Brookdale Senior Living (BKD) 2026 Jefferies Healthcare Services and Technology Conference summary

Industry dynamics and market trends

• Supply-demand imbalance persists, with occupancy growth seen across the sector and specific markets reaching 90–95%+ occupancy, limiting new supply due to high construction and labor costs.

• New development is constrained by high material, labor, and borrowing costs, with existing communities often trading below replacement cost, discouraging new builds.

• Aging population (80+ years) is growing at a 5% CAGR, further intensifying demand for senior living.

• In some markets, senior living supply is shrinking as properties are repurposed for other uses.

• Rate increases are now decoupled from Social Security COLA, with pricing power driven by occupancy and market dynamics.

Organizational and operational changes

• Leadership overhaul included a new CEO, COO, and Chief Sales Officer, with a focus on operational alignment and accountability.

• Business was streamlined by divesting over 100 communities, aligning operations, sales, and clinical functions under unified leadership.

• New sales leadership emphasizes action-oriented strategies, energizing all staff to participate in sales activities and driving occupancy growth.

• Organizational structure now features a single line of accountability from CEO to community level, improving empowerment and efficiency.

• Expense management initiatives include labor optimization and cost controls on food and maintenance.

Financial performance and guidance

• Full-year guidance reaffirmed, targeting 8–9% RevPAR growth and stable EBITDA despite slower-than-expected occupancy gains in early quarters.

• Expense discipline and operational improvements are expected to support margin expansion in the second half of the year.

• Corporate G&A and field leadership structures are set, with no significant changes anticipated as divestitures conclude.

• Disposition program of underperforming assets is nearly complete, with most sales expected by Q3 and minimal drag anticipated going forward.

• Occupancy gains and rate increases are projected to drive significant NOI and free cash flow growth over the next several years.