Dave Sedgwick, president and CEO of CareTrust REIT, Inc. (NYSE: CTRE), participated in a video interview at Nareit’s REITworld: 2022 Annual Conference held in San Francisco on Nov. 15-17.
Sedgwick talked about the current “unique” economic environment heading into a recessionary period with high interest rates, noting that health care is typically a hedge against a recession.
“[When] you think about health care, demand stays the same whether there’s a recession or not, and pricing stay the same,” he said. “But typically costs get a little bit better as labor loosens.”
Sedgwick discussed how although CareTrust’s properties have a large distribution in Texas and California, the REIT is open to acquisitions in any area based on the quality of the operators there.
“The decision for us for an investment is less about the state and it’s really more about the operators,” he said. “Is this somebody that we can really grow with and trust to take care of our residents and patients?”
Sedgwick said that CareTrust published its first Corporate Social Responsibility report in 2020 as a response to investor questions. As a triple net landlord though, CareTrust does not control operations at its facilities.
“We have to go about it in sort of a different way [and] get creative—to educate and incentivize our operators to make investments in the properties in the most sustainable way,” he said.