Seniors Housing Recovery Gains Traction, NIC Data Reveals
NREI Reports: Seniors housing operators and investors will find some encouraging signs in the latest report on the state of the industry as the annual absorption rate of units hit its highest level since the beginning of 2007.
The annual pace of absorption was 2.1% in the first quarter of 2011, up from 1.7% in the previous quarter, and up from 1.3% a year before. Rent also ticked up 0.5% in the first quarter after being flat in the previous quarter, according to the National Investment Center for the Seniors Housing & Care Industry (NIC) based in Annapolis, Md.
“We have further evidence this quarter that the recovery in seniors housing is gaining traction,” says Michael Hargrave, vice president at NIC MAP, which tracks properties in the nation’s top 31 metropolitan statistical areas to compile survey results. “Rent growth and absorption are trending up, and those are positive signs for occupancy, and for the industry’s health.”
The report shows that occupancies have continued to rise over the last four quarters at seniors housing properties, which include assisted living and independent living facilities.
The average occupancy rate for seniors housing in the first quarter of 2011 was 87.9%, which is 0.2% higher than the previous quarter, and 0.6% higher than the 87.3% occupancy level of a year ago.
The fundamentals started to improve at assisted living properties about a year ago, and at independent living properties about six months ago. But, in the first quarter, independent living properties experienced the biggest gains.
Occupancies at independent living buildings rose to 87.7% in the first quarter from 87.3% in the previous quarter. Assisted living occupancy during the same period remained unchanged at 88.4%