2023 ends with a 2.4 percentage point increase
ANNAPOLIS (January 11, 2024) – The senior housing occupancy rate for the 31 NIC MAP Primary Markets increased 0.8 percentage points from 84.3% in the third quarter of 2023 to 85.1% in the fourth quarter of 2023, according to data released by NIC MAP Vision and analyzed by the National Investment Center for Seniors Housing & Care (NIC). The occupancy rate has increased 7.3 percentage points from a pandemic-related low of 77.8% in the second quarter of 2021, bringing occupancy to less than two percentage points below the pre-pandemic level of 87.1% in the first quarter of 2020.
The fourth quarter of 2023 represents the 10th consecutive quarter of occupancy gains, driven by record-high rates of demand. Fourth quarter net absorption was more than 8,400 units across the Primary Markets, the highest quarterly level observed in 2023.
Demand outpaced supply in both assisted living and independent living properties within the NIC MAP Primary Markets in the fourth quarter, driving occupancy rates higher. The assisted living occupancy rate improved 0.9 percentage points from the prior quarter to 83.4%, while the independent living occupancy rate improved 0.8 percentage points to 86.8%. As a result, occupancy rates were only 1.1 and 2.8 percentage points from pre-pandemic levels for assisted living and independent living, respectively. For the 68 NIC MAP Secondary Markets, however, occupancy within assisted living properties fully recovered, with the fourth quarter occupancy rate 1.2 percentage points above its pre-pandemic level of 84.2%.
While occupancy and absorption levels are trending upward, higher costs of capital and challenged lending environment conditions continue to weigh on new supply. Senior housing inventory for the Primary Markets grew by 0.4% or 2,920 units from the prior quarter. Year-over-year inventory growth was 1.4%, near its smallest year-over-year increase since 2012.
“At this pace, we anticipate occupancy recovery to pre-pandemic levels in the second half of 2024,” said Caroline Clapp, senior principal with NIC. “If this environment of robust absorption coupled with relatively moderate new inventory continues, owners and operators will need to determine when to jumpstart new construction to meet consumer demand.”
Boston (90.7%), Baltimore (88.6%), and Minneapolis (88.1%) had the highest occupancy rates of the 31 NIC MAP Primary Markets, while Houston (79.3%), Atlanta (81.8%), and Las Vegas (82.1%) recorded the lowest.
A summary of the NIC MAP Market Fundamentals Data, released by NIC MAP Vision, is below. The Market Fundamentals report will be available at 4:30 p.m. ET on Thursday, January 11, 2024.
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About the National Investment Center for Seniors Housing & Care
The National Investment Center for Seniors Housing & Care (NIC), a 501(c)(3) organization, works to enable access and choice by providing data, analytics, and connections that bring together investors and providers. The organization delivers the most trusted, objective, and timely insights and implications derived from its analytics, which benefit from NIC’s affiliation with NIC MAP Vision, the leading provider of comprehensive market data for senior housing and skilled nursing properties. NIC events, which include the industry’s premiere conferences, provide sector stakeholders with opportunities to convene, network, and drive thought-leadership through high-quality educational programming. For more information, visit NIC’s website and follow NIC on LinkedIn and Facebook.
About NIC MAP Vision
NIC MAP Vision maximizes access, choice, and quality in senior housing by providing data, analytics, and services to industry stakeholders and partners. We are the only intelligence provider exclusively dedicated to senior housing. As the industry’s gold standard for market analytics data, we are trusted by the largest government agencies, 18 of the 20 largest senior housing operators, and most of the largest investors and owners. Every day, thousands of industry professionals use our data platform and proprietary tools to make smarter decisions about where to grow, how to grow, and how to bring a strategy to life. For more information, visit https://www.nicmapvision.com/