From The Magazine

Confluent Builds for the Future

by Jeff Shaw November 27, 2023

With a $500 million pipeline, the developer is one of the few currently working on ground-up construction projects. By Jeff Shaw With borrowing rates at a 20-year high, the cost of construction extremely high in its own right, and suitable development sites becoming harder and harder to find, very few seniors housing builders are breaking ground right now. In the private-pay seniors housing segment, year-over-year inventory growth nationally was 1.3 percent in the third quarter of this year, according to NIC MAP Vision. That figure is near the smallest year-over-year …

November 27, 2023

Finance From The Magazine

HUD Lenders Take Business Decline in Stride

by Jeff Shaw November 27, 2023

Deal volume in the Section 232 program fell 3 percent to nearly $2.87 billion in FY 2023, but signs of a rebound emerge. By Matt Valley Considering the body blows the seniors housing industry absorbed coming out of the COVID-19 pandemic — including a spike in interest rates, inflation and labor issues that negatively impacted net operating income — deal volume in HUD’s Section 232 healthcare mortgage insurance program for fiscal year (FY) 2023 was solid, say lenders. Annual lending volume decreased 3 percent to nearly $2.87 billion, while the …

November 27, 2023

Development From The Magazine

Developers Devise Solutions for the Missing Middle

by Jeff Shaw October 4, 2023

By Bendix Anderson The problem can seem too big to solve. Many seniors can’t afford private-pay seniors housing, such as independent living, assisted living or memory care. But millions of those potential residents also have too many financial resources to move into housing reserved for low-income seniors. By 2029, there will be 14.4 million of these “missing middle” seniors. A few developers have new ideas about where these seniors might live. The prototypes of their new middle-market seniors communities are now under construction. From licensed assisted living in Florida to …

October 4, 2023

From The Magazine Operations

Welcome Back, NOI

by Jeff Shaw October 4, 2023

While rising occupancies and improving cash flows buoy owners and operators, questions remain whether net operating income will ever completely recover. By Jane Adler After several years of punishing declines, net operating income (NOI) — defined as operating income minus expenses — is slowly climbing back. As a vital metric used to assess the profitability and value of a property, any improvement in NOI is a good sign for the health of the sector. Seniors housing occupancy has been on the upswing for eight consecutive quarters, boosting revenues. The occupancy …

October 4, 2023

From The Magazine Investment

REITs Keep a Sunny Disposition

by Jeff Shaw October 4, 2023

By Jeff Shaw By many metrics, it has been a slow couple of years for REITs immersed in the seniors housing segment. The volume of acquisitions and dispositions by REITs in 2022 was the lowest in at least a decade, according to MSCI Real Assets. The expectation is that 2023 is going to be another down year for transaction volume. Publicly traded investors made approximately $2.5 million in acquisitions and dispositions in 2022, dropping from $12.7 billion in 2021. As recently as 2015 that number was over $15 billion. But …

October 4, 2023

Finance From The Magazine

Capital Corner: Lenders Ride Out the Storm, See Brighter Days Ahead

by Jeff Shaw October 4, 2023

By Matt Valley Heading into 2023, Lument’s Aaron Becker anticipated a challenging year for lenders and borrowers due to the sharp rise in interest rates, but he underestimated the level of difficulty. Capital providers tightened underwriting standards more than expected, which negatively impacted deal volume. U.S. property and portfolio sales in the seniors housing sector, excluding skilled nursing, totaled $3.27 billion during the first half of 2023 compared with $4.57 billion during the same period in 2022, according to MSCI Real Assets. That’s a 28 percent decline in deal volume …

October 4, 2023

From The Magazine

The Silver Tsunami Finally Arrives

by Jeff Shaw August 10, 2023

With baby boomers now aging into seniors housing in staggering numbers, how does the industry best serve this new generation of prospective residents? By Jeff Shaw For decades now, developers have been building up for a massive demographic wave of baby boomers aging into seniors housing. We’ve all heard the numbers: 10,000 Americans will turn 80 every day starting in 2025. By 2030, all 73 million boomers will be of retirement age. The wave was nicknamed the silver tsunami. With the first baby boomers turning 78 next year, the generation …

August 10, 2023

Development From The Magazine Skilled Nursing

A Complicated Alliance Emerges

by Jeff Shaw August 10, 2023

While some owners see opportunities in converting obsolete seniors housing into behavioral health facilities, others look for ways to improve those services within their communities. By Jeff Shaw Seniors housing and behavioral health real estate have a lot in common. Both house people with a largely needs-based offering. There are a wide range of products to serve a variety of needs, and residents are sometimes not there by choice. Both sectors also have favorable demographics and strong real estate fundamentals on their side with demand outpacing supply. Behavioral health real …

August 10, 2023

Assisted Living Finance From The Magazine

Investors Expect Assisted Living to Get Biggest Bump in Rental Rates Over Next Year, Says CBRE Survey

by Jeff Shaw August 10, 2023

By Matt Valley More than 75 percent of investors surveyed by CBRE expect rental rate increases of at least 3 percent over the next 12 months across all seniors housing asset classes except skilled nursing. The most bullish outlook is in the assisted living sector where 28.1 percent of survey respondents expect to underwrite rent growth above 7 percent, up from 15 percent in the 2022 survey. No decreases in rental rates are expected for any asset class. Meanwhile, difficulty in maintaining adequate staffing levels ranks as the greatest headwind …

August 10, 2023

Development From The Magazine Operations

The Art of Turning Around Troubled Properties

by Jeff Shaw June 28, 2023

Owners and operators test new strategies and scrutinize all expenses as the number of financially beleaguered assets multiplies. By Jane Adler Despite encouraging signs of a seniors housing turnaround, the challenging operating environment is creating an uptick of troubled properties in need of their own turnaround. The triple whammy of the pandemic, rising interest rates and higher expenses has hit the sector hard. Margins are squeezed and valuations are depressed. What’s more, the recent banking crisis and the growing prospects for a recession have added to financial pressures. “There’s a …

June 28, 2023

Newer Posts

Older Posts