Justin Hutchens: That’s great. And it all starts with the macro for sure. And then within that, we’ve been working for quite some time to make sure we’re well positioned to take advantage of this great opportunity. A couple of examples. One is just price volume optimization, and this is really the opportunity to ensure that we really — we maintain our market position. A good example would be Sunrise and Atria, which are well invested, well established operators in local markets. And as we adjust pricing over time, we want to make sure that we’re maintaining the relative position in the market. We back tested this, and over the past year, we’ve had big increases in average move-ins in those companies. And then there’s other examples.
[Indiscernible] jumps out to me as one where we made — we took actions to invest in the properties and put the new operator in place. And then we’ve tracked the performance relative to market and they’re outperforming market. And so that’s an opportunity. The overall CapEx investment we highlighted in our earnings deck where we’ve had year-over-year growth of 470 basis points of occupancy and a street rate growth of over 9%. So it’s a combination of a lot of activity and actions and helping to give our operators some strategic support as they do the great job of executing on a day-to-day basis.
Joshua Dennerlein: On a different note, you guys have the Brookdale warrants. I know they’re exercisable through year-end 2025. Just how are you guys thinking about essentially exercising those? I know they’re really in the money, which is how do you think about using those as a potential source of capital?
Robert Probst: Yes, I’ll take that one. You’re right. We have 16 million warrants at $3 a share. So clearly deeply in the money. And that is, again, another source of funds as we think about the opportunity to both create value recognized gains and invest behind senior housing real estate. And obviously, about 1.5 years left in terms of duration, but a clear opportunity.
Joshua Dennerlein: Thanks for the time.
Operator: Your next question comes from the line of Nick Yulico of Scotiabank. Please go ahead.
Nicholas Yulico: Thanks, good morning everyone. Maybe just a bigger picture question on kind of the focus for the company right now in terms of — there is a lot of opportunity to invest in seniors housing. If we fast forward a year from now, is Ventas going to be a larger company, more assets owned, higher senior housing exposure. How should we think about that sort of investment pipeline, how you could capitalize on it? Because I think year-to-date or what’s in the pipeline is somewhat neutral. You have acquisitions, dispositions roughly matched. How do you think about sort of growing the portfolio right now?
Debra Cafaro: Yes. I mean, we’re — again, we’re executing on the strategy. The driver of organic growth is obviously driving the bus. We’re going to as the second largest owner of senior housing with the platform that we have and access to capital, we’re layering on external growth focused on senior housing that part of the portfolio is definitely going to grow. And we’re committed to taking advantage of this multiyear opportunity and the kind of returns that we’re seeing in the market for good assets at high yields with high growth potential, we are going to find a way to make those acquisitions and make senior housing a larger part of our overall portfolio. I mean it’s already over half with job at 40% and growing. And I think you’re going to see those trends continue.
Nicholas Yulico: Okay, thanks Debbie. Second question is just I know you have the slide in there again on the attractive time to invest in senior housing. And talks about year 1 FFO per share neutral/accretive for the investments, realizing that, obviously, there’s a long runway here when you’re thinking in the long-term. But how should we think about your focus on — at what point is it year 2? How should we think about accretion happening because obviously, earnings growth is important, people focus on that. Thanks.
Debra Cafaro: Definitely. And we are, too. Bob?
Robert Probst: I think going in yields relative to cost of capital, roughly neutral, so not in the immediately accretive. But I would point you to the IRRs and the growth potential in these investments, mid-teens and an example used. That says there’s attractive growth in the near term, which would drive accretion.
Debra Cafaro: Yes.
Robert Probst: And that’s what’s so exciting to us.
Debra Cafaro: And it would be near-term accretion.
Robert Probst: Near term.
Nicholas Yulico: Alright. Thanks Deb.
Debra Cafaro: Thank you.
Operator: Your next question comes from the line of Vikram Malhotra of Mizuho. Please go ahead.
Vikram Malhotra: Good morning. Congrats on a strong quarter. Just two questions. Maybe Justin one for you. I guess I wanted to be clear, the acceleration trends you’ve mentioned last quarter and at prior conferences in SHOP. Is that occupancy? Or is that same-store NOI growth as you go through the year? Because you had a really strong 1Q, but the midpoint of the guide still suggests some decel through the year. I know you’re being conservative, but I just want to understand the mechanics behind. Is it occupancy acceleration or SHOP acceleration or both?
Justin Hutchens: Well, first of all, occupancy is accelerating. It’s been underway, and that’s part of the guidance expectations that we gave. Good point. We had a real strong start to the first quarter from an NOI standpoint. So that kind of changes the trajectory of what we’re expecting in terms of stepping up throughout the year. And also another good point, key selling season starts right now. So we’ll give ourselves time to see how that plays out and go from there.
Vikram Malhotra: So just to clarify, are you still, like you said last quarter, just I want to make sure, is it same-store NOI growth acceleration? Or is it the occupancy acceleration. You just said the trajectory change, but are you still anticipating accelerating same-store NOI growth?
Robert Probst: Yes. I would point you to, first off, occupancy. We posted 240 so far year-to-date. We’ve got 270 year-over-year. So clearly there’s going to be incremental year-over-year occupancy growth embedded in the forecast. Our range has gone up at the midpoint to 14% on NOI. We posted 15% in the first quarter, pretty close. I think we keep coming back to this key selling season notion. We’re just starting that. We want to see how that one plays out.
Vikram Malhotra: Got it. Okay. And then Debbie, if I don’t know if you can maybe throw us some more tea leaves here just on the Kindred outcome. I guess, is it fair to assume the fact that you’ve extended by 1 month, and you’ve mentioned there are potentially other parties. It’s unlikely that — or it’s more likely that Kindred is part of the solution, meaning it’s like an all renewal or partial with other players and them just not renewing at all is off the table, just given the fact that you extended it by another month.
