More than 630 professionals registered for a recent NIC Senior Housing Credit & Investment Outlook webinar held on March 26th. Attendees received updates on the latest sector market fundamentals supporting a positive outlook along with insights on loan maturities, delinquency rates, and investment performance. NIC staff shared the latest data points and guest panelist, Aaron Becker, Senior Managing Director, Head of Seniors Housing & Healthcare Production with Lument, provided perspective on the momentum their firm is seeing with transaction activity and new investors entering the space.
Key takeaways from the webinar include:
- Short Term Outlook: Positive
- The senior housing sector can anticipate rising occupancy throughout the year with limited new competition coming onto the market. These tailwinds will continue to boost NOI margins.
- Medium-Term Outlook: Positive, but Guarded
- Beyond this year, forecasts are for continued rising occupancy and strong demand as development activity will likely remain muted. Both of these support ongoing boosts to NOI margins.
- The guarded sentiment reflects uncertainty related to economic unknowns, many related to changes related to actions of the current administration (e.g. tariffs).
- Long-Term Outlook: Positive
- The strong demand for senior housing and care will be sustained by significant growth in the aging population. This outlook is positive, assuming supply and demand remain balanced. Undisciplined, rapid growth following the current period of record-low construction could be disruptive.
- Active Adult, while currently much smaller in inventory than senior housing overall, has the opportunity to expand penetration rates for senior housing options.
- NIC forecasts occupancy across the primary and secondary markets to be roughly 91% by the end of 2026.
- There is an estimated $10.94 billion in senior living loan maturities in 2025.
- The delinquency rate on senior housing CMBS loans was 2.1% in February, below multifamily overall, but higher than the 1.66% delinquency rate in September 2024.
- Senior housing investments outperformed the broader NCREIF Property Index in the fourth quarter of 2024.
Visit NIC.org to watch a replay of the webinar.