Ltc Plans To Double Shop Segment In 2025 With $400m Investment Pipeline

LTC Properties (NYSE: LTC) expects to double the size of its senior housing operating portfolio by the end of this year as the company seeks to further expand in the quarters ahead.

The Westlake Village, California-based real estate investment trust is all the while creating a “strong base” of properties and operators to support future growth, according to co-CEO Pam Kessler.

LTC plans to invest $400 million and double its SHOP segment by the year’s end, up from 13 communities today.

During the company’s second-quarter 2025 earnings call Tuesday, Kessler said that LTC is aiming for single-asset, smaller portfolios consisting of newer assets rather than value-add and distressed acquisitions that could be “a little messy.” 

“For right now, I think building a very strong base in our SHOP with newer, stabilized assets with good cash flow. That’s the most prudent way to build this platform,” Kessler said.

LTC stock rose $0.41 on Tuesday to rest at $35.15, an increase of 1.18%.

In the last two months, LTC has acquired a 67-unit assisted living and memory care property in California that was built in 2019 for $35.2 million and entered into a new management agreement with an affiliate of Discovery Senior Living and a new operator to its bench.

LTC also secured a $42 million mortgage loan for a 250-unit senior living community built in Florida in 2021, bringing the company’s year-to-date investments in 2025 to nearly $80 million, with approximately $320 million more in investments to close in the next 60 days.

Of that sum, $260 million is made up of stabilized SHOP investments with an average property age of six years with an estimated average yield of 7%, according to the company’s supplemental information.

LTC’s SHOP segment will represent 20% of the company’s total portfolio post-acquisitions, “cementing our transformation” through RIDEA conversions, said Chief Investment Officer Dave Boitano.

At the end of the second quarter, LTC reported a $400,000 increase in SHOP net operating income (NOI) stemming from occupancy gains and expense control efforts by Anthem Memory Care, another LTC SHOP partner.

At the same time, LTC also continues its effort of “strategically recycling capital” out of older skilled nursing assets and into newer senior living properties, Executive Vice President of Asset Management Gibson Satterwhite said on Tuesday’s earnings call.

Some results of the triple-net lease to RIDEA conversion effort are starting to show, with LTC generating approximately $780,000 more in income in the second quarter than what was generated under triple-net leases from the same period in 2024 as LTC transitioned 13 properties into its SHOP segment.

“We don’t have any outsized NOI projections, although we do believe that margins can be improved, but by and large, occupancy is stabilized,” Kessler said during the Q&A portion of Tuesday’s earnings call, with SHOP stabilized occupancy at 81% in the second quarter. 

There is potential for “a handful of other buildings” that could be added to the company’s SHOP segment, co-CEO Clint Malin said, “but really” the focus of this is “an external growth story,” Malin added.

“We see that the majority of the growth of the SHOP platform is going to be through external growth,” Malin said in response to an analyst question. That comes as LTC continues to be “selective” in future acquisitions to take on with a focus on newer, stabilized assets described as “newer vintage properties.”

“We’re seeing more opportunities, but we’re able to vet through those and really focus in to what we’re trying to grow the platform,” Malin added. “We are focused on execution of the remaining investments in our pipeline, but there are still other opportunities that we are going to pursue.”

Since its push to convert triple-net leases with Anthem Memory Care and New Perspective into the SHOP segment, Malin said LTC is “pre-marketing this SHOP platform” with the brokerage community and owners about expanding the company’s SHOP segment amid a “competitive” transaction landscape.

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