nic report on seniors housing market fundamentals
TRANSCRIPT
A Lincoln Healthcare Group Event
NIC Report on Seniors Housing Market Fundamentals
Chris McGraw, Senior Research AnalystNational Investment Center for Seniors Housing & Care
A Lincoln Healthcare Group Event
5 Things to Know1. Fundamentals are coming off a good year.2. Supply risks generally isolated to assisted living.3. Assisted living’s supply risks are not widespread.4. Fundamentals should have another good year in 2015.5. Independent living may enjoy 2015 more.
A Lincoln Healthcare Group Event
Hyper SupplyFalling OccupancyFalling RentsRapid Construction
RecoveryRising OccupancyRising RentsNo Construction
RecessionFalling OccupancyFalling RentsNo Construction
Boom
Trough
Independent Living
Assisted Living
Where is Seniors Housing in its Cycle?
A Lincoln Healthcare Group Event
Now and Then
Now Pre-Recession YOY
Occupancy 91.3 92.5 ↑
Construction 2.4 5.7 ↑
Rents* 0.6 1.8 ↑
Now Pre-Recession YOY
Occupancy 89.3 90.2 ↑
Construction 5.2 3.8 ↓
Rents* 0.5 1.5 ↔
Independent Living
Assisted Living
*asking annual rent growth – core inflation
Source: NIC MAP® Data Service
A Lincoln Healthcare Group Event
Favorable Supply to Continue for Independent Living
Source: NIC MAP® Data Service
Forecast
A Lincoln Healthcare Group Event
Balanced Supply-Demand for Assisted Living
Source: NIC MAP® Data Service
Forecast
A Lincoln Healthcare Group Event
Big Supply Headline, but Somewhat Isolated
Source: NIC MAP® Data Service
Assisted Living Construction
A Lincoln Healthcare Group Event
Occupancy Spread Between Markets May Widen
Source: NIC MAP® Data Service
Assisted Living Occupancy
A Lincoln Healthcare Group Event
Independent Living Construction Rising, but Still Low
Source: NIC MAP® Data Service
A Lincoln Healthcare Group Event
…and Even More Concentrated
Source: NIC MAP® Data Service
Independent Living Construction
A Lincoln Healthcare Group Event
Supply Risks Isolated to the Southwest
Source: NIC MAP® Data Service
Independent Living Occupancy
A Lincoln Healthcare Group Event
New Supply Could Impact Existing Properties
Source: NIC MAP® Data Service
A Lincoln Healthcare Group Event
Closing Remarks• Fundamentals likely to remain in recovery through 2015.• Supply will likely hold back assisted living occupancy from rising.• There will be differences in performance between markets.• Occupancy to pre-recession levels by the end of this year.• What will be the duration once we’ve reached a peak?
A Lincoln Healthcare Group Event
Questions?Chris McGrawSenior Research AnalystNational Investment Center for Seniors Housing & [email protected]