Low Occupancy Rates and Competition: The senior living industry is highly competitive, and Sonida's ability to attract and retain residents is crucial. Factors like new developments, local market saturation, economic downturns, and public health crises (e.g., pandemics) can significantly depress occupancy levels, directly impacting revenue and profitability.

Labor Shortages and Wage Inflation: The senior living sector faces persistent challenges in recruiting and retaining qualified staff, particularly nurses and caregivers. Rising wage demands, increased benefit costs, and competition for talent can lead to higher operating expenses, staffing shortages affecting quality of care, and potential regulatory non-compliance.

High Debt Levels and Interest Rate Risk: Sonida Senior Living carries substantial debt. An increase in interest rates would raise debt service costs, reducing cash flow available for operations, capital expenditures, or debt reduction. This also limits financial flexibility and increases refinancing risk.