Omega Healthcare Investors, Inc. (NYSE:OHI) Q1 2024 Earnings Call Transcript

Alex Fagan: Got it. That’s all for me. Thank you.

Operator: Our next question is in the line of Emily Meckler with Green Street. Please proceed with your questions.

Emily Meckler: Yes, just kind of following up on that. I know it’s early, but do you anticipate dislocation in property types, particularly in more rural areas in the coming months due to an overhang of uncertainty on the staffing mandate?

Megan Krull: Can you repeat that?

Emily Meckler: Yes, just I was wondering if you guys anticipate dislocation in property values, particularly in the more rural areas in the coming months due to an overhang of uncertainty on the staffing mandate.

Taylor Pickett: I don’t know that we’ll see a dislocation in pricing until at least after the election, because people are just waiting to see where the politics and policy and legislation play out around the rule. And remember, there is — there are rule carve-out exceptions that we don’t even fully know mechanically how they’re going to work. So, I don’t think you’ll see pricing dislocation now. If we’re still sitting here a year from now with the same pattern we have today, then maybe you start to see it at that point.

Emily Meckler: Okay, great. And then, Megan, just one follow-up for you, what are the main drivers of the abnormally large staffing issues in Texas? Are these staffing issues primarily responsible for the lagging occupancy gains relative to the other markets? Or is there something that might be fundamentally challenged in that state?

Megan Krull: I mean, look, Texas has a lot of very rural areas, right? And so you have very small towns where it’s not easy to go pick up stuff from the neighboring town. You’re really relying on your local market. So, that plays into it. It’s very wide and vast.

Operator: Thank you. [Operator Instructions] Thank you. At this time, I will now turn the conference back to Taylor Pickett for closing comments.

Taylor Pickett: Thanks for joining our call this morning. As always, the team is prepared for any follow-up questions. Have a great day.

Operator: This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.