REIT - Healthcare REITs: Safe And Effective

• Healthcare REITs - which were "ground zero" of the pandemic - were revived by the early vaccine rollout, but the "fourth wave" of the pandemic has slowed the positive momentum.
• Senior Housing REITs - the hardest-hit sub-sector - were leading the recovery as occupancy rates appear to have bottomed in early 2021, benefiting from the red-hot and undersupplied housing market.
• Staffing shortages have become critical issues at skilled nursing facilities - worsened by recent vaccine mandates - pressuring not only operating margins but also forcing some facilities to turn away new business.
• For skilled nursing REITs, operator issues have re-emerged as government relief funds begin to dry up. Medical office and lab space, however, have been largely unaffected by these headwinds.
• While near-term headwinds will persist until the pandemic abates, we remain optimistic on the long-term outlook for healthcare REITs. Baby Boomers are substantially larger and wealthier than any prior generation.

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