![]() SP NOI growth accelerated with a 7.7% improvement Q1 2023 from Q1 2022 on improved occupancy, higher rents. In Q1 2023, average same property occupancy was 78.5% compared to 77.1% in Q1 2022, an improvement of 1.4%. Recent ResultsĬhartwell is making slow but determined progress to restoring its occupancy levels. These industry dynamics set Chartwell up for both strong organic growth and opportunities to capture additional market share. Chartwell, as the dominant player in the industry can benefit from a first–mover advantage in consolidating smaller operators. This leaves room for considerable consolidation across the sector. Within the Seniors Housing industry, the top 20 largest operators account for approximately 30% of units. With new supply growth to lag population growth, the industry will experience strong demand and corresponding pricing strength. The 80+ population in Canada is forecast to grow at a compound annual rate of 4.1% from 2023 to 2045. While occupancy is currently low, construction starts as a % of inventory are 2.2%, well below pre-pandemic levels. According to a 2023 Cushman & Wakefield Report, occupancy recovery to pre-pandemic levels is not expected until 2025. Across the industry, occupancy levels dropped dramatically from pre-pandemic levels. Despite these constructive demand dynamics, the sector is still recovering from COVID-19. An aging population in Canada and an under supply of high quality purpose-built seniors properties has led to strong pricing power. The Seniors Housing segment of the Canadian REIT space benefits from strong supply and demand fundamentals. Chartwell trades on the TSX under the symbol “CSH-UN.TO” with daily average volume of 480,000 units. Established in 2003 and headquartered in Missisauga, Ontario, Chartwell has a market capitalization of $2.2B and an enterprise value of $4.5B. ( EXE:CA) and Sienna Senior Living ( SIA:CA), Chartwell is one of three publicly traded Seniors Housing REITs on the Toronto Stock Exchange. With approximately 26,500 retirement units and 3,320 long-term care beds across 192 properties, Chartwell is by far the largest seniors housing operator in Canada.Ĭhartwell Retirement Residences Portfolio (Chartwell Retirement Residences )Īlong with Extendicare Inc. The properties are concentrated in Canada’s four most populous provinces, Ontario, Quebec, British Columbia, and Alberta. Company ProfileĬhartwell owns a portfolio of partial and full ownership seniors housing communities This portfolio includes independent living retirement to supported living facilities across Canada. I don't expect a quick improvement for Chartwell however, I see a good entry point and an attractive yield at current levels. This is an opportunity to own a market leader making gradual operational improvements in a challenging sector. With a beat-up unit price, Chartwell is currently yielding 6.6%. Constructive demographic trends and low levels of new inventory are forces that set up a strong demand paradigm over the medium term. Catalysts to support this turnaround include the disposition of the REIT’s long-term care operations and the continual improvement in occupancy. ![]() The REIT’s goal is to recover and surpass its pre-2019 occupancy levels by 2025. Investment ThesisĬhartwell Retirement Residences ( TSX: CSH.UN:CA) has struggled with a slow post-pandemic recovery. Author's Note: All funds in Canadian currency unless otherwise noted.
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