Diversified Healthcare Trust · NASDAQ:DHC
Diversified Healthcare Trust — Q3 2022 Earnings Presentation
45 slides from Diversified Healthcare Trust's earnings presentation, Nov 2, 2022
Slide 1: Third Quarter 2022 Supplemental Operating and Financial Data
THIRD QUARTER 2022 Supplemental Operating and Financial Data ALL AMOUNTS IN THIS REPORT ARE UNAUDITED. Exhibit 99.25000 Marina Boulevard Brisbane, CA
Slide 2: Table of Contents
Supplemental Q3 2022 2 CORPORATE INFORMATION Company Profile ...............................................................................................................................................................................................................................................
Slide 3: Company Profile
Supplemental Q3 2022 3 The Company: Diversified Healthcare Trust, or DHC, we, our or us, is a real estate investment trust, or REIT, which owns healthcare related properties, including medical office and life science buildings, senior living communities and wellness centers located throughout the U.
Slide 4: Investor Information
Supplemental Q3 2022 4 Board of Trustees: John L. Harrington Lisa Harris Jones Daniel F. LePage Independent Trustee Lead Independent Trustee Independent Trustee David A. Pierce Jeffrey P. Somers Independent Trustee Independent Trustee Jennifer F. Francis Adam D. Portnoy Managing Trustee Chair of the
Slide 5: Research Coverage
Supplemental Q3 2022 5 Equity Research Coverage: B. Riley Securities, Inc. BofA Securities Colliers Securities LLC Bryan Maher Joshua Dennerlein David Toti (646) 885-5423 (646) 855-1681 (401) 488-4797 bmaher@brileyfin.com joshua.dennerlein@bofa.com david.toti@colliers.com JMP Securities RBC Capital
Slide 6: Key Financial Data
Supplemental Q3 2022 6 Key Financial Data RETURN TO TABLE OF CONTENTS As of and For the Three Months Ended 9/30/2022 6/30/2022 3/31/2022 12/31/2021 9/30/2021 Selected Balance Sheet Data: Total gross assets $ 7,857,421 $ 7,884,243 $ 8,465,059 $ 8,361,321 $ 8,907,220 Total assets $ 6,072,486 $ 6,145,8
Slide 7: Condensed Consolidated Balance Sheets
Supplemental Q3 2022 7 September 30, 2022 December 31, 2021 Assets Real estate properties: Land $ 668,908 $ 741,501 Buildings and improvements 5,927,958 6,072,055 Total real estate properties, gross 6,596,866 6,813,556 Accumulated depreciation (1,784,935) (1,737,807) Total real estate properties, ne
Slide 8: Condensed Consolidated Statements of Income (Loss)
Supplemental Q3 2022 8 For the Three Months Ended September 30, For the Nine Months Ended September 30, 2022 2021 2022 2021 Revenues: Rental income $ 63,960 $ 101,403 $ 191,767 $ 306,555 Residents fees and services 258,960 236,013 754,914 739,926 Total revenues 322,920 337,416 946,681 1,046,481 Expe
Slide 9: Statements of Income (Loss) (Additional Data)
Supplemental Q3 2022 9 For the Three Months Ended September 30, For the Nine Months Ended September 30, 2022 2021 2022 2021 Additional Data: General and administrative expenses / total assets (at end of period) 0.1 % 0.1 % 0.3 % 0.4 % Non-cash straight line rent adjustments included in rental income
Slide 10: Debt Summary
Supplemental Q3 2022 10 Coupon Interest Principal Maturity Due at Years to Rate Rate Balance Date Maturity Maturity Floating Rate Debt: Revolving credit facility (1) (2) 5.615% 5.615% $ 700,000 1/15/2024 $ 700,000 1.3 Weighted average rate / total floating rate debt 5.615% 5.615% $ 700,000 $ 700,000
Slide 11: Debt Maturity Schedule
Supplemental Q3 2022 11 $113,627 $586,373 $250,000 $500,000 $500,000 $1,100,000 $10,693 $16,413 $1,834 $2,001 $904 $302 $315 $330 $346 $7,624 Floating Rate Debt Unsecured Fixed Rate Debt Secured Fixed Rate Debt 2022 2023 2024 2025 2026 2027 2028 2029 2030 Thereafter $0 $200,000 $400,000 $600,000 $80
Slide 12: Leverage Ratios, Coverage Ratios and Public Debt Covenants
Supplemental Q3 2022 12 Leverage Ratios, Coverage Ratios and Public Debt Covenants RETURN TO TABLE OF CONTENTS As of and For the Three Months Ended 9/30/2022 6/30/2022 3/31/2022 12/31/2021 9/30/2021 Leverage Ratios: Net debt / total gross assets 29.2% 28.4% 25.2% 32.3% 39.8% Net debt / gross book va
Slide 13: Summary of Capital Expenditures
Supplemental Q3 2022 13 (dollars and sq. ft. in thousands, except per sq. ft. and unit data) Summary of Capital Expenditures RETURN TO TABLE OF CONTENTS For the Three Months Ended 9/30/2022 6/30/2022 3/31/2022 12/31/2021 9/30/2021 Office Portfolio lease related costs $ 4,277 $ 4,633 $ 6,759 $ 15,941
Slide 14: Office Portfolio Redevelopment Information
Supplemental Q3 2022 14 Project Location Type of Property Square Feet (1) Estimated Project Costs Total Costs Incurred as of September 30, 2022 Estimated Completion Date 101 West Ponce De Leon Avenue Decatur, GA Medical Office 112,440 $ 8.6 $ 7.9 Q4 2022 1415 West 3rd Street Tempe, AZ Life Science 8
Slide 15: Property Acquisitions / Dispositions Information
Supplemental Q3 2022 15 Property Acquisitions / Dispositions Information Since January 1, 2022 Acquisitions: Date Acquired Location Type of Property Number of Properties Sq. Ft. Gross Purchase Price Gross Purchase Price per Sq. Ft. Cap Rate (1) Weighted Average Remaining Lease Term (2) Occupancy (3)
Slide 16: Investments in Unconsolidated Joint Ventures
Supplemental Q3 2022 16 Investments in Unconsolidated Joint Ventures (1) (dollars in thousands) RETURN TO TABLE OF CONTENTS As of September 30, 2022 Nine Months Ended September 30, 2022 Joint Venture Location Type of Property Number of Properties Square Feet Occupancy at September 30, 2022 Weighted
Slide 17: Investments in Unconsolidated Joint Ventures (continued)
Supplemental Q3 2022 17 Investments in Unconsolidated Joint Ventures (continued) (1) (dollars in thousands) RETURN TO TABLE OF CONTENTS As of September 30, 2022 (1) Our property list, including properties owned by these unconsolidated joint ventures, is available on our website. (2) Based on the agg
Slide 18: Calculation and Reconciliation of NOI and Cash Basis NOI
Supplemental Q3 2022 18 Calculation and Reconciliation of NOI and Cash Basis NOI (dollars in thousands) RETURN TO TABLE OF CONTENTS For the Three Months Ended For the Nine Months Ended 9/30/2022 6/30/2022 3/31/2022 12/31/2021 9/30/2021 9/30/2022 9/30/2021 Calculation of NOI and Cash Basis NOI: Reven
Slide 19: NOI and Cash Basis NOI
Supplemental Q3 2022 19 For the Three Months Ended For the Nine Months Ended 9/30/2022 9/30/2021 % Change 9/30/2022 9/30/2021 % Change NOI: Life Science $ 10,115 $ 29,781 (66.0) % $ 26,894 $ 93,837 (71.3) % Medical Office 20,960 29,353 (28.6) % 66,315 88,810 (25.3) % Total Office Portfolio 31,075 59
Slide 20: Same Property NOI and Cash Basis NOI
Supplemental Q3 2022 20 Same Property NOI and Cash Basis NOI (dollars in thousands) RETURN TO TABLE OF CONTENTS For the Three Months Ended For the Nine Months Ended 9/30/2022 9/30/2021 % Change 9/30/2022 9/30/2021 % Change NOI: Life Science $ 6,927 $ 5,930 16.8 % $ 19,919 $ 19,481 2.2 % Medical Offi
Slide 21: NOI Reconciliation by Segment: Office Portfolio
Supplemental Q3 2022 21 Calculation and Reconciliation of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI by Segment RETURN TO TABLE OF CONTENTS (dollars in thousands) Office Portfolio For the Three Months Ended Calculation of NOI and Cash Basis NOI: 9/30/2022 6/30/2022 3/31/
Slide 22: NOI Reconciliation by Segment: SHOP
Supplemental Q3 2022 22 Calculation and Reconciliation of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI by Segment (continued) RETURN TO TABLE OF CONTENTS (dollars in thousands) SHOP For the Three Months Ended Calculation of NOI and Cash Basis NOI: 9/30/2022 6/30/2022 3/31/
Slide 23: NOI Reconciliation by Segment: Non-Segment
Supplemental Q3 2022 23 Calculation and Reconciliation of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI by Segment (continued) RETURN TO TABLE OF CONTENTS (dollars in thousands) Non-Segment For the Three Months Ended Calculation of NOI and Cash Basis NOI: 9/30/2022 6/30/202
Slide 24: NOI Reconciliation by Segment: Consolidated
Supplemental Q3 2022 24 Calculation and Reconciliation of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI by Segment (continued) RETURN TO TABLE OF CONTENTS (dollars in thousands) Consolidated For the Three Months Ended Calculation of NOI and Cash Basis NOI: 9/30/2022 6/30/20
Slide 25: Reconciliation of EBITDA, EBITDAre and Adjusted EBITDAre
Supplemental Q3 2022 25 Calculation and Reconciliation of EBITDA, EBITDAre and Adjusted EBITDAre (dollars in thousands) For the Three Months Ended For the Nine Months Ended 9/30/2022 6/30/2022 3/31/2022 12/31/2021 9/30/2021 9/30/2022 9/30/2021 Net (loss) income $ (81,492) $ (109,383) $ 240,423 $ 366
Slide 26: Reconciliation of FFO and Normalized FFO
Supplemental Q3 2022 26 Calculation and Reconciliation of FFO and Normalized FFO Attributable to Common Shareholders (amounts in thousands, except per share data) RETURN TO TABLE OF CONTENTS For the Three Months Ended For the Nine Months Ended 9/30/2022 6/30/2022 3/31/2022 12/31/2021 9/30/2021 9/30/
Slide 27: Portfolio Summary by Geographic Diversification and Property Type
Supplemental Q3 2022 27 FL: 10% CA: 9% TX: 9% GA: 6% MD: 5% NC: 4% WI: 4% VA: 4% IL: 4% IN: 4% 26 Other States + D.C.: 41% (based on Gross Book Value of Real Estate Assets as of September 30, 2022) (1) Senior living communities are categorized by the type of living units which constitute a majority
Slide 28: Portfolio Summary
Supplemental Q3 2022 28 Portfolio Summary RETURN TO TABLE OF CONTENTS (dollars in thousands, except investment per square foot or unit) As of September 30, 2022 Number of Properties Square Feet or Number of Units Gross Book Value of Real Estate Assets % of Total Gross Book Value of Real Estate Asset
Slide 29: SHOP Unit Count
Supplemental Q3 2022 29 SHOP Unit Count Assisted Living units: 10,479: 42% Independent Living and Active Adult units: 10,416: 42% SNF units: 1,394: 5% Memory Care units: 2,789: 11% RETURN TO TABLE OF CONTENTS SHOP Unit Count as of September 30, 2022 Assisted Living units: 6,486: 36% Independent Livi
Slide 30: Rent Coverage and Occupancy
Supplemental Q3 2022 30 Rent Coverage and Occupancy Rent Coverage (1): For the Twelve Months Ended 6/30/2022 3/31/2022 12/31/2021 9/30/2021 6/30/2021 Triple net leased senior living communities 1.17 x 1.18 x 1.21 x 1.21 x 1.27 x Wellness centers (2) 1.72 x 1.59 x 1.68 x 1.60 x 1.51 x Total 1.30 x 1.
Slide 31: Office Portfolio - Results of Operations
Supplemental Q3 2022 31RETURN TO TABLE OF CONTENTS OFFICE PORTFOLIO - RESULTS OF OPERATIONS (dollars and sq. ft. in thousands) As of and For the Three Months Ended September 30, 2022 As of and For the Three Months Ended September 30, 2021 Life Science Medical Office Total Office Portfolio Life Scien
Slide 32: Office Portfolio and Same Property - Results of Operations (continued)
Supplemental Q3 2022 32 Office Portfolio and Same Property - Results of Operations (continued) RETURN TO TABLE OF CONTENTS OFFICE PORTFOLIO - RESULTS OF OPERATIONS (dollars and sq. ft. in thousands) As of and For the Nine Months Ended September 30, 2022 As of and For the Nine Months Ended September
Slide 33: Office Portfolio - Results of Operations
Supplemental Q3 2022 33 (1) Same property includes those properties classified as same property for the three months ended September 30, 2022 for all periods presented. RETURN TO TABLE OF CONTENTS OFFICE PORTFOLIO - RESULTS OF OPERATIONS (dollars and sq. ft. in thousands) As of and For the Three Mon
Slide 34: SHOP Segment and Same Property - Results of Operations
Supplemental Q3 2022 34 SHOP Segment and Same Property - Results of Operations RETURN TO TABLE OF CONTENTS SHOP SEGMENT - RESULTS OF OPERATIONS (dollars in thousands, except average monthly rate) As of and For the Three Months Ended 9/30/2022 6/30/2022 3/31/2022 12/31/2021 9/30/2021 Number of Proper
Slide 35: SHOP Segment - Results of Operations
Supplemental Q3 2022 35RETURN TO TABLE OF CONTENTS SHOP SEGMENT - RESULTS OF OPERATIONS (dollars in thousands, except average monthly rate) As of and For the Three Months Ended September 30, 2022 As of and For the Three Months Ended September 30, 2021 Five Star Managed Communities Other Operator Man
Slide 36: SHOP Segment - Results of Operations (Nine Months)
Supplemental Q3 2022 36RETURN TO TABLE OF CONTENTS SHOP SEGMENT - RESULTS OF OPERATIONS (dollars in thousands, except average monthly rate) As of and For the Nine Months Ended September 30, 2022 As of and For the Nine Months Ended September 30, 2021 Five Star Managed Communities Other Operator Manag
Slide 37: Office Portfolio Leasing Summary
Supplemental Q3 2022 37 Office Portfolio Leasing Summary (1) (2) (1) The leasing summary on this page is based on leases entered into during the periods indicated. (2) Effective as of the date of deconsolidation, excludes properties owned by the unconsolidated joint ventures in which we own an equit
Slide 38: Tenants Representing 1% Or More of Total Annualized Rental Income
Supplemental Q3 2022 38 As of September 30, 2022 Tenants Representing 1% Or More of Total Annualized Rental Income RETURN TO TABLE OF CONTENTS (dollars in thousands) Tenant Facility Type Annualized Rental Income % of Annualized Rental Income Expiration 1 Advocate Aurora Health Medical office $ 16,93
Slide 39: Office Portfolio Lease Expiration Schedule
Supplemental Q3 2022 39 Office Portfolio Lease Expiration Schedule RETURN TO TABLE OF CONTENTS (dollars in thousands) As of September 30, 2022 Office Portfolio Annualized Rental Income Expiring Year Annualized Rental Income Expiring % of Total Annualized Rental Income Expiring Cumulative % of Total
Slide 40: Non-Segment Lease Expiration Schedule
Supplemental Q3 2022 40 Non-Segment Annualized Rental Income Expiring Year Number of Properties Number of Units or Square Feet Annualized Rental Income Expiring % of Total Annualized Rental Income Expiring Cumulative % of Total Annualized Rental Income Expiring 2022 — — $ — —% —% 2023 — — — —% —% 20
Slide 41: Non-GAAP Financial Measures
Supplemental Q3 2022 41 Non-GAAP Financial Measures We present certain "non-GAAP financial measures" within the meaning of applicable rules of the SEC, including net operating income, or NOI, Cash Basis NOI, same property NOI, same property Cash Basis NOI, earnings before interest, income tax, depre
Slide 42: Definitions: Adjusted Total Assets, Annualized Rental Income
Supplemental Q3 2022 42 Adjusted total assets Adjusted total assets is the original cost of real estate assets calculated in accordance with GAAP before depreciation and after impairment write downs, if any, and excludes accounts receivable and intangible assets. AlerisLife AlerisLife means AlerisLi
Slide 43: Definitions: GAAP, Gross Book Value
Supplemental Q3 2022 43 GAAP GAAP is U.S. generally accepted accounting principles. Gross book value of real estate assets Gross book value of real estate assets is real estate assets at cost plus certain acquisition costs, before depreciation and purchase price allocations, less impairment writedow
Slide 44: Definitions: Office Portfolio and Other Terms
Supplemental Q3 2022 44 Office Portfolio Office Portfolio consists of medical office properties leased to medical providers and other medical related businesses, as well as life science properties leased to biotech laboratories and other similar tenants. Our medical office and life science property
Slide 45: Warning Concerning Forward-Looking Statements
Supplemental Q3 2022 45 This presentation of supplemental operating and financial data may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. Whenever we use words such as “believe”, “expect”, “anticipate”, “intend
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