Less than one week ago, Sonida Senior Living (NYSE: SNDA) announced a merger with CNL Healthcare Properties. The deal will serve as an “inflection point” to new growth, according to the company’s leaders.
Sonida is under a $1.8 billion deal upsizing its senior living portfolio to 153 owned independent living, assisted living and memory care communities. Sonida also has acquired 23 assets over the last 18 months.
With the moves, Sonida is again retaking a spot in the rankings of top-10 largest operators in the U.S. by unit count. The deal is set to close late in the first quarter or early in the second quarter of 2026 and “accelerates the company’s growth profile” and sets the company up for even further growth in the coming year, according to CEO Brandon Ribar.
“Once we close and integrate the CHP portfolio, we hope to return to this pace of acquisitive growth,” Ribar said during a company earnings call. “The commitment of a new upsized $300 million revolver at close of the transaction will further increase our available capital to capitalize on our robust investment pipeline in the second half of 2026.”
Outside of preparing for growth, Sonida has increased its weighted average occupancy rate to 87.7% in the third quarter of the year. As of the quarter’s close, Sonida’s net operating incoming (NOI) margin reached 27.3% in the third quarter of 2025, representing a dip from the second quarter of this year, when community NOI registered at 28.6%.
Sonida’s stock is priced at $32.20, up 0.4% from the previous close.
Springboarding off the CNL merger
Following the closing of the deal with CNL Healthcare Properties, Sonida will have a more flexible balance sheet and more dry powder to transact in “growth markets where building density likely makes sense,” Ribar said.
Sonida has grown in Texas, the Southeast and the Midwest and Ribar sees additional opportunities in the U.S. The company is currently targeting “disciplined inorganic accretive growth through acquisitions, joint ventures and third-party management contracts ” in the U.S. Rocky Mountain and mid-Atlantic regions, complementing CNL Healthcare Properties’ current footprint.
Sonida’s strategy looking ahead is to build itself up under an “owner, operator, investor” model wherein the company’s regional clusters and density give it the ability to better manage its communities.
The company’s leaders believe the operator has a unique market niche as one that combines aspects of both real estate investment trusts (REITs) and operators. They also are maintaining balance sheet flexibility in order to reap other opportunities ahead.
The company’s market position affords it several benefits, including the ability to lean on local and regional operating structures, enhanced market knowledge and expertise, operation synergies, flexibility to manage staffing needs across local and regional portfolios and a wider leadership and development pool to support talent retention and growth.
Growth in results
Sonida is growing not only through acquisitions, but by notching community operational improvements.
Sonida has worked to restructure its labor force, reducing turnover and increasing stability in local leadership at the community level has helped manage labor costs with more consistent wage growth. New scheduling systems and clearer communication helps staff with more reliable information on resident needs and improves response times as well, according to Ribar.
“We continue to experience meaningful reductions in staff turnover on a year over year basis which also supports strong care and services for our residents,” he said.
Sonida has managed to practically eliminate contract labor from its workforce as well, now registering at just a fraction of labor expenses.
As the company continues to grow, Ribar added he is confident the company will “continue to attract top notch talent with a commitment to providing high quality care and services to our residents.”
Among Sonida’s top priorities over the past year has been stabilizing the 19 communities it acquired in 2024. Those communities saw a 370 basis point increase from the second quarter to the third this year, reaching an average of 83.7%.
Sonida grew resident rates 4.2% for those communities, according to Ribar.
Ribar added this kind of performance in integrating communities into its operating platform further increases the company’s confidence in its ability to execute on the “more complex and scaled transaction” through its merger with CNL Healthcare Properties.
Shifting additional dollars to the company’s marketing team has created a wider, more consistent sales funnel, according to Kevin Detz, chief financial officer of Sonida.
Sonida also has continued to focus on internal sales lead while reducing reliance on third party referrals, with a decrease of placements from 43% to 26% year over year. Digital marketing efforts led to an increase in both lead volume and quality of referrals, Ribar told Senior Housing News. Sales staff also received additional training, and the operator experienced strong demographic trends in its “strong growth markets.”
However, occupancy trends as a whole had lagged behind industry averages by around 200 basis points earlier this year, and most of the portfolio’s growth occurred in the back half of the third quarter, according to Ribar.
“We’ve seen the combination of a reduction in move out through death and then an increase in move-ins that we’re generating through our own internal mechanisms, that ultimately is helpful from just an overall margin and growth perspective,” Ribar said. “We’re pleased to be knocking on the doorstep of 90% but we know that continued growth and margin flow-through are absolute areas of emphasis for us as we close the year.”
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