the prior year period, which resulted in $26.0 million less in resident fees during the six months ended June 30, 2026 compared to the prior year period. The decrease was partially offset by an increase in the segment's same community RevPAR, comprised of a 210 basis point increase in same community weighted average occupancy and a 2.2% 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, and was partially offset by an occupancy mix shift to more independent living residents and lower skilled nursing occupancy.
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, 2026 and 2025.
Current report — wording carried from elsewhere
Reimbursed Costs Incurred on Behalf of Managed Communities and Costs Incurred on Behalf of Managed Communities. The decrease in reimbursed costs and costs incurred on behalf of managed communities was primarily attributable to terminations of management agreements subsequent to the beginning of the prior year period.
Current report — wording carried from elsewhere
General and Administrative Expense. The decrease in general and administrative expense was primarily attributable to $6.7 million of transaction costs for stockholder relations advisory matters in the prior year period and our efforts to reduce general and administrative expense as we scaled our general and administrative costs in connection with community dispositions. General and administrative expense includes transaction, legal, and organizational restructuring costs of $5.3 million and $12.2 million for the six months ended June 30, 2026 and 2025, 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
Facility Operating Lease Expense. The decrease in facility operating lease expense was primarily attributable to the termination of community leases subsequent to the prior year period.
Current report — wording carried from elsewhere
Depreciation and Amortization. The decrease in depreciation and amortization expense was primarily attributable to the disposition of communities since the beginning of the prior year period.
Current report — wording carried from elsewhere
Asset Impairment. The increase in asset impairment was primarily attributable to changes in estimates of fair value for certain communities planned for disposition.