Brookdale Senior Living (NYSE: BKD) is seeing the results of its “SWAT” team efforts to improve occupancy across its low-performing properties, according to interim CEO Denise Warren.
As of the second quarter, 129 of Brookdale’s 617 senior living communities reported occupancy below 70% and 74 communities reported occupancy in the second quarter between 70% and 75%. A total of 250 communities range between 85% and greater than 95% occupancy.
This is an improvement from the first quarter, when Brookdale reported 143 communities below 70% occupancy.
In May, Brookdale announced it was rolling out the “SWAT team” approach to assist struggling communities, and Warren said that communities “don’t start covering our fixed costs” until reaching the 80% occupancy threshold.
“We have to get them up and so we need to get those properties moving,” Warren said.
To that end, Warren said Brookdale must take a “bifurcated” approach to assisting its communities, including those struggling with census growth.
Weighted average occupancy was 80.1% in the second quarter, an increase of 200 basis points compared to the same period last year. That marks the first time since 2020 in which Brookdale’s consolidated occupancy was above 80%.
Brookdale will offload a total of 55 communities in the company’s leased portfolio and plans to rid itself of an additional 28 assets. Of 41 communities planned for sale, 27 are in the below-70% occupancy band and most will exit the portfolio in 12 to 18 months.
The Brentwood, Tennessee-based senior living provider raised its revenue per available room guidance to 5.25% and 6%, while also raising Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) guidance to $445 million and $455 million, with the transition of leased communities expected to reduce EBITDA in 2025 by $2 million compared to prior guidance.
Brookdale posted a net loss of $43 million in the second quarter of 2025, which the operator linked to an increase in operating and G&A expenses, along with an increase in depreciation and amortization expenses.
Brookdale stock fell $0.67 to $7.13, a decrease of 8.59% at market close on Thursday.
SWAT approach shows early results
Last year, Brookdale rolled out a pilot program of new incentives and pricing promotions to increase occupancy in certain communities with the goal of helping lagging communities regain census.
Of the 129 properties under 70% occupancy, 50 communities are set to be released from the portfolio through lease terminations or asset sales and 38 communities are working with Brookdale “SWAT teams” to improve census and revenue.
Of the remaining 41 properties, 19 communities require “one, two or three” move-ins to advance to the next occupancy threshold as occupancy in communities 95% and above in the second quarter includes 88 properties, up from 73 in the first quarter, Warren said.
Two SWAT teams are now in place covering 137 communities, with the first team focused on underperforming, “high-opportunity” locations that require “immediate attention,” Warren said. These properties have reported a 350 basis point increase in occupancy and 7% increase in revenue per occupied room (RevPOR) growth since the fourth quarter of last year, according to Brookdale’s financial presentation.
The second SWAT team is dedicated to working with communities that “collateralize our upcoming debt refinancing,” Warren said, aiming to improve performance to “maximized collateral value.” These properties saw an increase of 200 basis points since the SWAT effort started in the first quarter, Warren noted.
New to the SWAT effort, Warren announced on Thursday’s earnings call that Brookdale would also be creating a “permanent distressed asset team” to share resources with communities in need of additional oversight that are falling behind.
Overall as part of the effort, G&A expenses were reduced by $850,000 in the second quarter compared to the first, down from $1.2 million. Since the fourth quarter, occupancy across the 137 communities receiving additional SWAT team assistance increased 350 basis points with a 7% increase in RevPAR, Brookdale financial data shows.
“We are aware further progress needs to be made on our cost structure, and we will continue to focus our efforts on this area during the third quarter,” Warren said.
With the new efforts to improve lagging communities, Brookdale SWAT leaders can help communities hire new staff more quickly and determine the best use of capital expenditures (CapEx) to drive move-ins. In total, Brookdale invested $49 million in CapEx projects in the second quarter with 500 projects underway with specific investments made in “first impressions” upgrades to drive move-ins.
“A lot of it is really increasing the sense of urgency that we need to take,” Warren said.
Newly implemented changes at communities include daily standup meetings between operations, sales and marketing departments to improve accountability and quickly resolve operations-level challenges.
HealthPlus rollout ongoing
Brookdale continues to roll out its HealthPlus care coordination program aimed at improving residents’ quality of life and reducing preventable emergency department visits and hospitalizations, where possible.
Warren said Brookdale intends to have the rollout of HealthPlus communities to “just under” 200 by the end of this year, and the interim leader views the program as a “local market differentiator” to improve resident care and stand out against other senior living competition.
Residents in communities that use the HealthPlus platform have reported 80% fewer urgent care visits and 65% fewer hospitalizations.
“We think it’s a key differentiator for Brookdale,” Warren said. “It’s something that is differentiating us from a sales standpoint.”
Permanent CEO search continues
After the departure of former CEO Cindy Baier, Brookdale is in the process of identifying future candidates to fill the country’s largest senior living provider’s top position.
Following the conclusion of the company’s annual shareholder meeting and a contentious proxy fight with activist investor Ortelius Advisors last month, Warren said the company is moving ahead with its permanent CEO search. All of Brookdale’s recommended board members were approved by shareholders following the July meeting.
“This feedback is instrumental in how we will shape Brookdale’s path forward and we will refine how we communicate Brookdale’s value proposition,” Warren said.
Brookdale’s CEO search committee has reviewed approximately 50 potential candidates for its top post, casting a wide net across senior living, health care, hospitality and real estate sectors in search of a new leader, Warren said.
“The committee and full Board have interviewed a number of candidates, and with the annual meeting now behind us, we aim to conclude the process in the coming months,” Warren said.
