Welltower Inc. (NYSE:WELL) Q4 2022 Earnings Call Transcript

Shankh Mitra: I’ll just add, Derek, one thing to that. Just as I mentioned before, we’re working towards regional density and going deep and not going broad with our existing partners, right? So, think about it, I don’t know, just — you will see the future is with our select operating partners, strategic partners, we’re going to have bigger density or higher density and a bigger scale in a market and with our investment in the technology platform and the operating platform with our operating partners, the ability to execute on the ground I think, again, this is going to be not only a great win for our owners, our assets, but also a great win for the select operated partners that we’ll choose to do business with going forward. So, it is a very much of a focus on win-win, and that’s the way business got to be.

Operator: We’ll take our next question from Michael Carroll at RBC Capital Markets.

Michael Carroll: How has Welltower’s relationship changed with its existing independent living operators since the PLR announcement? I mean, are they more willing to work with Welltower, given certain goals or targets, or has there been any noticeable change since that was announced?

Shankh Mitra: The forward thinking ones who are thinking about where the business needs to go 10 years from now, 5 years from now, 15 years from now, has come forward and want to participate in building out the platform together. The ones that are holding on to the notion of what the business was in the €˜90s are clearly realizing their future is not with us.

Operator: Next, we’ll go to Ronald Kamdem at Morgan Stanley.

Unidentified Analyst: Hey. Adam on for Ron. Good morning, guys. Just wanted to ask about the ProMedica, Integra assets. Wondering kind of with the new operators in place there for some of them, if you could kind of comment on the rent coverage, I’m not sure if it was in the supplemental. I know there’s some changes there in terms of the reporting structure. So I’d love to just hear about the rent coverage. I think it would be helpful for investors kind of given the kind of the prior history there.

John Burkart: Look, I think with the new operators, we’ve transitioned to at least 16 operators so far. And by the time the dust settles, it will be north of 20 operators. But all these transitions have happened over the last month, 1.5-month. So, it’s too soon to have numbers and performance conversations about their performance, but overall transitions have been smooth. And in the upcoming months, we’ll have better data to share on performance trends. But for now, the focus has been on getting the buildings in the right hands. And as you’ll see, with 16 to 20 operators that the focus has been very deep and very sharpshooter-esque where you want to find for every single asset, the right operator. So, that’s been the top priority so far.

Operator: We’ll go next to Steve Sakwa with Evercore ISI.