Criticism of a new Welltower skilled nursing operating partnership drove down the real estate investment trust’s stock price Wednesday, but current operator ProMedica said Thursday that a damning report was based on “many inaccuracies.”
After experiencing $200 million in operating losses, ProMedica is exiting a joint venture with Welltower and being replaced by Integra, effective Dec. 19, according to previous reports.
This week, Hindenburg Research slammed Integra’s track record and Welltower’s willingness to invite the unproven firm into co-ownership and operation of 147 skilled nursing facilities.
While Welltower didn’t respond to a request from McKnight’s Long-Term Care News for comment Thursday, ProMedica released a statement clarifying Integra’s expected role with the facilities.
“We are aware that false information about the transaction involving ProMedica’s senior care facilities has been circulating due to an investor opinion piece referenced as a research report,” the statement said. “That opinion piece contains many inaccuracies — the most obvious of which is the fact that Integra is not the proposed operator in this transaction.”
The Ohio-based not-for-profit continues toward closing the deal with Welltower.
ProMedica agreed to give up its equity in an existing joint venture to improve its financial outlook and give Welltower freedom to reposition. During an early November earnings call, Welltower announced that it had chosen the seven-month-old Integra organization as its new partner.
Hindenburg criticized Integra as inexperienced in skilled nursing operations, and alleged conflicts of interest in previous business involving Welltower and Integra CEO David Gefner.
The Hindenburg report was not the first time Integra’s role and qualifications had been questioned. Media in Philadelphia, where ProMedica took over many former HCR ManorCare facilities, has also challenged Integra’s capabilities and noted the lack of transparency into the firm.