The Evolution of Seniors Housing
Over the past 20 years, the seniors housing industry went through incredible change and improvement. Seniors housing investments don’t look like what they used to, and the industry has matured like never before.
The Industry Withstands Shakeups
The seniors housing industry has stood firm against challenges. For example, in 1997 the skilled nursing sector underwent bankruptcies due to PPS, the perspective pay system. Many skilled nursing operators had to shut down their operations because they had issues with cash flow due to the system.
The seniors housing industry suffered a huge hit in the Great Recession with various external economic issues. Operators struggled to acquire debt for acquisitions and refinancing.
Luckily the seniors housing industry came out on top. In 2010, it was one of the only product types that was able to raise rental rates. This is because many of the services in the industry are need-driven.
70% of the Seniors Housing Industry is Fragmented
In 2015, REITS owned 30% of seniors housing real estate. The other 70% is available for small regional, or mom-and-pop operators to own facilities. Investment specialists predict that it is the operators within this 70% that will keep the industry alive and well.
The National Investment Center tracks all activity within the seniors housing industry. Currently, all elements are in place for the industry to become an institutional-grade asset class. This makes the perfect opportunity for serious investors.
The Seniors Housing Industry Continues to Evolve
The seniors housing business is a need-driven industry, meaning that no matter what a family’s funds are, specialized care from assisted living, memory care, or skilled nursing facilities are necessary. This inherently acts as a pillar for the industry regardless of the climate of the economy.
The demand pipeline for seniors housing continues to grow. Those with capital in other product types are moving into the industry.
While the industry is strong, some regional markets are overcrowded with new product. There are about six to seven markets in the U.S. that may have potentially begun too much construction with not enough demand. Investment specialists must wait to see how long it might take demand to catch up with the over-supply. Nonetheless, new buildings are always good for the industry as they add value and competition for better services throughout the country.
Your Housing Investment with The Stahler Group
The Stahler Group is the top brokerage for your seniors housing investment. With over 40 years of combined experience, our team is unmatched in acuity and experience with the track record to prove it.
Make the most out of your investment – call the experts in the seniors housing industry, The Stahler Group.