Seniors Housing Weekly Update - Seniors Housing Occupancy Trends Still Improving
October 14, 2014
October 14, 2014. 60 Seconds with Steve Monroe. The data metrics are looking so good they may be attracting unwanted competition...
Seniors Housing Occupancy Trends Still Improving
Is good news sometimes bad news? Take the recent statistics from NIC MAP that show occupancy, annual rent growth and annual absorption all continuing to rise, while construction as a percentage of inventory declined by 10 basis points in the third quarter. For an existing operator, this is all good news and confirms the continued strength of the seniors housing sector. These numbers would indicate an ability to raise rates and increase cash flow. Combined with interest rates going nowhere anytime soon, life is good. But it is a double-edged sword, as all this good news continues to bring in more novice developers. Just yesterday I received a call from yet another multifamily developer with land in a town that has a 100% occupied assisted living community. Of course, he sees opportunity, and wants to develop 30 to 40 units. Will they fill? Or will the town end up with two 80% occupied buildings? That is clearly the unknown, and clearly the fear. Presumably, the best care will prevail, at least I hope.