Full Transcript: Chiron Real Estate Q2 2026 Earnings Call

Chiron Real Estate (NYSE: XRN ) reported second-quarter financial results on Thursday. The transcript from the company's second-quarter earnings call has been provided below. APIs provide real-time access to earnings call transcripts and financial data. Visit to learn more.

The full earnings call is available at Summary Full Transcript OPERATOR Good morning, ladies and gentlemen, and welcome to the Chiron Real Estate Inc. second quarter 2026 earnings call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session.

If at any time during this call you require immediate assistance, please press star-zero for the operator. This call is being recorded on Thursday, August 6, 2026. I would now like to turn the conference over to Jamie Barber, General Counsel. 's second quarter 2026 earnings conference call.

My name is Jamie Barber, and I am Chiron's General Counsel. On the call today are Mark Decker, Chief Executive Officer, Matthew Whitlock, Chief Investment Officer, Bobby Zeiller, Chief Development Officer and Head of Senior Housing, Anika Holly, Chief Administrative Officer, Bob Kiernan, Chief Financial Officer, and Aaron Roseth, Chief Operating Officer. Statements or comments made on this conference call may be forward-looking statements. Forward-looking statements may include, but are not necessarily limited to, financial projections or other statements of the company's plans, objectives, expectations, or intentions.

These matters involve certain risks and uncertainties. The company's actual results may differ significantly from those projected or suggested by any forward-looking statements due to a variety of factors, which are discussed in detail in our SEC filings. Additionally, on this call, the company may refer to certain non-GAAP financial measures. You can find a tabular reconciliation of these non-GAAP financial measures to the most currently comparable GAAP numbers in the company's earnings release and filings with the SEC.

Additional information may be found on the Investor Relations page of the company's website. I would now like to turn the call over to Mark. Mark Decker, Chief Executive Officer & Director Thank you, Jamie, and good morning, everyone. I feel like a kid in a candy store this morning sitting around the table with all this talent, and I'm even more excited that we share the same simple vision to deliver value at the intersection of care, capital, and real estate.

I want to start by welcoming Tami Cumings, Aaron Roseth, Matthew Whitlock, and Bobby Zeiller. And I'd like to thank Bob, Anika, Jamie, and the rest of our team for a tremendously productive five months. I also want to recognize and thank Alfonzo Leon, who stepped down earlier this week as Chief Investment Officer. When we laid out our priorities earlier this year, we said we would focus on active capital allocation, portfolio repositioning, and building the capabilities necessary to support our next phase of growth.

Over the last several months, we've made meaningful progress on each of these objectives. Before discussing the transformation that's underway, it's important to recognize that our existing portfolio continues to perform well. 7% on a normalized basis, which is in line with our expectations and the same-store guidance we issued at the beginning of the year. The strategic actions we're taking today are not a response to operational challenges.

It's about capital allocation. Outpatient medical can be an excellent investment, but as we've discussed, there are better total returns available within healthcare real estate. With that in mind, I'd like to discuss what we're doing to position Chiron for the future. Thank you.

The common thread across everything we're doing is straightforward. We're reallocating resources towards opportunities that we expect to create a more durable and relevant real estate platform that can compound stronger long-term returns. And so let's review our recent progress. We closed on the $100 million Maywin investment contemporaneously with the closing of our first two seniors communities: The Landing, a stabilized continuum of care community in Alexandria, Virginia, and The Riviera, a sister community across the courtyard from The Landing, which opened this March and is in lease-up.

Together this forms a community of 292 luxury homes. 3%. This generated approximately $200 million of gross proceeds, and we retained a small equity interest in the venture. The combination of these transactions leaves us well positioned on the balance sheet side with no maturities until 2028 and less than 40% leverage.

And while I know we all prefer debt to EBITDA, given the nature of our leased communities, we're going to refer principally to our covenant metrics for a time. 9%. Proceeds from these sales will be directed towards assets offering a higher return on capital. The most immediate use will be to complete the previously announced acquisition of The Pinnacle, a marquee luxury community that we put under contract in the second quarter.

The Pinnacle welcomed its first residents in June, and we couldn't be more pleased with the early momentum at the community. We remain active in evaluating further dispositions from our outpatient medical portfolio, including through individual sales or larger portfolio transactions, and see no shortage of opportunities to redeploy these proceeds in a way that will drive our long-term return on capital higher and deliver value to our shareholders. While there's been a lot of transactional activity, the biggest story is our leadership team.

Executing on a transition of this magnitude and then building the business we envision requires specialized expertise, and we've spent considerable time strengthening the organization. Accordingly, over the past several weeks we've welcomed Tami Cumings, Aaron Roseth, Matthew Whitlock, and Bobby Zeiller into leadership roles at Chiron. Together they bring more than 100 years of experience sourcing, developing, operating, and managing senior housing communities. Most importantly, these additions are highly complementary.

This is an operational business, and to be a good partner, we need a strong operator's eyes. With Tami Cumings, our new SVP of Senior Housing, we've added decades of operating experience to ensure that our communities are managed in a best-in-class fashion. To be a great partner with operators and deliver a consistent experience for our team in the street, we need an organization that remains curious and focused on constant improvement. Aaron Roseth, who led a best-in-class architecture firm with industry-leading profitability, is skilled at both running large gray matter organizations and building deep client relationships.

Together with Anika, who's in many ways the heart and soul of our company, we are seeking to become the best partner we can. Matthew joins us as Chief Investment Officer. With three decades of senior housing thought leadership and experience on all sides of the business, he will be the tip of the spear as we seek to deploy capital wisely. Bobby is Chiron's Chief Development Officer and Head of Senior Housing.

Bobby literally built the Bedrock communities that we purchased from Silverstone, which he led, and in addition to constructing communities, he has a great way with people and ultimately I think his superpower is working with operators with a focus on empathy and respect, as well as accountability, and most importantly, an eye to what sustains a great customer experience for our residents. Together, these leaders expand our ability to identify opportunities, underwrite risk, support operators, work as an effective team, and maximize performance across the portfolio. We believe Chiron now has the leadership platform necessary to deliver on our vision.

Finally, I'd like to address valuation. We continue to believe the market's not fully recognizing the value embedded within our legacy outpatient medical portfolio. Our belief is supported by a growing body of public and private market transaction activity that demonstrates the robust institutional demand for outpatient medical real estate at cap rates that compare favorably to the implied valuation of our MOB portfolio. We've highlighted this on page 14 of our most recent investor presentation.

We can't control where the market values our shares in the near term. What we can control is disciplined execution. We believe that it's prudent to lean into this pricing dislocation and sell assets which we believe will offer meaningful upside that's not currently reflected in our stock price, and allow us to reallocate capital into higher-returning assets. Taken together, we believe the company is better positioned today than it was six months ago.

We have enhanced our leadership capabilities, made meaningful progress on our portfolio transition, and established a clear roadmap for continued execution. With that, I'll turn the call over to Bob to provide additional details on our financial and operating results for the quarter. Bob Kiernan, Chief Financial Officer Thanks, Mark. 04 per share and unit.

6 in the first quarter. 8% on a year-over-year basis. This increase was consistent with our expectations and was adversely impacted by a one-time nonrecurring revenue recovery recognized in the prior-year period related to a single tenant. 7%.

8 million, down slightly from the first quarter of this year. Looking ahead, while we expect that the changes in senior management will increase our G&A cost in the short term, we believe that as we reposition the investment portfolio, our costs will be in line with the size of our portfolio. Regarding our equity capital, we're pleased to have issued the $100 million of Series C convertible perpetual preferred in the quarter. The sale of our seven inpatient rehab facilities, at an aggregate value of $217 million, demonstrates our ability to recycle capital at an attractive rate.

We ended the quarter with $259 million in unutilized borrowing capacity under our credit facility and our leverage ratio of just under 40%. Mark, would you like to provide any closing remarks? Mark Decker, Chief Executive Officer & Director Thanks, Bob. Before opening the call for questions, I'd like to leave everyone with one final thought.

The story at Chiron today is not about aspirations, it's about execution. Over the last several quarters we built a strategy, assembled a team, raised fresh capital, completed acquisitions, and successfully recycled assets. There's certainly more work ahead, but our entire team is laser focused on building Chiron into a best-in-class organization. We're excited to share more about the business.

Operator, please open the line. OPERATOR Thank you. We will now begin our question-and-answer session. Should you have a question, please press the star followed by the one on your touchtone phone.

You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the two. And if you're using a speakerphone, please lift the handset first before pressing any keys. We have our first question from Juan Sanabria with BMO Capital Markets.

Juan Sanabria, Analyst at BMO Capital Markets Hi, good morning. Thanks for the time, and congrats on the new team being assembled. I guess just hoping, Mark, maybe you could talk a little bit about the strategy here going forward and what types of assets you're looking for, and as part of that, kind of the plans for the Reston land parcel acquisition you announced with results yesterday. Mark Decker, Chief Executive Officer & Director Sure.

Thanks, Juan. The strategy is as we've outlined, to be focused on seniors housing and, I mean, honestly, the Reston land we have a great plan for. I would remind you it's about 1% of assets, and we'll tell you more as that plan unfolds. But short version, we're going to use it as currency to build rapport with operators, and it's shovel-ready and great demos.

Juan Sanabria, Analyst at BMO Capital Markets Sorry, maybe I wasn't super clear. Just, I guess, is the focus to be more on development assets that require patience in lease-up, or more stabilized assets, in terms of the acquisitions and capital recycling? Mark Decker, Chief Executive Officer & Director Definitely more stabilized assets. Juan Sanabria, Analyst at BMO Capital Markets Great.

And then I think Bob alluded to it—how should we think about the pro forma G&A run rate with the additions to the team? Mark Decker, Chief Executive Officer & Director I mean, for the time it'll be higher, but I mean, I would say, one, we're really viewing this as a growth-oriented team and a growth-oriented business with a source of capital that's right in front of us in the form of the outpatient medical assets. And so our expectation is the business will grow and mature, and our G&A will be in line or better. Juan Sanabria, Analyst at BMO Capital Markets Great, thank you.

Mark Decker, Chief Executive Officer & Director Thanks, Juan. OPERATOR Our next question comes from Wes Golladay with Baird. Wes Golladay, Analyst at Baird Hey, good morning, everyone. Maybe a follow-up to Juan's question on the development parcel.

Do you have an idea what you want to do? Would it be an adult, or would it be more up the acuity curve, and maybe talk about the competitive landscape in that market? Okay. And then maybe going back to the team build-out.

Do you have the team in place? Are you still looking to fill any positions? And then last one for me: you know, you have made the pivot to senior housing, but you're still remaining opportunistic in OM. Is that going to be part of the playbook going forward?

Mark Decker, Chief Executive Officer & Director Yeah, again, I think you're probably overemphasizing a 1% investment, but it's your time, so I'll— I mean, yeah, it would be a likely full-continuum community. It's kind of right down the middle of the fairway in terms of demographics. And I would expect we'll come up with some thoughtful way to partner with someone on an earnings-oriented manner. We're in—I think we're in a great spot.

Yeah, I mean, I think the playbook is really to try to generate the best returns on capital possible and work with partners who value what we're up to. But I mean, we're very focused, proportionally, on senior housing. Wes Golladay, Analyst at Baird Okay, thanks a lot. Mark Decker, Chief Executive Officer & Director Thank you.

OPERATOR Our next question is from Dave Rogers with Raymond James. Dave Rogers, Analyst at Raymond James Yeah, good morning, Mark. Wanted to follow up, I guess, on some of those same questions, but you mentioned valuation in your opening and, setting aside the right value for now, historically in the space, best way to highlight value—eliminate loans, eliminate mezzanine, eliminate joint ventures—get to a clean portfolio and kind of highlight that. And obviously some of the steps in the quarter aren't going in that direction.

So I guess, do you see just a longer exit than maybe people have originally anticipated from your comments on the outpatient medical? Is it that you're trying to kind of maintain some level of earnings or cash flow for debt coverage? I mean, what's the rationale, I guess, for staying involved in these businesses given how good seniors is today? Mark Decker, Chief Executive Officer & Director You're talking about the two loans?

Dave Rogers, Analyst at Raymond James Yeah, I mean a combination of the loan, the active adult, and just kind of like where do you want to be in that spectrum? And again, the IRF JV that you did—why not exit that outright? You know, why stay in some of these businesses? I think it's kind of what, you know, the question of why continue to allocate capital there, even though you sold them, you're still allocating capital to the IRFs as opposed to allocating that full capital into seniors.

Mark Decker, Chief Executive Officer & Director Yeah, fair question. I mean, listen, I think—I don't know what everyone's expectations are for the axis of how long this will take, but I think it's reasonable to assume it'll take, you know, more time than immediate. And, you know, some of these things, it just depends. I mean, if you think about the IRF business, that's really a niche within a niche, and there is some kind of middle-duration leasing work to be done there.

That is how we think we optimize value and get the best price. You know, that's a space where investors want some expertise, so they valued our expertise there. We think that there is an opportunity to reset those leases, but it isn't today—it's four and a half years from now. So I think to get the execution we got there, which was outstanding from a cap rate and valuation perspective, that's what we needed to do to drive the best value for the company.

And that's really how we're focused. So I think you'll continue to see that.