2024 was a year of “occupancy outperformance” for Ventas, with year-over-year occupancy in the Chicago-based real estate investment trust’s senior housing operating portfolio, or SHOP, increasing 300 basis points in its same-store communities, Chairman and CEO Debra Cafaro said Thursday during a fourth-quarter and full-year 2024 earnings call.

US same-store average occupancy grew 360 basis points for the year, with assisted living increasing 390 basis points and independent living increasing by 300 basis points. By comparison, Canadian same-store average occupancy grew 170 basis points year over year to a record 96%. Overall, SHOP same-store occupancy for the full year grew to 86.4% and increased 370 basis points for the fourth quarter. 

January occupancy is off to a “strong start,” Executive Vice President, Senior Housing and Chief Investment Officer Justin Hutchens said, and occupancy is projected to increase 270 basis points in the REIT’s SHOP over the course of the year. 

“We are outperforming our markets in occupancy growth,” he said. “Moving forward, we are highly optimistic about our senior housing business across multiple dimensions. The supply and demand dynamics in our sector are exceptionally favorable.”

Meanwhile, Hutchens added, inventory growth is at the lowest point on record, and new construction starts also are at an all-time low.

“These combined factors create an extraordinary net absorption opportunity in the upcoming years, unlike anything we have seen before,” he said. “Ventas is in a strong position to continue to drive growth in our SHOP portfolio.” 

Last year, the REIT completed more than $2 billion in investments ($1.4 billion alone in the fourth quarter) focused on senior housing, and it has “line of sight” on $1 billion in senior housing investments that are expected to close in the first half of the year

The company also increased assets under management in its Ventas Investment Management platform to more than $5 billion.

“Looking forward, we are excited about the opportunities ahead,” Cafaro said. “To create value for stockholders, we intend to continue to drive SHOP growth and expand our SHOP footprint with accretive investments focused on senior housing. As a result, we expect our SHOP business to represent over 50% of our [net opening income] by year-end.”

The company reported that it had completed 228 “refresh” projects in 2024 by the end of the year, including more than 150 employee breakrooms and more than 4,500 resident units. Hutchens said that the company is on pace to complete another 50 such projects by the key selling season this year. 

The REIT also said it expanded its SHOP by converting 45 Brookdale Senior Living communities from triple-net leases to SHOP properties last year, repositioning low-occupancy communities under five existing operators and increasing its SHOP footprint by 8%. Hutchens said the company plans to execute the Ventas OI (Operational Insights) data and analytics platform to improve occupancy, pricing and the environment this year.

Cafaro said the REIT still is in the early stages of realizing a multiyear growth opportunity in senior living as the older adult population grows, construction starts remain at historic lows and new developments are not feasible. The firm expects to continue to benefit from compelling demand, a favorable pricing environment and robust investment opportunities, she said.

“We are optimistic about 2025 and beyond,” Cafaro said. “Conditions remain favorable for our continued success, and the company continues to build its competitive advantages. We are in it to win it.”