Senior Housing Operating Portfolio
Michael Carroll – RBC Capital Markets: Is it fair to say that the growth rate in the senior housing operating portfolio is starting to stabilize given the 8% that delivered in 2012 versus the 5% growth that’s expected in 2013?
Scott A. Estes – EVP and CFO: Yeah, the growth rates that we produced over the last two years will be difficult to replicate at 8% plus for the most part in most quarters. That being said, it’s important to keep in mind that the same-store portfolio today is only 118 properties. So it doesn’t include portfolios like Sunrise, most of Belmont Village, Brookdale, Chartwell. Our entire RIDEA portfolio is 310 assets. So over the next 15 months you’re going to see sort of the full benefit of some of those higher growth portfolios. When we look at the entire portfolio today of 310 assets, the occupancy is see still in the high 80s and we feel like low 90s is a conservative estimate. So we still feel like over the next few years at least given the supply/demand characteristics that we could continue to produce NOI growth in excess of 5%. But, yeah, long-term we think 4% to 5% is a reasonable estimate for this portfolio.
Michael Carroll – RBC Capital Markets: Do you think the total portfolio could deliver more growth than the same-store portfolio that is comprised right now?
Scott A. Estes – EVP and CFO: It probably would. It has more fill-up assets. I don’t have the number off hand, but again I do know that the Sunrise portfolio, Chartwell and Brookdale are pretty high growth portfolios for the next few years.
Michael Carroll – RBC Capital Markets: Recently it seems that the company’s investment focus has been mainly on senior housing assets. Do you expect that focus to continue throughout the rest of 2013?
George L. Chapman – Chairman, President and CEO: Yeah, I think as we indicated in this call and previous calls, we’re mainly looking to senior housing and MOBs, because we have some really good opportunities in both places. And our goal is to move our private pay toward 85%, and reduce somewhat our exposure to reimbursement issues…
Michael Carroll – RBC Capital Markets: Then my final question relates to the skilled nursing facility, coverage ratios, I think it declined to about 1.3 times, which I believe you’ve indicated on previous calls that good number. But do you expect much improvement over the next 12 months, particularly as some of these dispositions starts are reflected in numbers?
Scott A. Estes – EVP and CFO: This is Scott speaking. There was a small decline this quarter due largely to dispositions. We still think that the 1.3 times after management fees is the right range. Today, Genesis accounts for 80% of the portfolio. So, that’s really what you’re talking about, when you look at our skilled nursing portfolio. And we do think there is upside over time. Whether that occurs next quarter or 12-months from now, we’ll see depending upon what happens with reimbursement, but we do expect it to improve over time.
Jack Meehan – Barclays: Could you talk about some of the underlying drivers of the NOI growth for the RIDEA portfolio. What — still I guess looking at occupancy and pricing, and then how does the occupancy you track during the quarter and do you have any – just a sense to where it stands in April?
Scott A. Estes – EVP and CFO: For the same-store portfolio year-over-year the occupancy was up about 300 basis points and rates were up just below 2%. We expect over the course of the year that rate growth should accelerate a little bit, most of our operators do their rate increases on the anniversary date of the residents move in rather than January 1. So, you don’t see necessarily a huge pick up in the first quarter. And then in terms of quarter-over-quarter changes, occupancy was down, but just a little bit just 20 basis points from the fourth quarter mostly because of the tough flu season, but incentives for that portfolio is already up 110 basis points as of yesterday versus the first quarter, so they’ve already recaptured all of what they lost in then some.
Jack Meehan – Barclays: Then, I guess, looking at some of the geographies within the portfolio, are there any markets that are performing better or worse than the average, and are there any characteristics around those, is it more economic or does it look like it was more flu related in the quarter?
Jeffrey H. Miller – EVP, Operations and General Counsel: Well, at least in our portfolio, the independent living sector outperformed. I think part of that is just because of the comparable quarters. The assisted living sector had been extremely strong over the last two or three years whereas independent living had been a little bit more challenged. Our portfolio today is about half and half and the independent living portion really outperformed in the most recent quarter.
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