Company Overview

Healthcare Trust of America, Inc. (HTA) is a real estate investment trust that owns medical office buildings and seniors housing facilities across the United States. As of March 31, 2024, HTA owned 160 medical office buildings and 48 seniors housing facilities, for a total of 208 properties.

HTA calculates an estimated value per share based on appraisals of its properties. As of December 31, 2023 this value was $13.00 per share, down from $14.00 at the end of 2022. The value per share decreases when HTA issues stock dividends instead of cash dividends.

Financial Performance

In the first quarter of 2024, HTA had a net loss of $15.6 million compared to a net loss of $14.1 million in the first quarter of 2023. This was driven by higher operating expenses, mainly increased labor costs, property insurance, and interest expense.

HTA’s medical office building business has been more stable than its seniors housing business during the COVID-19 pandemic. Seniors housing faced challenges with lower occupancy rates and higher operating expenses.

Revenue and Occupancy Trends

Segment	Q1 2024 Revenue	Q1 2024 Occupancy
Medical Office Buildings	$34.6 million	90.5%
Seniors Housing	$53.7 million	75.3%

Seniors housing occupancy dropped during the pandemic but has partially recovered. It was 85.1% at the end of 2019 compared to 75.3% at the end of Q1 2024. Higher labor costs have offset increased resident fees.

Expenses

Key operating expenses in Q1 2024 vs Q1 2023:

• Property operating expenses: Up $1.3 million
• Impairment charges: $0.3 million vs $0
• Interest expense: Up $0.6 million

Increases were driven by inflation, higher insurance and interest rates, and ongoing supply chain and labor challenges.

Cash Flow and Liquidity

At March 31, 2024, HTA had:

• Cash and cash equivalents: $28.7 million
• Total debt: $1.2 billion
  
• Weighted average interest rate: 5.6%

HTA expects to fund near-term liquidity needs through operating cash flows, borrowing capacity, property sales, and potential new financing. There is uncertainty around HTA’s ability to complete acquisitions and improve existing property operations.

Dividends

Instead of cash dividends on common shares, HTA has paid stock dividends since October 2020. Preferred dividends were $3.5 million in Q1 2024. Ability to sustain dividend payments depends on increasing cash flow from operations.

Outlook

Ongoing economic challenges like inflation, supply chain issues, higher interest rates, and the war in Ukraine may continue to negatively impact HTA’s operating performance and liquidity. However, HTA expects stable performance from its medical office portfolio. Its ability to grow cash flow from the seniors housing business remains uncertain.

Company Overview

Healthcare Trust of America, Inc. (HTA) is a real estate investment trust that owns medical office buildings and seniors housing facilities across the United States. As of March 31, 2024, HTA owned:

• 160 medical office buildings
  
• 48 seniors housing facilities
• Total of 208 properties

HTA calculates an estimated value per share based on appraisals of its properties. As of December 31, 2023 this value was $13.00 per share, down from $14.00 at the end of 2022. The value per share decreases when HTA issues stock dividends instead of cash dividends.

Financial Performance

In the first quarter of 2024, HTA had a net loss of $15.6 million compared to a net loss of $14.1 million in the first quarter of 2023. This was driven by:

• Higher operating expenses
• Mainly increased labor costs, property insurance, and interest expense

HTA’s medical office building business has been more stable than its seniors housing business during the COVID-19 pandemic. Seniors housing faced challenges with:

• Lower occupancy rates
  
• Higher operating expenses

Revenue and Occupancy Trends

Segment	Q1 2024 Revenue	Q1 2024 Occupancy
Medical Office Buildings	$34.6 million	90.5%
Seniors Housing	$53.7 million	75.3%

Seniors housing occupancy:

• Dropped during the pandemic
  
• Has partially recovered
• Was 85.1% at end of 2019
  
• 75.3% at end of Q1 2024

Higher labor costs have offset increased resident fees.

Expenses

Key operating expenses in Q1 2024 vs Q1 2023:

• Property operating expenses: Up $1.3 million
• Impairment charges: $0.3 million vs $0
• Interest expense: Up $0.6 million

Increases driven by:

• Inflation
• Higher insurance and interest rates
• Ongoing supply chain and labor challenges

Cash Flow and Liquidity

At March 31, 2024, HTA had:

• Cash and cash equivalents: $28.7 million
• Total debt: $1.2 billion
  
• Weighted average interest rate: 5.6%
  

HTA expects to fund near-term liquidity needs through:

• Operating cash flows
• Borrowing capacity
  
• Property sales
• Potential new financing

There is uncertainty around HTA’s ability to:

• Complete acquisitions
  
• Improve existing property operations

Dividends

Instead of cash dividends on common shares, HTA has paid stock dividends since October 2020.

Preferred dividends were $3.5 million in Q1 2024.

Ability to sustain dividend payments depends on increasing cash flow from operations.

Outlook

Ongoing economic challenges like:

• Inflation
  
• Supply chain issues
• Higher interest rates
  
• War in Ukraine
  

May continue to negatively impact:

• HTA’s operating performance
  
• Liquidity

However, HTA expects:

• Stable performance from its medical office portfolio
• Ability to grow cash flow from seniors housing business remains uncertain