Healthpeak Properties, post-merger with Physicians Realty (closed March 1, 2024), posted a compelling first quarter that underscores the strategic merit of the combination. Revenue of $606.6 million in Q1 2024 reflects the megamerger lift and the expanded portfolio, with FFO adjusted at $0.45 per share and AFFO at $0.41 per share. Total portfolio same-store cash NOI rose 4.5% YoY, supported by robust performance across outpatient medical, lab, and CCRCs segments, with CCRCs delivering the strongest momentum (+27% same-store). Management highlighted the merger synergies and ongoing integration as key drivers of earnings upside, including $45 million of run-rate synergies expected in 2024 and an ~$80 million NOI upside not yet reflected in guidance. Internalization of property management has advanced rapidly: 10 markets, ~17 million square feet (sf) already internalized, with an expectation to internalize an additional 4 million sf by year-end and more than 70% of the footprint eventually.
From a capital allocation standpoint, Healthpeak repurchased $100 million of stock in Q1 at a favorable average price (~$17 per share), and has roughly $350 million of buyback authorization remaining. The company also completed the assumption of $1.9 billion of debt and secured a $750 million five-year term loan at 4.5% before recent rate spikes, leaving it with solid liquidity of about $3.1 billion and no floating-rate debt. Importantly, management raised 2024 FFO and AFFO guidance by $0.02 at the midpoint, and tightened same-store guidance to 2.5%–4%. These actions point to confidence in continued earnings growth, supported by a favorable leasing environment in life sciences and outpatient medical real estate, alongside active asset sales and a disciplined capital allocation framework.