Welltower's 2024 Q4: Key Contradictions in Senior Housing Strategy, CapEx Trends, and Talent Retention

These are the key contradictions discussed in Welltower's latest 2024Q4 earnings call, specifically including: Senior Housing Market Strategy and Occupancy Growth Expectations, CapEx Trends Post-COVID, Occupancy Growth Strategy and Pricing Power, and Retention of Talent:



Revenue and Occupancy Growth:
- Welltower reported revenue growth of 23% for the full year of 2024, along with 26% EBITDA growth and a 20% FFO per share growth.
- The growth was driven by strong occupancy trends, with a 240 basis points increase in occupancy in the second half of the year, and by a 120 basis points sequential occupancy growth in Q4.

Operating Margin Expansion:
- The company's operating margin expanded by 320 basis points year-over-year, reaching its second highest level.
- This was largely due to the significant leverage gained from high occupancy rates and a lean operating structure.

Capital Allocation and Investment Activity:
- Welltower completed $7 billion in gross investment activity in 2024, including $900 million in development spend and $6 billion in acquisitions and loan funding.
- The robust investment activity was attributed to the attractive opportunity set driven by capital market challenges in the sector.

Demographics and Demand Outlook:
- The demand for senior living, driven by the aging 80+ population, is expected to accelerate in the back half of the decade.
- The outlook for new supply remains muted due to factors like tariffs and immigration policies, further enhancing the demand supply outlook.