LTC Properties 2026 年第三季財報電話會議：SHOP 收購規模逼近 10 億美元

重點摘要

• LTC Properties (NYSE: LTC) 截至 10 月已完成約 9.5 億美元的長者住宅營運物業（SHOP）收購案，並預期 2026 年收購總額將達到約 10 億美元。這將使 SHOP 物業組合在 19 個月內從零個社區擴大至規模達 16 億美元的資產組合。
• 管理階層預期，截至 2026 年底，SHOP 將佔備考年化淨營運收益（NOI）的 50%，使 LTC 的備考內部成長率提升至三倍。該公司亦預期 SHOP 的年化 NOI 佔比在 2028 年底前有望達到約 75%。
• 第三季每股核心 FFO 由去年同期的 0.69 美元增至 0.71 美元，每股核心 FAD 則由 0.72 美元增至 0.73 美元。
• 2026 全年財測維持不變，每股核心 FFO 為 2.76 至 2.78 美元，每股核心 FAD 為 2.83 至 2.85 美元。
• 核心 SHOP NOI 財測區間收窄至 5,350 萬至 5,550 萬美元。其中位數 5,450 萬美元較先前中位數下調 50 萬美元，主因在於追溯生效的醫療補助（Medicaid）費率調降，以及照護與房型組合的變動。
• 備考流動性超過 9 億美元，而房地產業務的備考債務對年化調整後 EBITDA 比率為 4.4 倍，符合 LTC 設定的 4 至 5 倍目標區間。

關鍵財務數據

業務與營運表現

LTC 將投資組合轉型至長者住宅營運物業（SHOP）仍是其 2026 年第三季法說會的核心主軸。該公司擁有 50 處 SHOP 物業並與 14 家營運商建立合作關係，其中包括 10 月新增的 1 家合作夥伴。

管理階層表示，2026 年內完成的 SHOP 收購案僅佔篩選交易總量的不到 5%，反映出審慎篩選的併購策略。多數收購的物業均處於穩定入住水準，因此承銷評估重點在於每入住單位平均營收（RevPOR）的成長超越每入住單位平均支出（ExPOR）的增長，而非追求大幅提高入住率。

核心 SHOP 資產組合預計將在 2026 年產生 5,350 萬至 5,550 萬美元的 NOI。管理階層指出，即使在入住率未增長的情況下，只要 RevPOR 與 ExPOR 的利差維持在 200 個基點，該組合亦可實現高個位數至低雙位數的 NOI 成長。自費型營運商持續推動調價，依營運商預算及資產組合配置而定，2027 年現有物業的租金與照護綜合費率預期將維持中至高個位數增長。

此外，LTC 持續從成長較緩的三淨租賃資產中回收資本，第三季處分資產獲得的毛收益約為 4.65 億美元。在 10 處面臨依市場機制重設租金的物業中，有 3 處已進入出售程序，2 處轉為長期租約且初期年化租金為 240 萬美元，其餘 5 處仍在洽談長期租約。LTC 預期第四季將自這 5 處物業獲得 78 萬美元的租金收入。

管理階層財測

LTC 維持其 2026 全年每股核心 FFO 2.76 至 2.78 美元，以及每股核心 FAD 2.83 至 2.85 美元的財測展望。

管理階層預估 2026 年 SHOP 總收購額約達 10 億美元。此外，公司預計將於 2027 年第一季完成 2 億美元的 SHOP 收購案，屆時將再增添一家營運合作夥伴。

該公司表示，其收購案源儲備支撐了對 2027 年維持相近交易規模的樂觀看法，但這僅為預期而非正式的收購財測。目前的承銷評估假設融資組合約為 70% 股權與 30% 債券。管理階層將第一年的獲利挹注定調為大致持平，收購重點主要鎖定未來的內部成長，而非初期的投資利差。

LTC 預期 1.8 億美元的 Prestige 貸款將於 11 月 24 日償還。管理階層指出，相關利息收入的減少將抵銷 2027 年 SHOP 部分收益的挹注效果。

風險與關注領域

• 第三季接獲並追溯至 7 月 1 日生效的醫療補助費率調降，影響了兩處獨立的失智照護社區。若排除該兩處物業，醫療補助約佔 SHOP 總營收的 3%。
• 照護與房型組合調整降低了核心 SHOP NOI 的展望。管理階層將此影響定調為在僅有 27 處物業的小型核心資產組合中的短期波動，而非底層營運基本面的實質改變。
• 資本回收再投資可能會掩蓋近期的獲利成長，因為在 SHOP 投資對比較基期的獲利貢獻全面顯現之前，已出售資產與已償還貸款的收入已被扣除。
• 近期的收購資本化率已壓縮至約 6.5%。管理階層坦言未來可能面臨進一步壓縮。
• 監管風險仍是政府補助型醫療照護資產不可忽視的考量，但管理階層認為，提高自費型 SHOP 的比重將降低 LTC 對政府補貼模式的依賴。

分析師問答重點

管理階層表示，近期收購的 SHOP 資產整體營運表現均符合或略優於承銷預期。營運商持續實現自費費率調漲，而對 2027 年的人力成本預期主要集中在生活成本調整（COLA），未見嚴峻壓力。

在利潤率方面，管理階層將與同業的落差部分歸因於 LTC 在獨立失智照護物業的高集中度。在 27 處核心 SHOP 物業中，有 12 處為獨立失智照護資產，而在整體 50 處 SHOP 物業組合中則約有 14 處。

LTC 指出，資金取得並非收購的限制因素，相對嚴格的收購標準才是完成交易佔篩選案量不足 5% 的主因。與營運商及中介機構的良好關係，仍是獲取小型物業組合與個別物業的核心關鍵。

針對專業護理設施（SNF）的處分，管理階層表示市場需求依然穩健，買家主要來自私募買家與既有營運商。公司指出，高利率環境對買盤意願或資產定價尚未產生重大衝擊。

法說會逐字稿全文

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完整財報電話會議逐字稿

管理層陳述

Operator

Greetings, and welcome to the LTC Properties Third Quarter 2026 Earnings Call.

[Operator Instructions]

Joining us on today's call are Pam Kessler, Co-President and Co-Chief Executive Officer; Clint Malin, Co-President and Co-Chief Executive Officer; Cece Chikhale, Executive Vice President and Chief Financial Officer and Treasurer; Gibson Satterwhite, Executive Vice President of Asset Management; Dave Boitano, Executive Vice President and Chief Investment Officer.

Before management begins its presentation, please note that today's comments, including the question-and-answer session, may include forward-looking statements subject to risks and uncertainties that may cause actual results and events to differ materially. These risks and uncertainties are detailed in LTC Properties filings with the Securities and Exchange Commission from time to time. Including the company's most recent 10-K dated December 31, 2025.

LTC undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this presentation. Please note, this event is being recorded.

I would now like to turn the conference over to LTC management.

Clint B. Malin

Good morning, everyone, and thank you for joining us.

Our SHOP strategy is delivering from a growth perspective and has fundamentally reshaped LTC's future. We launched SHOP in May of 2025 and are rapidly transforming from a lower growth triple net lease and lending platform into a SHOP-focused REIT with a higher intrinsic growth profile.

Last quarter, we increased our 2026 midpoint acquisition guidance by 50% to $900 million and have since surpassed that guidance with approximately $950 million in SHOP acquisitions closed through October. We expect total acquisitions for the year of approximately $1 billion, at which point SHOP will have grown from 0 communities into a $1.6 billion portfolio over 19 months. Additionally, we have expanded our SHOP operator relationships to 14, including 1 new relationship added last month.

2026 has been a historic year for LTC. As we continue to focus on the tremendous opportunities ahead of us, our sights are set firmly on 2027. To date, we have $200 million of SHOP acquisitions that are expected to close in the first quarter of next year, which will also add a new SHOP operator relationship to our portfolio.

At an expected $1 billion of SHOP acquisitions in 2026, the portfolio will represent 50% of LTC's pro forma annualized NOI at year-end. At this level, our pro forma internal growth rate triples. And as SHOP continues to expand as a larger share of our total portfolio, our expected growth rate increases even further, significantly enhancing our ability to organically grow core FFO and FAD per share above historical levels.

As we have previously discussed, at our current SHOP acquisition pace, we see a pathway to generating approximately 75% of our annualized NOI from SHOP by the end of 2028. This time line can be accelerated should we identify additional opportunities to recycle capital out of older and lower growth triple net lease assets.

We are proud of what we have achieved, but even more excited about what lies ahead. Transformation is no longer a future objective. It is happening now, and LTC is entering a new chapter of growth, scale and value creation.

Now Gibson will walk us through LTC's operating portfolio.

J. Satterwhite

Thank you, Clint.

We are continuing to optimize risk-adjusted returns and increase the intrinsic growth profile of our own portfolio by recycling capital into SHOP. In the third quarter, we generated about $465 million of gross proceeds by selling triple net assets at an implied cap rate on our rent of approximately 5.5%. And the $180 million Prestige loan is currently slated to pay off on November 24. Going into next year, we will continue to capitalize on opportunities to recycle capital as we look to further accelerate our portfolio transformation.

We are also taking action on the 10-property portfolio subject to market-based rent resets. Of these 10 properties, we recently began the sales process for 3. Another 2 of the 10 properties have been converted into a long-term lease with initial annualized rent of $2.4 million. The lease contains a SHOP conversion option that could be exercised as early as the first quarter of 2027.

For the remaining 5 properties, we plan to negotiate a long-term lease in advance of the current lease expiration next year. We expect to recognize rent of $780,000 in the fourth quarter from these 5 properties.

With respect to our core SHOP portfolio, we are narrowing our 2026 guidance to $53.5 million to $55.5 million, $0.5 million below our prior range at the new midpoint of $54.5 million. The reduction is primarily due to a change in care and unit occupancy mix and a Medicaid rate decrease received in Q3 retroactive to July 1, which affects 2 stand-alone memory care communities in our portfolio.

Excluding these 2 communities, Medicaid as a percentage of our SHOP revenue is approximately 3% and is primarily offered as a spin-down option in states with rates on par with private pay rates. For private pay, our operators have been able to implement strong rate increases, and we expect that to continue into 2027.

The current guidance range for our core SHOP portfolio represents approximately 11% to 15% pro forma growth for the prior year and 13% at the midpoint. The underlying fundamentals of our business are strong.

As we've outlined in prior calls, we believe that our core SHOP portfolio can achieve high single to low double-digit NOI growth with a 200 basis point spread between RevPOR and ExPOR even at 0 occupancy growth. To be clear, we do expect that our operators will continue to drive occupancy growth going forward.

We're excited about the new and expanded operator relationships we've cultivated, the quality of the communities in our portfolio and the markets. We believe that our SHOP portfolio is well positioned to deliver the growth necessary to transform the intrinsic growth profile of our overall portfolio as we continue to increase our SOP mix.

Now Dave will discuss our recent investment activity.

David Boitano

Thanks, Gibson.

We are executing successfully in a dynamic SHOP acquisition market, maintaining our strong momentum and enhancing LTC's growth trajectory. LTC's differentiated approach centers on aligning quality assets with exceptional operators in markets with strong demand fundamentals, creating a portfolio built both for performance today and growth over time.

We've established a strong pool of operators who are well suited to the profile of communities we're acquiring, allowing us to move quickly as opportunities arise.

SHOP has opened a much larger opportunity set for LTC, and we are seeing significantly greater deal flow in 2026 than at any time in our history. We have been selective and strategic in vetting opportunities to pursue only acquisitions that fit our buy box. Illustrating our focus, the acquisitions we have closed in 2026 represent less than 5% of screen deal volume.

Heading into 2027, we expect deal flow to remain strong, especially in a higher interest rate environment and as loans originated at lower rates mature and drive owners to consider monetization ahead of those maturities.

NIC estimates that nearly $40 billion in loans will mature over the next 4 years. We are building our portfolio methodically. Investment decisions are guided by key fundamentals, including occupancy, asset quality, property scale, unit mix, size and configuration and market dynamics to assemble a portfolio positioned to perform for the long run.

LTC's collaborative execution-oriented culture resonates with operators, sellers and intermediaries. Our reputation for responsiveness, transaction certainty and disciplined execution reinforces our relationships, enhances our strategic advantage and drives a robust acquisition pipeline.

2026 has been a year of unprecedented growth, positioning SHOP acquisitions to reach $1 billion by the end of the year. This more than doubles our prior year investment activity, making 2026 the most active year in LTC's history and setting the stage for a new LTC growth era. The opportunities we see in the market today, together with our growing operator relationships and sourcing network, give us confidence in our ability to sustain our momentum into 2027 and beyond.

Now over to Cece for a review of our financial results.

Caroline Chikhale

Thank you, Dave.

With a recently expanded credit facility, a new ATM agreement, proceeds from asset sales and the expected payoff of the Prestige loan, we have ample liquidity and flexibility to capitalize on opportunities as they emerge to continue our growth trajectory into 2027 while creating additional NOI upside.

Our pro forma liquidity stands at over $900 million, including the sale of 2.3 million shares of common stock for $97 million in net proceeds in the third and fourth quarters to date and asset sales of about $465 million of gross proceeds in the third quarter.

Our pro forma debt to annualized adjusted EBITDA for real estate was 4.4x, and our annualized adjusted fixed charge coverage ratio was 4.9x. We remain well within our target range of 4 to 5x debt to EBITDA, although leverage may move within that range based on timing of acquisitions, asset sales, loan payoffs and ATM proceeds.

Core FFO per share was $0.71 for the third quarter compared with $0.69 last year, and core FAD per share was $0.73 compared to $0.72. The increase in core FFO primarily relates to a net increase in SHOP NOI from acquisitions and conversions and an increase in interest income from loan originations and construction funding. This was offset by decreases from property sales and loan and financing receivable payoffs and an increase in interest expense.

The increase in core FAD is primarily due to the same factors as the increase in core FFO as well as rent escalations, offset by an increase in recurring capital expenditures due to SHOP acquisitions.

Our 2026 full year guidance range remains unchanged. Although we've narrowed some of the underlying assumptions based on results through the third quarter, we remain on track to deliver within our expected range of core FFO per share of $2.76 to $2.78 and core FAD per share of between $2.83 to $2.85. Our assumptions are detailed in yesterday's press release and in our supplemental package, which are available on the LTC website.

Now I'll turn things over to Pam.

Pamela Shelley-Kessler

Thank you, Cece.

We introduced our SHOP strategy 1.5 years ago with a clear vision for creating a differentiated growth engine, positioning the company to capitalize on opportunities across the seniors housing sector and enhancing LTC's earnings profile. Our accomplishments to date reflect the strength of that strategy and our team's execution.

Recent stock price momentum indicates that investors value the potential higher future growth from our strategic shift into SHOP. As Clint mentioned, by year-end, SHOP will represent 50% of annualized NOI and has become a significant driver of LTC's growth. This shift from 19 months ago reflects not only the scale of the opportunity, but our ability to establish and cultivate industry-wide relationships.

Our objective has never been simply to grow the portfolio for growth's sake. We have been intentional about assembling a collection of communities positioned to succeed in today's environment and remain competitive as market conditions evolve. The communities we own and seek to acquire have established market positions, attractive demographics and physical layouts that support long-term resident demand.

Our balance sheet is a strategic advantage. As noted, with our expanded credit facility, pro forma liquidity of $900 million and the anticipated $180 million payoff of the Prestige loan, we have substantial financial flexibility to continue funding growth.

Additionally, we have proactively and successfully used our ATM to fund acquisitions, demonstrating the growing appetite for investment in LTC. In fact, comparing September 2024 prior to announcing our SHOP strategy to October 2026, the notional value of our average daily trading volume increased nearly 175% from $10 million to $27 million per day.

Eric Clark, our new Senior Vice President, Corporate Finance and Investor Relations, will be instrumental in driving that further. Welcome, Eric. We're glad to have you on board.

Our transformation has been a true group effort, and our success would not be possible without the trust of our operators and the dedication of our team. We are grateful operators choose to work with LTC and have confidence in our ability to support their efforts to provide care and services to seniors across the country, while our team has proven day in and day out that with discipline, execution and commitment, we can move faster and accomplish more.

LTC has evolved rapidly by delivering on the strategy we first laid out when launching SHOP. While our goals were ambitious, we have successfully built a scalable platform that is generating considerable momentum. As a result, we believe we are better positioned than ever to drive sustainable earnings growth, increase portfolio resilience and create meaningful long-term value for our shareholders.

We are now ready to take audience questions.

Operator

[Operator Instructions] Our first question is from Michael Carroll with RBC Capital Markets.

分析師問答

Michael Carroll

I guess, Clint, I appreciate the comments that you guys made that the total SHOP portfolio can generate high single-digit NOI growth or low double-digit NOI growth with just a 200 basis point spread between RevPOR and ExPOR. I mean is that a good measure for the broader portfolio? And maybe is there a split we should think about between the freestanding memory care portion of the SHOP and the rest of the SHOP portfolio?

Clint B. Malin

I think, Mike, well, I'll let Gibson talk about some of the detail on that. But broadly speaking, when we designed this core portfolio to give transparency to what we've been acquiring. That includes properties acquired through early January, but 12 of that 27 in our core portfolio are stand-alone memory care assets, which have different fundamentals as far as acuity, rate growth, which differs from our portfolio more broadly. So right now, we have 50 buildings in our SHOP portfolio, of which we have about, I guess, 14 that are freestanding memory care. So there's different compositions and profiles for that.

But Gibson, why don't you talk about the spread between RevPOR, ExPOR?

J. Satterwhite

Yes. Mike, it's a good question. It's a fair question. I'll hedge a little bit by saying we'll keep our comments focused on core for now. And then as we work through the budgeting process, we're now up to 50 properties. The core portfolio is 27 of those. We can -- happy to revisit.

I will say that as we roll new acquisitions in, the RevPOR is kind of coming in around the range that you're seeing in our total RevPOR range in our supplemental slides, so call it, mid-7s. And the acquisitions team as we're underwriting feels like that possibility is there. So we're not underwriting a lot of occupancy growth on stabilized acquisitions. We're underwriting that spread.

So I think given those, I don't suspect there's going to be a big change, but we can put a pin in this after we work through budget season. But generally speaking, yes, we feel confident in that thesis, and we're obviously putting a lot of money and time and energy behind that.

Michael Carroll

Okay. And it sounds like the Medicaid issue is tied to 2 communities within the memory care portfolio. Can you give us the breakout of the Medicaid exposure within the memory care portfolio alone? And is it only 2 communities that have a lot of Medicaid exposure and the rest is included in that 3% number you provided?

J. Satterwhite

Yes, that's right. That's right, Mike. So it's primarily concentrated in those. Those 2 are in a state that has good reimbursement on par with private pay. And it's a niche program in that state where they can take in residents. They get equivalent to what you might get in the skilled nursing, but they're able to get that in a residential setting.

So that was the -- unfortunately, right after we rolled out guidance and increased our RevPOR guidance on the last call, we found out about that. That decision was issued after our last call. But yes, the rest of the portfolio, the bulk of it is in those buildings.

Michael Carroll

Okay. And then just last question for me on the potential asset sales. I know that there was that one SNF tenant that's going to elect to exercise its purchase option. I know that in the press release, you gave us the mechanics on how the purchase price is going to be decided. But can you give us some idea of what the potential yield can be? Is it going to be in like the low 8-ish percent type range? Is that kind of a fair estimate? Or is it a little bit different than that?

Clint B. Malin

I would say we're in the process of determining this, and we structured this transaction to where we can participate in value creation of those buildings. So I think it's too early to give you a specific number, but we feel confident in how we structured the transaction to not just be paid off at our gross book to participate in upside in those properties. So we'll provide more color on that on probably our next earnings call.

Operator

Our next question is from Rob Stevenson with Huntington.

Robert Stevenson

Just on the skilled nursing side, can you talk about what the disposition market looks like there today? Given most people's higher cost of capital, how materially is pricing for those assets being impacted today and demand, et cetera, that you're seeing?

Clint B. Malin

We've experienced in recent transactions where there's been tremendous appetite primarily in the private buyer market for skilled nursing. So we haven't seen a change in that. It seems to be very robust.

Pamela Shelley-Kessler

Yes. Interest rates, you're probably getting at the increase in interest rates and what effect that's had, but we haven't seen that have a material effect on the appetite or pricing within the skilled nursing industry.

Robert Stevenson

Okay. Are these -- the dispositions you guys have done recently, have they gone to normal buyers? Or is this part of the sort of further of 1031 and bonus depreciation buyers that seem to be supporting the market to a greater extent here in the fourth quarter?

Pamela Shelley-Kessler

Well, for us, it's generally been the operator. So maybe that's why we're not seeing any price changes because the operator, especially under a lease is going to be your strongest buyer.

Clint B. Malin

But in other cases where we sold -- I mean what's not been to the existing operator in a couple of cases, it's been buyers that are known quantities in the industry that have been long-term investors.

Robert Stevenson

Okay. That's helpful. And then noticed that ExPOR on the core SHOP portfolio declined quarter-over-quarter. Is that just short-term noise? Or is there some significant initiatives that you guys have underway in the portfolio to reduce costs on the expense side?

J. Satterwhite

I call it a little bit of noise. This is Gibson. I call it a little bit of noise. Just keep in mind that 27 properties in and of itself is a pretty small sample size when you're talking about same-store portfolio. And then again, 12 of those are stand-alone memory care. So you get more variance around whatever the mean is from quarter-to-quarter.

On balance, the reductions there were some successful property tax appeals and better GLPL experience, but nothing that's really -- I mean, those are real and those kind of carry forward. But structurally, I would call that some changes, improvements around the edges.

Operator

Our next question is from Omotayo Okusanya with Deutsche Bank.

Omotayo Okusanya

Just kind of curious from a regulatory perspective, if, again, the midterm results create any additional or even a reduction in regulatory risk? And then also specifically, if you've heard any additional news around CMS and some of the talk about them recalibrating PDPM because of concerns about of charging.

Pamela Shelley-Kessler

Tayo, I mean there's always regulatory risk, right? And I don't see that changing significantly now versus in the past. I think broadly, there's been bipartisan pushback against some of the initiatives from the more progressive side. And I think at the end of the day, cooler heads prevail on that and a lot of its headline noise. But it's certainly something that we keep an eye on.

Clint B. Malin

And we do feel -- we feel positive about by moving our portfolio to more of a SHOP focus on a private pay model than on reimbursed model.

Omotayo Okusanya

Got you. That's helpful. And then on the SHOP side, again, really good activity from an investment perspective. So you guys are clearly getting deals done. But you also mentioned that it is kind of increasingly competitive out there. So could you just talk a little bit about some of the things you're doing to still kind of get your fair share of transactions that you're interested in?

David Boitano

Sure. This is Dave. So our by word would be relationship, right? We're super focused on our operator relationships, our intermediary relationships and being there, whether it's 1 building or 2 or 3, being super responsive.

I think one of the, you can say, non-balance sheet assets for us are our operator relationships because they give us an early look at situations and opportunities and a chance to sort of continue that relationship and grow with them. So just servicing as much as we can, everybody we touch and maintaining what I call our LTC brand in terms of responsiveness and being on it and cutting to the quick. If something doesn't fit, we'll tell them. It doesn't work. If something does work, we're going to lean in hard.

Operator

Our next question is from Juan Sanabria with BMO Capital Markets.

Juan Sanabria

Just curious if you could maybe talk a little bit about how investors should think about the growth profile of the company. I think you said given what you've done to SHOP or growing SHOP that the growth profile from a cash flow basis NOI or rents is up 3x and when that should begin to flow through to the bottom line and how that more I know a lot of the movements in '26 have been kind of capital recycling that's been neutral to earnings. But how does that change, if at all, for '27, just given you have more higher growth SHOP assets at present?

Pamela Shelley-Kessler

Yes. Thanks, Juan. There has been, to your point, a lot of noise in the flow-through from our acquisitions due to the capital recycling. And that kind of -- you have a forward 12 months of that and especially with the Prestige loan payoff here in November.

But once that's all flown through the comparative periods, you have 50% or more of the SHOP is dropping to the bottom line. As the SHOP NOI percentage grows, and I talked about on last call, we were looking at just the math getting to 75% in 2028. That flows through to the bottom line because there's not much incremental cost from a corporate standpoint to that. So it increases significantly.

Juan Sanabria

Okay. So not to put words in your mouth, but we should see earnings growth in '27?

Pamela Shelley-Kessler

As we continue to acquire properties, yes. I mean we did -- we did say in -- I'm sorry, what did I say?

Caroline Chikhale

Jaun, in '28.

Pamela Shelley-Kessler

Yes, '28. I mean there will be in '27, we have flow through, but we have the -- we'll have 11 months of the Prestige payoff that also flows through to counterbalance that.

Juan Sanabria

Okay. And then just going forward, I mean, beyond Prestige, is the focus more on booming -- continuing to prune skilled nursing? You talked about good appetite from buyers there. I know some of your peers have been more focused on asset management and capturing higher rent coverage levels through higher rent, either with existing or new tenants. And just kind of the strategy or philosophy on how you approach those opportunities? Is it more skewed towards dispositions and continuing to upweight SHOP? Or is it capturing higher growth than traditionally is available through your skilled care assets?

Clint B. Malin

We had examples of that early in the year when we recycled capital out of skilled nursing leases that were expiring. It really was us looking at a situational opportunity of really having a growth trajectory through SHOP and recycling that capital at an attractive rate for a higher growth profile of assets.

So that was really a strategic decision as we really focus on growing our SHOP platform. We'll look at that as we go forward as far as opportunities. But if we do have ability to attractively recycle capital in existing leases to redeploy to SHOP to be able to accelerate that growth to a higher growth profile, that's where we want to go. I mean our ultimate objective is driving per share earnings growth.

Juan Sanabria

Beyond the loan payoff in November, anything else out there that we should expect? I know you flagged the purchase option that was going to be taken up here in the first quarter, I believe. But anything else on the loan repayments to ALG, et cetera, that could be a source of proceeds?

Clint B. Malin

We've always talked about ALG as a possibility. It's been a view of a shorter duration investment. So it's possible those could lead to payoffs. We've set that aside as always a possibility. We are not exactly sure the timing of that. But we do have people, lessees in our portfolio call us about opportunities to look at purchasing assets. We're not looking at doing transactions that are dilutive, but we'll update you on the next quarterly call in regard to any changes on that.

Operator

Our next question is from Jamie Feldman with Wells Fargo.

Jesus Garcia

This is Jesus on for Jamie. Just looking at your SHOP margins over here relative to peers, just how much of that gap right there reflects the higher acing memory care mix? And how much of that gap do you think you can narrow over time?

J. Satterwhite

I think it's fair to say that our core margins are impacted by the memory care mix. And I think as we go into -- because at the beginning of the year, when we rolled out the core portfolio, 27 properties, that was about 98% of our owned NOI at the time.

And so by the time we get to the end of the year, our core SHOP portfolio, call it, $54.5 million, $55 million, that's going to be approximately half of our like SHOP NOI on a pro forma basis at the end of the year. So we'll give some consideration to how we constitute the core portfolio next year to capture kind of the broader trends. But I think in the core portfolio, I think you're seeing the impact of the stand-alone memory care.

Jesus Garcia

Great. And for the acquisitions you're underwriting today, what's the permanent debt-to-equity funding mix that you're assuming here? And like what initial accretion hurdle must the deal clear?

Pamela Shelley-Kessler

Well, we're continuing with the 70% equity, 30% debt. And it's pretty flat the first year as we've talked about, but there's looking at for future growth. Yes, what we're buying is future growth. That's probably the best way to look at it. We're not spread investing at this point.

J. Satterwhite

I'll say a circle back to the initial question. I suspect that some of our peers have higher component IL in their same store as well. So that could be another factor, but...

Pamela Shelley-Kessler

For the higher margin?

J. Satterwhite

Yes, but the memory care is a factor.

Operator

Our next question is from Austin Wurschmidt with KeyBanc Capital Markets Inc.

Austin Wurschmidt

You guys referenced in the prepared remarks, you've transacted on less than 5% of the assets that you've underwritten. And I was wondering if that's more a function of product quality or access to capital, just given a large amount of the acquisitions this year have been funded with proceeds from capital recycling. So to the extent the opportunity to access the equity markets expands, how does that potentially increase your ability to kind of grow the acquisition pace from what you've seen this year?

Pamela Shelley-Kessler

Well, the capital markets is not constraining growth. It's the opportunity set. And I think we're getting our fair share at $1 billion this year, we're certainly getting our fair share of the opportunity set. I think our buy box is probably much smaller than some of our peers. And we're being very selective as we've talked about all year long of what we're buying, and we will continue to be selective. But right now, we don't see the opportunity set narrowing. Our pipeline for next year already looks good. So we're very optimistic about 2027 and our ability to transact at the same volume level as this year.

Austin Wurschmidt

Appreciate the thoughts. And then Gibson, within SHOP, how is performance this year within the core portfolio as well as just from what you've seen as far as the acquisitions, how the performance is stacking up versus underwriting? How does that all shape your thoughts about kind of the pace of occupancy upside in a given year?

J. Satterwhite

Yes. Well, I guess I'll answer it this way first. I think with the deals that we've been acquiring, they've been generally stabilized occupancy. So we haven't been making a big bet on stabilized occupancy. So it's really been come down to the ability to -- the thesis has been that given the supply-demand dynamics that RevPOR will continue to outpace the expenses. And we're seeing that play out. That's the top line of the core metrics, notwithstanding today, I can get into that a little bit.

On your question on how they are performing relative to underwriting, I think on balance, things are performing kind of in line or a little better with underwriting. If you spread that across core and on the brand-new deals. Now the new deals are just coming in.

But on the core side, we actually, in our guidance incorporated higher than underwriting expectations -- and so that's coming in a little better. I think on balance, everything is performing in line with expectations with underwriting.

On the RevPOR side, I think as we look at kind of the underlying fundamentals of the business, I mentioned some of the drivers behind that. So if you think about the 50 basis point decline in our outlook for the full year pro forma year-over-year, about half of that, just slightly more than half of that was due to the Medicaid issue in those 2 stand-alone memory care buildings.

The rest of that, we view as -- and that's something that we feel like they can overcome in terms of the portfolio with continued occupancy growth in the overall portfolio and room for margin improvement.

If you look at the other piece of that, which was slightly less than half of that change, that was really due to unit mix across a little bit more IL than AL sting to have both. You're not reducing staffing levels for that, a little less acuity in memory care around the margins. Again, you're not reducing staffing levels for that, a little trend, quarterly trend to lower RevPOR memory care units.

And that we just didn't -- we feel like that will sort itself out over time. We're not really concerned about that. We just didn't model that to bounce back in Q4. What we're seeing on the ground, the top line result in that kind of RevPOR us bringing RevPOR down is not what we're seeing on the ground.

What we're seeing on the ground with respect to -- if you just look at like-for-like care unit type market, our operators have been throughout the year, been able to implement strong rate increases. And as we head into next year, I think we're optimistic that we can do -- that they can do the same kind of talking about in-place mid-single digit to high single digits in-place rate growth.

And so I feel like -- we feel like the fundamentals are really strong on that. And on the expenses, labor is the bulk of your cost structure. And we're not hearing a lot of acute pressure as we go into budgeting season as people look into 2027.

Generally speaking, most people are talking about kind of cost of living increases. So I think we feel like the fundamentals underlying the business are strong. We feel like some of the top line around the SHOP metrics are a little bit more noise than signal.

Clint B. Malin

Also to add to Gibson's comment is also the acquisitions that we have invested in, we've retained the existing manager for the most part other than a few opportunities. So that leads to consistency of leadership, staffing, familiarity with the markets and the ability to be able to drive RevPOR growth as well as manage expense. So we're excited about that.

Austin Wurschmidt

And just to summarize some of that, the single -- the mid- to high single-digit rate increase you referenced, is that the in-place growth at the outset of the year or sort of the pace of RevPOR growth? And is 50 to 100 basis points of occupancy upside similar to what you're tracking towards this year, kind of a good run rate in terms of annual upside and occupancy -- the pace of occupancy growth?

J. Satterwhite

Yes. We'll get -- let me address that first. We'll get to the occupancy assumptions as we get into next year as we get through budget. I might get my hands smacked if I commit to that now and go back to the operators and push it through that way. So I don't think it's unreasonable, but we'll get to that as we get through budget season.

When I was talking about the potential rate growth on the table, that's in-place blended rent plus care for the in-place residents for your private pay residents. Now that's consider that the range. Our experience is depending on who's doing that, more weighting towards certain portfolios that may blend you down to the lower end of that range. And as I just mentioned, we got a little bit of Medicaid around the margins. We don't really budget for any increases there.

So we're -- I wouldn't say to take the midpoint from 5% to 9% and budget is for 7%. But what I am saying is that as you look at kind of the in-place rates year-over-year and what people are -- what's on the table, we don't really see a deceleration in that. It seems to be pretty consistent and be at levels that allow us to see the double -- that kind of high single-digit, low double-digit growth -- organic growth in our SHOP portfolio.

Operator

Our next question is from Rich Anderson with Cantor Fitzgerald.

Richard Anderson

So I just wanted to a little -- one extra dose of clarification on this modest downtick on the core NOI from SHOP. I get half is the Medicaid issue. That's fine. The other half is this unit mix issue. That's going to happen all the time, right, for the rest of eternity as you're a SHOP owner. We're always going to have that change in care, change in unit mix sort of function. That's just the way the business goes.

And so Gibson, I think you said this, but I just want to make sure. If you had a quarter to go in the year, you make this change. But if you had 5 quarters, the RevPOR growth probably overwhelms this and you don't actually have a reduction. Is that the right way to think about that metric?

J. Satterwhite

Yes, that's right.

Richard Anderson

Okay.

J. Satterwhite

We're just not -- just -- we view that as, again, getting back to sample size, 27 properties, a lot of the variance we're talking about in the stand-alone. You just can't -- frankly, it's challenging to model quarter-to-quarter. But over the long term, it does -- I think you said it very well, Rich.

Richard Anderson

Okay. And then this is probably obvious to everyone but me. But in the press release, your total SHOP NOI also declined by the same amount, $500,000 or something. And I'm curious why that would have happened as you're growing so substantially through acquisitions. Why would have we've seen SHOP total NOI guidance come down to that sort of, I don't know, $75 million range, down a little bit from last time you spoke?

J. Satterwhite

Yes, that's good. That's a fair question, Rich. We're pretty fully baked right now on our guidance. So call it, $20 million. So $55 million, we brought that down $0.5 million in core. And so that's really kind of the incremental change around the margin. So that implies that we don't have any changes for -- we got high value-add properties than everything new that's been acquired relative to our model.

So I think we've got a little bit left potentially in the pipeline, but we've closed, what, $950 million as of last Friday. And so that's kind of baked and that's known, and we're just getting those properties into the portfolio. We're not moving guidance around for that.

Richard Anderson

Okay. And then last question is a little bit bigger picture. You're buying at 7-plus initial cap rates. I think Cece said flat in the first year based on your weighted cost of capital, which is fine. But I am curious as to that 7-plus -- 7 handle on the return.

I mean, it's odd to me that an asset class that's growing so substantially is -- can be acquired at elevated -- what I would call elevated cap rates. When you think of multifamily cap rates, which is growing nowhere near SHOP, those are 5 handle if you're lucky. And so I'm curious your thought on the future of initial cap rates on your external growth profile and if we should -- we think that this 7 handle number is going to happen in perpetuity?

Clint B. Malin

Well, Rich, on that, if you look at Slide 5 in our supplemental, I mean, we look at -- we give our year 1 projected cap rates for our deals. And you can see that there's cap rate compression on the most recent deals we've done in sort of the 6.5% range. So that's where we see opportunity going forward in that range.

Could there be a little more compression? Sure. But we're looking at transactions that are 1 or 2 asset portfolios, not looking at large transactions. We've been fortunate to find a few deals that have been 4 or 5 buildings. So what we're looking at, we're finding opportunity with that.

And as Pam indicated, we're changing our mindset where we're not spread investing. We're looking at the composition of the buildings, which Dave spoke about in his prepared remarks as far as the unit configuration, the size of the communities, the age to compete effectively against new development when it comes online. So we're -- as Pam said, it's future growth that we're investing in.

Richard Anderson

Yes. Fair enough. And thanks for the color and thank you for pointing out my not reading Slide 5. I would have gotten to it eventually.

Operator

We have reached the end of the question-and-answer session. I would like to turn the floor back over to Clint Malin for closing comments.

Clint B. Malin

Thank you for joining us today. We really appreciate your interest in LTC and our continued story. We look forward to seeing some of you at upcoming investor conferences over the next couple of months. Thank you for your time.

Operator

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.