Ventas, Inc. · NYSE:VTR
Ventas — Citi 2024 Global Property CEO Conference
48 slides from Ventas's conference presentation, 2024
Slide 1: Citi 2024 Global Property CEO Conference
Citi 2024 Global Property CEO Conference
Slide 2: Non-GAAP Financial Measures & Cautionary Statements
Non-GAAP Financial Measures & Cautionary Statements Non-GAAP Financial Measures This presentation includes certain financial performance measures not defined by generally accepted accounting principles in the United States (“GAAP”), such as Nareit FFO, Normalized FFO, Net Operating Income (“NOI”), S
Slide 3: Table of Contents
Table of Contents 04 Ventas’s Strategy 34 Ventas Sustainability 11 Delivering Profitable 36 2023 Results & Full Organic Growth in Year 2024 Outlook Senior Housing 39 Appendix 23 Value-Creating External Growth Focused on Senior Housing 28 Drive Strong Execution and Cash Flow Generation Throughout The
Slide 4: Ventas's Strategy
4 Ventas’s Strategy
Slide 5: Ventas is a Leader in Real Estate
Ventas is a Leader in Real Estate Focused on serving a large and growing ~1,400 $34B +18% $1.80 aging population with an PROPERTIES1 ENTERPRISE VALUE2 ANNUALIZED TSR SINCE 20002 ANNUALIZED DIVIDEND PER emphasis on senior Including: Compared to: SHARE housing >800 12% Nareit HC REIT Index2 Senior Hou
Slide 6: Uniquely Positioned to Create Value
Uniquely Positioned to Create Value Leader in senior housing in North America Data-driven insights influencing with high-quality portfolio serving large asset performance, execution and and growing aging population market selection Attractive valuation and growth profile Strong operator relationship
Slide 7: We Are Executing a Focused Strategy to Drive Growth
We Are Executing a Focused Strategy to Drive Growth… 1. 2. 3. Deliver profitable Capture value-creating Drive strong execution organic growth in external growth focused and cash flow generation senior housing on senior housing throughout portfolio 7
Slide 8: …and Enhance Total Shareholder Returns
…and Enhance Total Shareholder Returns Drive enterprise NOI and normalized FFO per share growth Further enhance portfolio quality and operator diversification Increase SHOP scale Enable strong returns on capital Drive stable and growing dividend capacity 8
Slide 9: Ventas Has the Right Platform to Win
Ventas Has the Right Platform Operating Focus & Capabilities Data-Driven Insights Through to Win to Drive Value Creation Ventas OITM Ventas has the expertise, knowledge and relationships necessary to capture the unprecedented organic growth opportunity COMPETITIVE and capitalize on highly actionable
Slide 10: Robust Liquidity & Access to Capital
Robust Liquidity & Access to Capital Successful Canadian Bond Offering Access to Diverse Capital Sources Prefunds Select 2025 Maturities Provides Financial Flexibility $4.9B+ BBB+ Stable (S&P) Capital Third-Party (Ventas Investment of attractively priced capital raised Recycling Management) $650M CA
Slide 11: Delivering Profitable Organic Growth in Senior Housing
Delivering Profitable Organic Growth in Senior Housing 11
Slide 12: Ventas's Advantaged Senior Housing Portfolio Today
Ventas’s Advantaged Senior ~$100M Housing Portfolio Today TOTAL SHOP GAAP NOI GROWTH IN 2023 Top owner of real estate in the large and fragmented U.S. senior ~$120M housing market Our portfolio is positioned in markets with favorable demographics, strong net absorption and affordability TOTAL PROJEC
Slide 13: Strong SHOP Same-Store Performance in 2023, Led by U.S.
TOTAL SHOP NOI KEY COMMENTARY ▪ Full Year 2023 SHOP financial performance met or exceeded all same- store guidance metrics ▪ Full Year 2023 same-store cash NOI2 grew +18.3% YoY and Strong SHOP Same- $626.1 18.3% achieved margin expansion of +220 bp YoY Store Performance o Led by the U.S. which saw a
Slide 14: 2024 SHOP Same-Store Cash NOI Key Drivers
2024 SHOP Same-Store ▪ 2024 SHOP same-store cash NOI growth guidance range of 10% - 15% o U.S. expected to grow mid-to-high teens Cash NOI Key Drivers ▪ Expected 2024 average occupancy growth of +250bp YoY o U.S. average YoY occupancy growth of ~300bp, supported by a strong start February QTD, consi
Slide 15: Accelerating SHOP NOI Expected in 2024
Accelerating SHOP PRICE / VOLUME CAPITAL OPERATOR NOI Expected in 2024 OPTIMIZATION INVESTMENTS TRANSITIONS Driving durable occupancy- Demonstrating strong Right Market, Right Asset, led revenue growth returns Right OperatorTM Expected Exit Run Rate Strong Setup for 2025+ ▪ Ventas OITM with experien
Slide 16: Ventas SHOP Portfolio Driven by Growth in U.S. and Canada
Ventas SHOP Portfolio Expected to be Driven by Outstanding Growth in U.S. and Compounding Growth in Highly Occupied Canada Where We Are: SHOP MARKET SELECTION CRITERIA 491 24.5% Senior population growth & density TOTAL YoY SAME-STORE CASH NOI COMMUNITIES GROWTH RATE IN 2023 Wealth & affordability, i
Slide 17: Top Owner of U.S. Senior Housing Real Estate in a Large and Fragmented Market
5% 8% REIT Peer 2% Owner-Operator Top Owner of U.S. Senior Housing Real Estate in a Large and 1.8M Units1 Fragmented Market 85% U.S. Private-Pay Senior Housing Rest of Market 17 1. Company supplemental reports and 2023 ASHA Top Owners List
Slide 18: Ventas U.S. SHOP Markets Support Strong Net Absorption
Ventas U.S. SHOP NET ABSORPTION 1 Markets Support Strong Net Absorption & Occupancy Growth KEY HIGHLIGHTS: • Opportunity for significant upside, first back to pre- COVID occupancy then continued occupancy gains driven by expected outsized demand and low supply • Residents can afford to stay at Venta
Slide 19: U.S. SHOP Portfolio Has Favorable Key Quality Characteristics
U.S. SHOP Portfolio Has Favorable Key Quality Characteristics Median Household Income Median Home Value Median 75+ Net Worth $85,473 $87,237 $478,413 $476,517 $377,093 $376,039 WELL WELL WELL 4Q23 U.S. Same-Store RevPOR 80+ % Total Population 80+ Population Growth $5,586 $5,698 4.4% 4.3% 17.3% 18.0%
Slide 20: …And an Expanding SHOP Operator Footprint
…And an Expanding SHOP Operator Footprint U.S. SHOP Operators 22 OPERATOR SELECTION CRITERIA 11 Strong product-type acumen SHOP operators with market expertise and experience in the full spectrum of senior housing Strong leadership service offerings 2020 TODAY Financial strength Ventas and Operators
Slide 21: Ventas Operational Insights Platform
Ventas Operational InsightsTM RIGHT Platform MARKETS Proprietary data analytics and experiential insights platform drives portfolio actions and optimizes the right combination of markets, assets and operators Combines Ventas’s unmatched in-house operating expertise with data analytics capabilities t
Slide 22: Driving Performance With Ventas OI
Driving Performance With Ventas OITM VENTAS OITM 1 2 3 4 5 6 PLAYBOOK Identify Opportunity Right Operator Aligned Management Portfolio Actions NOI-Generating Value Creation DRIVES POSITIVE Agreement Capex OUTCOMES CASE STUDIES Sunrise Senior Living Case Study Operator Transitions f.k.a. “Transition
Slide 23: Value-Creating External Growth Focused on Senior Housing
Value-Creating External Growth 23 Focused on Senior Housing
Slide 24: Unprecedented Growth Opportunity Supported by Supply Demand Fundamentals
Unprecedented Growth Opportunity Supported by Supply Demand Fundamentals1,2,3 U.S. Senior Housing Multiyear Growth Opportunity Driven By Record Demand & Decelerating New Supply ACCELERATING DEMOGRAPHIC DEMAND FOR SENIOR HOUSING GFC Recovery Construction COVID & 800K Boom Recovery 70K U.S. 80+ popula
Slide 25: Now is the Right Time to Own and Acquire Senior Housing
Now is the Right Time to Attractive investor entry point given current valuations and as Ventas further aligns its portfolio with the growth opportunity. Own and Acquire Senior Housing RIGHT MARKETS RIGHT ASSETS RIGHT OPERATORSTM RIGHT TIME OUR FOCUSED STRATEGY Our Strategy will Enhance Total Shareh
Slide 26: Capital Markets Dislocation Causing Attractive Buying Opportunities
Capital Markets Dislocation Causing Attractive Buying Opportunities Entering the Peak Years for Senior Housing Loan Maturities 1 $12 ~$18 Billion Senior Housing Loan Ventas has an opportunity to acquire high- Maturities through 2025 quality senior housing assets with challenged $10 capital structure
Slide 27: Strong pipeline of high-quality senior housing acquisition opportunities in 2024
ACTIVELY EXECUTING ON HIGH-QUALITY, ATTRACTIVE SENIOR HOUSING ACQUISITIONS ACQUISITION STRATEGY ALIGNS WITH VENTAS’S STRENGTHS FINANCIALLY ATTRACTIVE TIME TO INVEST High Quality Submarkets with compelling supply / demand profile, Acquisition Pipeline with strong affordability and meaningful expected
Slide 28: Drive Strong Execution and Cash Flow Generation Throughout The Portfolio
Drive Strong Execution and Cash Flow 28 Generation Throughout The Portfolio
Slide 29: Demographic Tailwinds Fueling Demand Across Our Portfolio
Demographic Tailwinds Fueling Growth in the 65+ population drives: Demand Across Our Portfolio ✓ INCREASED DEMAND FOR OUTPATIENT MEDICAL CARE ✓ INCREASED NEED FOR R&D TO SUPPORT 65+ Population Growth Projections (2010 – 2030)1 DRUG INNOVATION 80M '20-'30 ▪ 11,200 people turn 65 each day; 4.1 million
Slide 30: Outpatient Medical and Research Assets Aligned Through Strong Institutional Demand
Outpatient Medical and Research Assets Aligned Through Strong Institutional Demand RESEARCH PORTFOLIO OUTPATIENT MEDICAL PORTFOLIO >17 ~71% ~14,000 >35 million top-tier research credit tenancy patient visits annually providers universities Cutting edge research to advance treatments Supporting natio
Slide 31: Leading National Outpatient Medical Platform
Leading National Outpatient Medical Platform Has Strong Performance Track Record and Significant Competitive Advantages Advantaged Locations With Strong Credit Tenants Ventas Has Favorable Tenant Specialty Mix1 % OF PHYSICIAN OCCUPIED 83% OM SQ. FT. 94% Strong Credit Primary Care Investment Grade 83
Slide 32: Nation's Leading Business at Intersection of Medicine, Research and Universities
Ventas Has Assembled the Nation’s Leading Business at the Intersection of Medicine, Research and Universities, Attracting Strong Demand to Create Vibrant Environments uCity Portfolio: Premier University-Based Life Science The Pearl: Atrium Health and Wake Forest Medical Research Ecosystem School in
Slide 33: Triple-Net Update
Triple-Net Update1 Triple-Net Portfolio NOI Composition (Totaling 100%) Senior Housing IRFs & LTAC Health Systems SNF International Hospital Brookdale Senior Housing Portfolio Kindred LTAC Portfolio ▪ 121 communities producing <8% of Ventas NOI with lease maturity of December 2025 ▪ Pursuant to the
Slide 34: Ventas Sustainability
34 Ventas Sustainability
Slide 35: Industry Leader in Sustainability Practices
Industry Leader in We believe strong environmental, social and governance practices are essential to delivering Sustainability Practices sustainable long-term outperformance for our investors and other stakeholders. SUSTAINABILITY HIGHLIGHTS1 OUR ESG PRIORITY AREAS EXECUTING ON 2040 NET ZERO EXCELLE
Slide 36: 2023 Results & Full Year 2024 Outlook
36 2023 Results & Full Year 2024 Outlook
Slide 37: Fourth Quarter + Full Year 2023 Financial Highlights
FOURTH QUARTER 2023 FINANCIAL RESULTS FULL YEAR 2023 FINANCIAL RESULTS ▪ Strong Fourth Quarter 2023 Normalized FFO per share of $0.76 ▪ Full Year 2023 Normalized FFO per share of $2.99 at the high end of the Fourth Quarter + Full o Increase of 7% excluding $0.02 per share benefit of promote revenue
Slide 38: Full Year 2024 Outlook
KEY GUIDANCE COMMENTARY Increase / (Decrease) to Normalized ▪ Strong organic property growth expected to continue in 2024 with FFO/sh. 2024 Guidance Midpoint vs. 2023 Normalized FFO per share growing 5% YoY at guidance midpoint of $3.13 ▪ The YoY increase of $0.14 per share at the midpoint of the 20
Slide 39: Appendix
39 Appendix
Slide 40: Non-GAAP Financial Measures Reconciliation
For the Three Months Ended December 31, 2023 September 30, 2023 Net loss $ (90,819) $ (71,124) Non-GAAP Adjustments: Financial Measures Interest 154,853 147,919 (Gain) loss on extinguishment of debt, net 85 612 Reconciliation Taxes (including tax amounts in general, administrative and professional f
Slide 41: Net Income to NOI – Trailing 5 Quarters Reconciliation
For the Three Months Ended For the Years Ended December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023 December 31, 2023 2022 2023 Net Income to NOI – Net (loss) income attributable to common stockholders $ (45,019) $ 17,517 $ 103,453 $ (71,124) $ (90,819) $ (47,447) $ (40,973) Trailing 5
Slide 42: Senior Housing Operating Portfolio Same-Store Cash NOI Reconciliations
Trailing 5-Quarter Comparison 4Q22 1Q23 2Q23 3Q23 4Q23 Total revenues $ 674,126 $ 704,993 $ 724,614 $ 754,417 $ 775,195 Senior Housing Adjustments: Operating Portfolio Revenues not included in cash operating revenues1 (18,315) (14,212) (11,823) (12,071) (12,648) Same-Store Cash Revenue impact from c
Slide 43: Outpatient Medical and Research Portfolio
Trailing 5-Quarter Comparison 4Q22 1Q23 2Q23 3Q23 4Q23 Total revenues $ 201,125 $ 203,632 $ 216,366 $ 226,988 $ 222,722 Outpatient Medical Adjustments: and Research Straight-lining of rental income (2,040) (2,345) (1,958) (2,350) (2,989) Portfolio Non-cash rental income (2,537) (2,573) (2,177) (2,48
Slide 44: Non-GAAP Financial Measures Reconciliation
For the Year Ended December 31, 2023 For the Year Ended December 31, 2022 SHOP OM&R SHOP OM&R Total revenues $ 2,959,219 $ 869,708 $ 2,651,886 $ 803,607 Non-GAAP Financial Measures Adjustments: Reconciliation Straight-lining of rental income — (9,642) — (9,499) Full Year 2023 Non-cash rental income
Slide 45: Non-GAAP Financial Measures Reconciliation
For the Three Months Ended December 31, 2023 For the Three Months Ended December 31, 2022 SHOP OM&R Triple-Net Non-Segment Total SHOP OM&R Triple-Net Non-Segment Total NOI $ 185,430 $ 147,945 $ 151,925 $ 3,801 $ 489,101 $ 152,654 $ 136,731 $ 143,129 $ 25,928 $ 458,442 Non-GAAP Financial Measures Adj
Slide 46: Non-GAAP Financial Measures Reconciliation
For the Year Ended December 31, 2023 For the Year Ended December 31, 2022 SHOP OM&R Triple-Net Non-Segment Total SHOP OM&R Triple-Net Non-Segment Total Non-GAAP NOI $ 711,407 $ 576,932 $ 604,651 $ 32,177 $ 1,925,167 $ 647,466 $ 546,604 $ 582,853 $ 65,717 $ 1,842,640 Financial Measures Adjustments: R
Slide 47: Non-GAAP Financial Measures Reconciliation
For the Year Ended December 31, 2024 SHOP OM&R Triple-Net Non-Segment Total High End Net income attributable to common stockholders $ 47 Non-GAAP Depreciation and amortization4 1,212 Interest expense, G&A, other income and expenses 5 806 Financial Measures NOI $ 847 $ 586 $ 606 $ 26 2,065 Reconcilia
Slide 48: FFO and FAD Reconciliation
Q4 YoY FY YoY For the Three Months Ended Change For the Twelve Months Ended Change December 31, December 31, 2023 2022 ’23-’22 2023 2022 ’23-’22 Net (loss) income attributable to common stockholders $ (90,819) $ (45,019) n/a $ (40,973) $ (47,447) 14% Net (loss) income attributable to common stockhol