The following analysis examines initial rate growth and discounts offered compared to asking rates across all senior housing care segments. Additionally, the analysis explores initial rate growth patterns within select NIC MAP® metropolitan markets reported by NIC MAP Vision. 

Key Takeaways:  

• Initial rate growth remained robust and near record highs for assisted living and memory care but showed a slight deceleration for independent living. 
• Some markets saw negative year-over-year rate growth in initial rates in December 2023, contrasting with December 2022, when rates were positively growing, often in the double digits. 
• Average initial rate growth is expected to align with inflation in 2024, based on historical trends. 
• Discount strategies are being employed to offset higher initial rate growth and attract new residents.  
• The pace of move-ins appears to be a factor influencing these pricing strategies. 
• Independent living had the lowest average pace of move-ins in 2023, while memory care had the highest, followed by assisted living. 
• Discounts increased in independent living, held steady in assisted living, and declined in memory care. 
• In 2023, a NIC analysis revealed differences in rate increases and their effects on demand growth and occupancy recovery between independent living, often a lifestyle choice, and assisted living/memory care segments, which are primarily need driven. This trend is consistent across discount strategies. 

The Pace of Growth in Initial Rates Remained Robust and Near Record Highs for Assisted Living and Memory Care but Showed a Slight Deceleration for Independent Living 

For the independent living segment, average initial rate growth peaked during the annual period ending December 2021, with the largest annual growth (7.1%) among all senior housing care segments. However, this pace of growth decelerated in the following annual periods ending December 2022 (5.4%) and December 2023 (6.3%), with initial rate growth being the lowest compared with assisted living and memory care segments.  

This deceleration may be partly attributed to relatively slow move-ins for independent living and increased competition from active adult properties. Notably, the pace of move-ins for independent living averaged around 2.3% of inventory in 2023, less than that of assisted living (3.3%) and memory care (3.6%). 

The assisted living segment experienced relatively higher year-over-year increases in average initial rates compared to independent living in December 2022 and December 2023, with 8.0% and 8.5%, respectively. 

The memory care segment showed the largest year-over-year increase for initial rates among the three care segments, with an 8.3% increase in December 2022 and an 8.9% increase in December 2023.  

In December 2023, the average initial rate for an independent living unit was $3,702, translating to $44,424 annually. For an assisted living unit, the average initial rate was $6,017, equivalent to $72,204 annually. For a memory care unit, the average initial rate was $7,899, equivalent to $94,788 annually. 

Separately, inflation rates, as measured by the Consumer Price Index (CPI), were 7.0% in December 2021, 6.5% in December 2022, and 3.4% in December 2023. Despite a noted easing of inflation, initial rate growth for all segments continued to outpace inflation as of December 2023, indicating that senior housing operators maintain the upper hand in pricing.  

While these rate adjustments are being made to account for increased care and operating costs due to inflation, the pace of growth in rates is expected to align with inflation at some point in 2024. This projection is based on historical trends and the observed 6-to-9-month lag between rate growth and inflation that was observed in 2022. 

Discounts and Initial Rate Growth Vary by Care Segment and Market

Interestingly, some markets experienced negative year-over-year growth in initial rates in December 2023. For example, in the assisted living segment, Cincinnati, OH and Dallas, TX, saw declines of 7.1% and 1.8%, respectively. Similarly, Detroit and Houston experienced decreases of 15.6% and 7.3%, respectively, in the memory care segment. This contrasts with December 2022, when year-over-year growth in initial rates across these markets and care segments was positive, often in the double digits. 

Discounts Increased in Independent Living, Held Steady in Assisted Living, and Declined in Memory Care 

In 2023, a NIC analysis revealed differences in rate increases and their effects on demand growth and occupancy recovery between independent living, typically a lifestyle choice, and assisted living/memory care segments, which are primarily need-driven. This trend is consistent across discount strategies.

In the independent living segment (frequently more of a lifestyle choice than need-driven), discounts between asking rates and initial rates have been increasing since December 2019. averaging 10.3% or $424 off the asking rate in December 2023, equivalent to 1.2 months on an annualized basis. 

Initial rate discounts compared with asking rates in the assisted living segment were relatively lower and remained generally consistent with discounts offered since 2019, averaging 6.3% or $404 in December 2023, equivalent to 0.8 month on an annualized basis.  

In the memory care segment, discounts between asking rates and initial rates averaged 7.1% in December 2023, equivalent to $606. Despite the relatively higher rate increases for the memory care segment, annualized discounts have been decreasing in the last two years, from 1.2 month in December 2021 to 0.9 month in December 2023. 

These trends and patterns also suggest that the pace move-ins – lowest independent living and highest in memory care – had some impact on the discounts being offered. 

In conclusion, the analysis raises some important questions: Are these pricing strategies sustainable? What is the long-term effect of these discount strategies on resident retention and the pace of move-ins and move-outs? Will senior housing properties maintain the upper hand in pricing as inflation continues to moderate? 

Additional key takeaways are available to NIC MAP Vision subscribers in the full report.  

NIC MAP Vision continues to work to onboard new data contributors and is dedicated to reporting more metropolitan markets. It is only with the support of Actual Rates data contributors and officially certified Actual Rates software partners that expanded metro-level reporting is now available. For more information on which metropolitan markets are now available to NIC MAP Vision subscribers, please contact a product expert at NIC MAP Vision today.   

About the Report  

The NIC MAP Vision Seniors Housing Actual Rates Report provides aggregate national data from approximately 300,000 units within more than 2,700 properties across the U.S. operated by 35 to 40 senior housing providers. The operators included in the current sample tend to be larger, professionally managed, and investment-grade operators as we currently require participating operators to manage 5 or more properties. Note that this monthly time series is comprised of end-of-month data for each respective month, and that the set of properties included in each month’s data set is subject to change. The sample is not “same store,” and occupancy is inclusive of newly opened properties in lease-up. NIC MAP Vision is working on including same-store rate metrics in a future release.  

Interested in Participating?  

The Actual Rates Data Initiative is an effort to expand senior housing data and we are looking for operators who have five or more properties to participate. NIC MAP Vision has expertise in extracting data from industry leading software systems, such as Aline, Alis, Eldermark, MatrixCare, Move-N, PointClickCare, Vitals, and Yardi and can facilitate the process for you.   

Operators contributing data to the actual rates report receive a complimentary report which allows them to compare their own data against national and metropolitan market benchmarks. In addition to receiving a complimentary report, your organization benefits through:  

• More informed benchmarking, strategic planning, and day-to-day business operations,  
• Increased transparency, aligning with other commercial real estate assets in terms of data availability, 

• Saved time, Actual Rates data is collected electronically directly from operators’ corporate offices, removing the need for telephone calls to individual properties, and  
• Enhanced investment and efficiency across the sector.  

Visit NIC MAP Vision’s website for more information.  

As we venture through 2024, the skilled nursing sector is preparing to navigate the challenges and seize the opportunities that lie ahead. The sector is focused on securing increased funding, enhancing public education about the sector, and addressing the ongoing workforce challenges. 

Many skilled nursing experts project that 2024 may be a critical juncture for the industry. The growth of the aging population is expected to lead to increases in occupancy rates for skilled nursing operators.  According to the fourth quarter 2023 data from NIC MAP Vision, at82.7%, skilled nursing occupancy has recovered 9.3 percentage points from the pandemic low (1Q2021, 73.4%), but is still 3.5 percentage points below 1Q2020 levels. 

Given the challenges such as continued occupancy below pre-pandemic levels, operators have had to pivot and adjust to a more difficult operating environment in recent years. 

Many operators have increased focus on key operational improvements during this time. Operators are implementing strategies to enhance efficiencies and concentrating on staffing headwinds. For example, strategies that utilize data to drive outcomes with the assistance of Artificial Intelligence (AI) have proven beneficial. Many believe AI has the potential to reduce routine administrative burdens, guide clinicians to better outcomes, and improve the quality of care. Additionally, there is an aim to increase clinical competency among staff through enhanced apprenticeship programs and internal educational courses. Efforts are also being made to address staffing issues by focusing on diversity, equity, and inclusion initiatives.  

A positive for the sector has been the increase in Medicaid reimbursement rates in many states. The increases have been essential in mitigating expense pressure for operators. However, some believe there is a possibility the sector will face financing threats due to the recalibration for Medicaid rates. In an attempt at budget neutrality, states typically withdraw funds that they initially allocated, in an effort known as “recalibration.” If this comes to fruition, it could pose more of a challenge for rural and smaller skilled nursing properties, rather than to larger ones. Many would also agree that while these increases have been beneficial, they have lagged for many years and, in many cases, still do not fully cover the cost of care provided.  

As mentioned above, expense pressure is palpable, and this is leading to the squeeze in profit margins. This is due to a combination of factors, including continued wage-related and workforce expenses, rising interest rates and general inflationary cost increases. These economic pressures are driving up operating costs, thereby reducing the profitability of skilled nursing properties.  

Another factor contributing to the margin squeeze is the growth of Medicare Advantage. The growth of Medicare Advantage (MA) plans has been challenging for operators, impacting margins, and sometimes leading to issues of high claims denials for service providers. High claim denials can result in an additional administrative burden during a time when nursing home staff is already stretched thin, in addition to increasing expenses due to higher bad debt items. Furthermore, operating revenue is pressured due to lower Medicare Advantage reimbursement compared to Medicare Fee-for-service. The Medicare versus Managed Medicare differential from the October NIC MAP Vision Skilled Nursing Data Report revealed that MA plans were reimbursing $123 less per patient day compared to traditional Medicare. The disadvantages of MA plans to providers have led a number of skilled nursing entities to explore ownership of their own MA plan and other value-based care arrangements where there is the potential for upside risk.  

Last, there are concerns regarding the proposed federal staffing mandate as the sector continues to strive for better quality of care. Many believe this mandate could potentially compromise the quality of care and limit accessibility for many Americans, in addition to causing significant financial viability problems and potentially resulting in the closure of additional properties. 

While there are demographic tailwinds, skilled nursing operators are facing a multitude of challenges in 2024. However, with strategic planning and effective advocacy, operators can navigate these challenges and continue to provide quality care for their residents. The industry remains hopeful that with predictable funding, long-term solutions to some of the most critical problems facing the industry can be addressed, ensuring the quality care our seniors deserve and paving the way for a sustainable future for skilled nursing services. 

NIC Analytics released the 3Q 2023 NIC Lending Trends Report today. The complimentary quarterly report includes data trends over seven years for senior housing and nursing care construction loans, mini-perm/bridge loans, and permanent loans from 3Q 2016 through 3Q 2023. 

Third Quarter 2023 and Beyond: Market Forces Recap

The Federal Reserve nudged rates higher by another 0.25 percentage points (pps) in July 2023, bringing the federal funds rate to a target range of 5.25% – 5.50%. This was the eleventh rate hike since March 2022. Concurrently, the consumer price index (CPI), has decelerated since June 2022, reaching 3.0% in June 2023 before rebounding to 3.7% in August and September of 2023.

Despite a noted easing of inflation in the past year, the Federal Reserve acknowledged its persistent elevation. Since July 2023, the Federal Reserve held rates steady for four consecutive meetings, including the most recent one in January 2024. The omission of any mention of further rate hikes in the Federal Reserve’s statement suggests a more balanced outlook regarding the risks associated with reaching its employment and inflation targets. However, the central bank remains vigilant about adjusting monetary policy as needed to address emerging risks.

Looking ahead, the expectation is for any potential rate cuts to occur gradually, involving SMALL incremental adjustments. The goal is to recalibrate and align interest rates with inflation to support overall economic health and mitigate inflationary pressures or deflationary risks.

Escalating loan expenses due to higher interest rates are impacting senior housing property assets, creating challenges for many and distress in certain others. The sector anticipates billions of dollars maturing this year. While some may endure the repercussions of high interest rates, more stability is anticipated in 2025 for those that can weather the current conditions, with an expected improvement in capital market conditions, occupancy, and NOI outlook.

The lending environment for senior housing and nursing care in the third quarter of 2023, although tighter compared to 2020, showed relatively similar conditions to the second quarter 2023 with some adjustments from both borrowers and lenders.

Takeaways from the 3Q 2023 NIC Lending Trends Report

The issuance of new permanent debt for senior housing increased during the third quarter 2023. For the sample of lenders in the NIC Lending Trends Report, the volume of new permanent loans closed for senior housing surged to $1.43B, marking a 150% increase from the prior quarter. This increase suggests that some lenders and borrowers are likely adjusting to changing capital market and credit conditions and locking in long-term interest rates. However, the levels remained relatively low compared to the high volumes observed pre-2020.

The decline in mini-perm/bridge debt issuance for senior housing persisted and reached time-series low, reflecting a further 46% decrease from the prior quarter and 87% from late 2022 levels. Similarly, nursing care mini-perm/bridge loan closings, while slightly higher than those in senior housing for the past two consecutive quarters, remained relatively low and on par with pre-pandemic levels. Borrowers continue to adjust to the prevailing “higher for longer” mindset, anticipating sustained rates without a potential decline in the near future. While short-term debt options are limited, those available often come with increased costs and additional credit enhancements e.g., the need for more equity or a repayment guaranty.

New construction loan closings for senior housing subdued to weak levels and hit a new low within the time series in the third quarter of 2023. This is evident in construction starts which remained relatively feeble in the third quarter of 2023, and the number of senior housing units under construction in the 31 NIC MAP Primary Markets which remained near its lowest level since 2015, according to data released by NIC MAP Vision.

This notable decline suggests a trend of diminishing confidence in a quick construction market correction. Despite this, the consensus points towards mid- or late-2024 as the most likely period for senior housing construction starts to reach their lowest point. 

As for nursing care, the issuance of construction debt was virtually non-existent for the lenders sampled in the Lending Trends Report. This aligns with the observed pattern of limited debt financing for new nursing care property construction since NIC began data collection in 2016.

The total balance of delinquent loans for senior housing saw a notable increase to time-series high. Delinquencies in senior housing rose by 50% in the third quarter 2023 while those in nursing care declined by 38% from the prior quarter. Delinquencies as a share of total loans rose to 4.3% for senior housing, up from 2.9% in the second quarter of 2023 and 1.3% in late 2022. For nursing care, the delinquency rate edged down to 0.6% from 1.1% in late 2022. Note that loans in forbearance are reported in the delinquent loan data for some debt providers. Also of note, foreclosures were reported for the sample in third quarter 2023 for both senior housing and nursing care, $20.2M and $14M, respectively.

From the Field: 3Q 2023 Survey Comments

For the past three quarters, NIC Analytics has reached out to our network of lender data contributors to this report, asking them questions about the lending environment for senior housing and nursing care. We are asking about their strategies in response to changing capital market conditions, lending patterns with respect to existing versus new clients, and any notable trends they are observing in the market.

In the face of changing capital market conditions, the responses in the third quarter 2023 were diverse. Approximately two-thirds reported tightening lending standards, but credit requirements aligned with the first half of 2023, while a third maintained base credit standards but focused on strong sponsorship and credits opportunities due to reduced credit availability from banks. As the exhibit below shows, over the past three years, there has been a decline in the share of loan volume closed by banks and other lenders, juxtaposed with a rise in the share of loan volume closed by government-related sources (based on this sample of lenders captured by NIC).

The third quarter of 2023 also prompted greater focus on long-term relationships with many lenders extending loans predominantly to existing clients, acknowledging persisting challenges posed by rising short-term and long-term interest rates, staffing issues, slow census recovery in some cases, and inflationary increases in operating costs. Although some lenders onboarded new clients despite tightened lending standards.

Additionally, lenders noted that many properties displayed improved three-month NOI over 12-month NOI, but the surge in interest rates and cap rate trends sometime offsets potential loan proceeds. Further, the impact of higher interest rates caused some loans to become debt service constrained and resulted in adjustments to requested loan amounts to meet minimum DSCR requirements.

In conclusion, the third quarter “from the field” survey reflects the adaptability of senior housing and nursing care lenders and borrowers to new economic realities in the face of shifting market conditions. The industry grapples with a balancing act – tightening standards to navigate challenges while seeking opportunities to position themselves for the road ahead.

Download the complimentary 3Q 2023 NIC Lending Trends Report for full details on these and other trends in senior housing and skilled nursing lending. 

Note: These data are not to be interpreted as a census of all senior housing and skilled nursing lending activity in the U.S., but rather reflect lending activity from participants included in the survey sample only. 

The 4Q 2023 NIC Lending Trends Report is scheduled for release in mid-May 2024.

Interested in participating? The NIC Lending Trends Report helps NIC Analytics to deliver on NIC’s mission to enable access and choice by further enhancing transparency of capital market trends in the senior housing and care sectors. We very much appreciate our data contributors. This report would not be possible without them. 

If you would like to participate and contribute your data, please contact us at analytics@nic.org. As a courtesy for providing data, data contributors receive this report ahead of its publication on the website. The information provided as part of the survey will be kept strictly confidential. Individual answers will be combined with the answers of all other respondents. Data acquired from this survey will only be reported in the aggregate, and therefore, the resulting aggregated data will not be attributed to you or your company upon distribution.

Keen senior housing investors have a growing pool of opportunities that span the risk spectrum, at dislocated pricing, set against the backdrop of one of the most compelling fundamental stories in the real estate sector. This dynamic may accelerate in the coming months as several compounding forces coalesce to motivate sellers to strategically evaluate options, including to transact.

What is Currently on Market

The majority of deals on market can be widely categorized into two major groups: operating performance-driven and capital stack-driven.

Operating performance-driven sales encompass: 1) newer vintage assets, delivered just before or during the pandemic, experiencing a protracted or stalled lease-up, 2) older vintage assets that have lost market positioning, or 3) assets in currently saturated markets where supply has outstripped demand. Addressing the underperformance can involve resetting loan-to-values, requiring additional capital infusion, sales by tired equity capital, or sales by lenders who have lost confidence, in some cases accepting discounted payoffs.

Capital stack-driven sales, on the other hand, stem from challenges in capital composition. On the equity side, end-of-fund life issues, showcasing wins for the next fund raise, or addressing redemption backlogs is leading to sales. On the debt side, near-term maturities, expiring interest rate hedges, and a sudden increase in the cost of debt, are driving sales despite otherwise performing operations.

What to Expect for 2024

The capital markets have remained tight to start off the year. Sellers anticipating a downward trend in the UST 10Yr have witnessed a reversal in fortunes so far. As a recent Wall Street Journal article aptly titled “Investors Are Almost Always Wrong About the Fed,” sellers waiting on favorable capital markets may have to contend with a different reality. Coupled with mounting capital challenges on both the debt and equity fronts, this may accelerate the opportunities outlined earlier.

In addition to the prevailing factors, several other forces are set to intensify and converge in the coming months that may drive deal volume. First, according to NIC, there are $18 billion of senior housing loans maturing in 2024 and 2025. Second, expiring interest rate hedges in a still-elevated rate environment are straining levered free cash flows. Third, senior housing continues to garner interest from institutional equity, attracting both new entrants that have already signaled allocations and a reinforced commitment from existing groups. According to JLL Research, there is $402 billion of dry powder waiting to be deployed in commercial real estate. Given the attractive risk-adjusted-return profile for senior housing, there may be an escalating number of newcomers to the space which could fuel an even larger appetite for deals.

Investors who do transact stand to benefit not only from dislocated pricing, but also from participating in the positive fundamental growth story unfolding in the senior housing sector. Operational metrics continue an upward trajectory, with occupancy in the NIC MAP Primary Markets reaching 85.1%, marking the tenth consecutive quarter of gains. Occupied units in primary markets sit at ~599K – ~30K units higher than pre-pandemic.

In terms of supply, the backlog of delivering product continues to shrink while new starts continue to dwindle due to debt availability and still elevated construction costs. Construction starts were 2,221 units for the Primary and Secondary Markets in the fourth quarter 2023 – the lowest number since the second quarter 2009. Contractor bids remain elevated in a still tight labor market for skilled workers. The costs for raw and finished goods have seen some relief recently, but it may be short lived as geopolitical pressures have caused notable disruptions in the global supply-chains. Trans-Pacific shipping rates surged 24% sequentially in the week ended January 31st, according to the Drewry Hong Kong-Los Angeles benchmark. This index is up 338% from last year. Combined with lowered loan-to-costs, the substantial decrease in starts is likely to persist for the near future. On the demand side of the equation, in recent research by NIC MAP Vision, it was reported that to maintain the current market penetration rates, the sector will need 806,000 additional units by 2030.

The dynamics in play are set to create an active transaction environment in 2024 for investors spanning the cost of capital spectrum amidst increasingly favorable fundamentals with tailwinds for the foreseeable future.

Sources:

1. 4Q23 NIC MAP® Market Fundamentals Data
2. “Investors Are Almost Always Wrong About the Fed”, The Wall Street Journal, https://www.wsj.com/finance/investing/investors-fed-interest-rates-a842073c?tpl=cb&mod=hp_lead_pos2
3. “Containerliner Rates Climb as Red Sea Hostilities Intensify”, Bloomberg, https://blinks.bloomberg.com/news/stories/S84R91DWRGG0

Amid favorable supply and demand market dynamics, 2024 presents a golden opportunity for senior housing communities to bolster occupancy rates and drive operational growth, thereby mitigating some of the challenges posed by capital market conditions. 

NIC Analytics recently published its first occupancy stratification report, focusing on the stabilized occupancy¹ distribution within the senior housing sector in 2023. The report reviews how senior housing communities are faring after 10 quarters of occupancy growth and recovery, fueled by a combination of robust demand and moderate new supply, reflected in the absorption to inventory velocity (AIV Ratio).  

The report offers an outlook for stabilized occupancy in 2024 and examines stabilized occupancy distribution in 2023 across various dimensions, including NIC MAP market aggregates, regional variations, chain sizes, community types, payment types (CCRCs), community sizes, community ages, campus types, and profit statuses. Additionally, it provides occupancy distribution across select NIC MAP Primary and Secondary Markets.  

The past three years have seen a remarkable resurgence in demand for senior housing as the markets registered the strongest unit improvement in net positive absorption, as measured by the change in occupied stock, since NIC MAP began reporting the data back in 2005. Not surprisingly, however, the pace of occupancy recovery varies across communities, markets, and other dimensions tracked by NIC MAP Vision. 

2024 Stabilized Occupancy Outlook: Average and Distribution. 

In 2019, prior to the onset of the pandemic, 17% of senior housing communities in the 99 NIC MAP Primary and Secondary markets had stabilized occupancy below 80%. While the sector has made notable strides in occupancy recovery and is on record to return to and surpass pre-COVID occupancy levels by the end of 2024 on average, there remains a group of communities that continue to face challenges.  

Specifically, 23% of senior housing communities are still reporting occupancy rates below 80% as of the fourth quarter of 2023. Such stabilized occupancy levels below 80% are likely to pose challenges, particularly given the current capital market conditions and the resulting lending environment as well as higher operating costs. 

The NIC Analytics outlook for 2024 suggests a notable improvement in the overall stabilized occupancy distribution by the fourth quarter. Notably, 85% of senior housing communities are expected to have occupancy levels of 80% or higher by the fourth quarter of 2024, slightly exceeding the share seen in fourth quarter 2019. In contrast, 13% are expected to remain within the 60–80% occupancy range, while another 2% are expected to have occupancy below 60%.  

By the fourth quarter of 2024, the stabilized occupancy rate for senior housing communities in the 99 NIC MAP Primary and Secondary Markets is expected to reach approximately 90% on average.  

Capitalizing on 2024 to Increase Occupancy and Align with the Broader Trend of Occupancy Recovery

Since the first quarter of 2020, NIC Analytics has been tracking the recovery of stabilized occupancy across the 99 NIC MAP Primary and Secondary Markets by looking at the share of “same-store” senior housing communities that have achieved pre-pandemic stabilized occupancy levels and those that are still in the process of recovery. Same-store is defined as senior housing communities that have been open and reporting data at least since 1Q 2020. Within the 99 Primary and Secondary Markets, a total of 7,521 same-store senior housing communities were identified. Closed and newly opened properties since 1Q 2020 have been excluded from this second part of the analysis.

The exhibit below shows that 1Q 2020 stabilized occupancy levels have been achieved or surpassed as of 4Q 2023 in nearly half (46% – equivalent to 3,500 communities) of same-store communities within the 99 Primary and Secondary Markets. Additionally, a marginal 1% of communities are within less than 5 percentage points (pps) of returning to their pre-pandemic occupancy rates.

By contrast, as of 4Q 2023, roughly one third of communities (more than 2,400) still lagged behind their 1Q 2020 stabilized occupancy levels, with a 5 to 10pps range of recovery. Additionally, 21% of communities (more than 1,500) still have a gap of over 10pps to bridge in order to reach 1Q 2020 occupancy levels.

While each of these communities faces its unique set of challenges contributing to a slow recovery process, overarching challenges and opportunities emerge at the market level.

Competition from New Entrants: The emergence of newly opened communities presents competition, capturing a portion of the market share and potentially prolonging the occupancy recovery process for some stabilized communities.

Leveraging Favorable Market Dynamics to Increase Census: Amidst record levels of demand and moderate new supply expected to continue through 2024, senior housing communities with lagging occupancy rates are presented with a prime opportunity to capitalize on market dynamics and enhance census and occupancy levels.

While currently construction starts are low and inventory growth remains moderate, consensus suggests a regained pace by the end of 2024. Consequently, competition from newly opened properties is expected to grow.

2024 presents a golden opportunity to increase occupancy amid favorable market dynamics.

Download the 2023 NIC Stabilized Occupancy Stratification Report

¹Stabilized occupancy is defined by NIC MAP as the occupancy of properties that are (a) at least two years old, or (b) if less than two years old, properties that have achieved occupancy of at least 95.0% since their opening.