Ventas NYSE: VTR executives told investors the company delivered what CEO Deborah A. Cafaro described as an “outstanding year” in 2025, driven primarily by senior housing momentum under the company’s “1, 2, 3 strategy” focused on senior housing organic growth, value-creating investments, and portfolio cash flow. Management also raised its quarterly dividend and issued 2026 guidance calling for another year of strong growth led by its Senior Housing Operating Portfolio (SHOP).
2025 performance: SHOP-led growth and improved financial position
Cafaro said normalized FFO per share increased 9% in 2025, while same-store SHOP cash NOI grew 15%, marking the fourth consecutive year of double-digit SHOP NOI growth. She added that Ventas’ enterprise value exceeded $50 billion and that fourth-quarter annualized NOI and SHOP NOI were $2.5 billion and $1.3 billion, respectively. By year-end, Ventas owned more than 83,000 SHOP units, with 53% of NOI generated by SHOP communities.
On the SHOP operating side, Justin (management did not provide a last name in the transcript) said fourth-quarter same-store SHOP revenue grew more than 8%, supported by 300 basis points of occupancy growth year-over-year and 100 basis points sequentially. He said the U.S. portion of SHOP led with 370 basis points of occupancy growth year-over-year, aided particularly by independent living communities. Ventas’ communities in the U.S. top 99 markets outperformed NIC by 160 basis points, he said.
RevPOR increased 4.7% in the fourth quarter, even with the mix impact from strong occupancy gains in lower-priced independent living, while same-store SHOP NOI rose 15.4% year-over-year. Management cited margin expansion of 180 basis points to “over 28%,” driven by 50% incremental margin. Justin also highlighted full-year average occupancy growth of 280 basis points across the SHOP portfolio, led by 350 basis points in the U.S.
Demand and supply backdrop: “historic demographic inflection point”
Management repeatedly emphasized demographic tailwinds. Cafaro said 2026 represents “a historic demographic inflection point” as baby boomers begin turning 80, describing the cohort as nearly 70 million people and “the wealthiest generation ever.” She said the over-80 population is expected to grow 28% over the next five years and double over two decades.
At the same time, she said new supply remains constrained, citing about 2,500 new senior housing units started in the fourth quarter of 2025, versus an expectation that more than 2 million people will turn 80 in 2026.
Asked about the risk of new construction returning, Cafaro said development costs are high and that even if starts increase, Ventas expects demand growth to outweigh incremental new supply. Later, management said rents would need to rise substantially to support development, with Justin stating rents would need to be 20%–30% higher even at a relatively modest development yield.
Investments: acquisitions accelerate; pipeline described as “very active”
Cafaro said Ventas closed $2.5 billion of senior housing investments in 2025 and entered 2026 with an active pipeline. She said the company had already closed more than $800 million of senior housing acquisitions year to date and expressed confidence Ventas can complete $2.5 billion of investments focused on senior housing in 2026.
Justin said 2026 began with more than $800 million of wholly owned senior housing investments across seven transactions, bringing cumulative senior housing acquisitions to $4.8 billion in “a little over a year.” He noted half of the $800 million already completed in 2026 was sourced off-market, while marketed deals have become more competitive as capital flows into the sector. Still, he said Ventas’ scale, relationships, and track record help it win transactions, and he reiterated unlevered return targets described as “low double digit to mid-teens.”
In response to questions about valuations and cap rates, management acknowledged cap rates have drifted down and referenced disclosures showing acquisitions “under 7.” Justin said Ventas has been buying consistently at or below replacement cost, though some newer properties are closer to replacement cost depending on asset age.
2026 guidance: high single-digit FFO growth and another year of double-digit SHOP NOI gains
For 2026, Cafaro said Ventas expects high single-digit growth in normalized FFO per share, led by SHOP, and projected the total company same-store cash NOI growth to be “nearly 10%.” CFO Bob (management did not provide a last name in the transcript) provided more detailed guidance, forecasting normalized FFO per share of $3.78 to $3.88, with a midpoint of $3.83, representing 8% year-over-year growth on a comparable basis. He also guided to net income of $0.57 per share at the midpoint.
For SHOP, Justin guided to same-store NOI growth of 13% to 17% in 2026, driven by 270 basis points of occupancy growth and RevPOR growth of 5%. He said assumptions include in-house rent increases of 8% (up from 7% the prior year) and operating expense growth of 5% as occupancy rises, with modestly higher expenses in the first quarter reflecting recent severe weather.
Bob said the expected 2026 normalized FFO growth is driven by SHOP NOI growth and accretive investment activity, offset by the expiration of non-cash rental income from Brookdale and higher net interest expense from refinancing maturing debt. He said Ventas has $2.2 billion of debt maturing in 2026. In Q&A, Bob said those two items explain the difference between 8% and 10% growth.
By segment, Bob said 2026 same-store cash NOI growth expectations include:
- Total company same-store cash NOI: nearly 10% at the midpoint, led by SHOP at 15%
- Outpatient Medical and Research (OMR): 2.5% at the midpoint, led by outpatient medical
- Triple-net: “over 4%,” led by cash rent increases in January for Brookdale
In Q&A on triple-net growth, Bob said escalators are “more like 3% on average,” with January Brookdale increases described as outsized.
Capital, leverage, dividend, and reporting changes
Management said Ventas raised $7 billion of capital in 2025 from “a wide array of sources.” Bob said the company raised nearly $4 billion in bank, bond, and mortgage debt and issued $3.2 billion of equity, with $1.2 billion of unsettled equity available to fund future investments.
Bob said leverage improved to 5.2x in the fourth quarter, “the best it’s been since 2012,” and added that pro forma leverage for unsettled equity is approaching 5x, with expectations that leverage will continue to decline given the 2026 growth outlook.
The company also increased its dividend. Cafaro said the board approved an 8% increase in the quarterly dividend, citing performance and a positive multi-year outlook.
Additionally, Bob said that beginning in 2026, Ventas’ normalized FFO will exclude non-cash stock-based compensation expense. He stated the amount was $0.08 per share in both 2025 and 2026, and said the change is intended to align reporting with other healthcare REITs to improve comparability.
On expenses, Bob said cash G&A is expected to be in the “low $150 million range” in 2026, reflecting investment in the platform and asset management initiatives while remaining focused on efficiency.
About Ventas NYSE: VTR
Ventas, Inc NYSE: VTR is a real estate investment trust (REIT) that specializes in healthcare-related real estate. The company acquires, owns and manages a diversified portfolio of properties serving the healthcare continuum, including senior housing communities, skilled nursing facilities, medical office buildings, life science and research centers, and other properties leased to healthcare providers and operators. Ventas generates revenue through long-term leases, property management and selective development activities focused on meeting the real estate needs of the healthcare sector.
Ventas' business model combines property ownership with active asset management and capital markets activity.
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