S&P Global Ratings on Wednesday revised Sabra Health Care REIT Inc.'s outlook to positive from stable, while reaffirming the company’s BB+ issuer credit rating and the BBB- issue-level rating on its senior unsecured notes. The rating agency attributed the outlook change to a strengthened credit profile driven by Sabra’s larger managed senior housing platform and favorable credit metrics.
Over the past year Sabra expanded its managed senior housing portfolio from 60 consolidated properties to 90. That expansion contributed to same-property cash net operating income growth of 14.4% for the period noted by S&P Global Ratings. The company financed the growth primarily through forward at-the-market equity issuance and borrowings under its revolving credit facility.
As of March 31, 2026, Sabra’s S&P Global Ratings-adjusted debt to EBITDA stood at 5.4x. The rating agency expects this leverage measure to improve to about 5.0x by year-end, and projects a modest step down into the low-5x area over the next 12 months if current trends continue.
Sabra reported it has closed or been awarded $400 million in investments year to date and is actively pursuing an additional $690 million of managed senior housing opportunities. S&P Global Ratings expects the REIT’s net investment activity for 2026 will materially exceed the roughly $500 million it invested in 2025.
Investment activity in the first quarter of 2026 totaled approximately $96 million, bringing Sabra’s gross investments to about $6.6 billion. Those assets span 395 properties across 40 U.S. states and Canada. The company also noted a structural shift in its payor mix: for the first time in its history, private-pay revenues will form more than 50% of the payor composition, driven by the ongoing build-out of the senior housing operating property platform.
S&P Global Ratings framed its revised outlook around the expectation that Sabra will continue to grow the operating property portfolio while preserving disciplined leverage and robust tenant coverage metrics. The agency reiterated its view that Sabra’s adjusted debt-to-EBITDA ratio should trend modestly downward to the low-5x area over the coming year.
Contextual analysis
By increasing the share of operating senior housing properties and shifting payor mix toward private-pay revenues, Sabra is altering the composition of its revenue base and asset mix. That asset-mix change is the principal factor S&P Global Ratings cited in advancing the outlook, while the company’s recent investment cadence and pipeline underpin the agency’s projection of stronger net investment activity in 2026 compared with 2025.
The ratings action preserves the existing credit assessments but signals that the rating agency sees improving credit fundamentals if Sabra continues its current strategy and delivers the expected leverage improvement.