Ventas, a Chicago-based healthcare real estate investment trust (REIT), reported a 19% increase in revenue in the first quarter of 2015, as it prepares to acquire a Nashville-based hospital operator and spin off its post-acute-and skilled-nursing portfolio.
The company, which owns more than 1,600 healthcare and senior housing properties across the U.S., reported net earnings of $120.4 million for the three months ended March 31, down 0.5% from the same period in the prior year.
Revenue increased 19.2% to $884 million for the quarter, but expenses also rose. Ventas reported $776.5 million in total expenses, up 25% from $621 million in the prior year's first quarter, in part because of costs related to its $2.6 billion acquisition of American Realty Capital Healthcare Trust last year, which was funded with stock, cash and debt assumption.
The acquisition of American Realty Capital made Ventas the largest healthcare REIT by market capitalization. Merger-related expenses and deal costs were about $35.2 million in Q1 2015, over three times higher than the same time the year before.
Same-store cash net operating income growth for the Ventas' entire portfolio was 3.2%, according to its earnings report.
Ventas made investments totaling $3.6 billion during the first quarter of 2015, including five care homes in the U.K., 12 skilled nursing facilities and development and redevelopment funding approximating $33.5 million.
Earlier this month the company announced that it plans to acquire Nashville-based Ardent Medical Services, a major for-profit hospital operator, for $1.75 billion. That deal, which will separate Ardent's hospital operations from its real estate holdings, is expected to close in mid-2015.
The REIT also said it would spin off its post-acute and skilled nursing portfolio into a publicly-traded REIT in the second quarter of this year.
