Chartwell Retirement Residences

Q2 2026 net loss was $1.3 million versus $5.7 million in Q2 2025. FFO grew to $90.5 million, up 34% year over year, and FFO per unit increased $0.04, or 16.7%, to $0.28; reported FFO excluded $2.8 million, or $0.01 per unit, of income guarantees tied to recently acquired properties. Same-property occupancy rose 320 basis points to 94.3%, same-property adjusted NOI increased $9.2 million, or 11.9%, and NOI per occupied suite increased 8.1%. By platform, same-property adjusted NOI rose $4.4 million in Western Canada, $3.0 million in Ontario, and $1.8 million in Quebec. Looking ahead, management said it expects same-property occupancy to reach about 95% in September, with leasing strength continuing into the strongest Q4 season, and noted its three-year strategy assumes rate growth above 4% and DOE growth below 4%.

Vlad Volodarski sounded confident and upbeat about the operating backdrop, saying retirement living fundamentals in Canada remain strong, with demand growing and limited new supply. He emphasized that Chartwell is benefiting from a mix of acquisitions, development partnerships, and capital recycling, and said the company is using technology, automation, and AI-enabled tools to improve productivity and execution. He also stressed that the company wants to remain selective, keep meaningful ownership in properties, and avoid taking on development and construction risk where possible.

Jeffrey Brown focused on the operating and balance-sheet math behind the quarter. He pointed to $27.6 million of higher adjusted NOI as the main driver of FFO growth, offset partly by $4.0 million of higher finance costs and $1.7 million of higher G&A. He said liquidity was approximately $614 million at August 7, including $219 million of cash and $395 million of credit capacity, and highlighted a strong balance sheet with 3.5x interest coverage, 7.0x net debt to adjusted EBITDA, and a $2.2 billion unencumbered asset pool. He also noted $72.7 million of gross ATM proceeds in Q2 and said the company has up to an additional $500 million of trust units available under the updated program.

Analysts focused on how long same-property NOI can keep growing, why Ontario occupancy softened in Q2, the pace of new supply, and how development partnership structures work. Management said double-digit NOI growth can continue through rate growth above 4%, DOE growth below 4%, and further occupancy gains, while the Q2 Ontario occupancy dip was described as seasonal rather than a pricing issue. On development, management said the new projects generally follow a Batimo-like model with put/call mechanisms and acquisition at completion or stabilization, and they noted protections in most agreements if cap rates move. They also said no major new construction supply is on their watch list yet and that the disposition strategy remains unchanged.