Data from the recently released 1Q 2025 NIC MAP Actual Rates Report show that: 

• Independent living properties continued to report strong year-over-year rate growth across all rate categories in the first quarter of 2025. Between December 2024 and March 2025, in-place rates rose 0.7 percentage points (pps), pushing annual growth to a record-high 10.8%. Initial rates increased 1.6pps during the same period, with a year-over-year growth rate of 14.3% in March 2025, the second highest on record.
• In contrast, assisted living properties experienced a deceleration in the pace of rate growth across all rate types. Year-over-year growth in March 2025 fell to 1.2% for initial rates, 3.2% for asking rates, and 4.0% for in-place rates, the slowest pace recorded since 2021.

In 1Q2025, discounts between asking and initial rates remained largely unchanged from the previous quarter for both independent living and assisted living properties.

• For independent living properties, initial rates in March 2025 were 6.1% (or $271) below asking rates, equivalent to a 0.7-month discount on an annualized basis, unchanged from December 2024.
• For assisted living properties, discounting widened slightly. As of March 2025, initial rates averaged 9.1% (or $611) below asking rates, translating to a 1.1-month discount on an annual basis.

Additional key takeaways are available to NIC MAP subscribers in the  full report.   

About the Report: The NIC MAP Seniors Housing Actual Rates Report provides aggregate national data from approximately 300,000 units within more than 2,500 properties across the U.S. operated by over 50 senior housing providers. The operators included in the current sample tend to be larger, professionally managed, and investment-grade operators as a requirement for participation is restricted to operators who manage 5 or more properties. Visit the NIC MAP website for more information.

The senior housing and care sector is ripe for growth, driven largely by the significant aging demographic hitting the U.S. daily. This growth will require committed capital partners, not only in the form of ongoing support from existing sources of capital, but with new and emerging financial partners. For the past year, NIC has focused time on educating and engaging with Family Offices who, on average, invest roughly 15-20% of their assets in real estate holdings.

A formal “Family Office” is an entity that provides services to manage the wealth and interests of ultra-high-net-worth individuals and families, typically across multiple generations. It is estimated that there are nearly 3,200 Family Offices in North America, a figure which is projected to grow to nearly 4,200 by 2030, accounting for about 40% of the Family Offices globally.¹ At the same time, wealth held by these North American institutions is forecasted to hit $4 trillion by 2030.¹

While these entities have great wealth to deploy across various investments, it is important to understand the nuances of Family Offices. Awareness of these unique characteristics will best position senior housing organizations for a potential investment and long-term relationship. 

1. An estimated 68% of Family Offices in this country have been established since the year 2000.² This means that they are still evolving and working toward greater institutionalization. Family Offices learn from one another and may often work in collaboration, whether in forming multi-family offices or perhaps simply partnering for investment opportunities.
2. The space is fragmented and can be difficult to navigate. This may mean making connections with these individuals and entities can be a challenge.
3. As one Family Office expert noted at a recent conference, “Just because you have a lot of money doesn’t mean you know how to invest.” These high-net worth individuals and their families often look to trusted investment advisors to invest and manage their funds. This means that relationships often need to be made with the advisors as well as family members.
4. Trust is paramount. These individuals and entities can be guarded for obvious reasons, and many have been burned in the past with ill-informed investments. It is important to spend time developing the relationship and fostering that trust, understanding that Family Offices are not necessarily going to invest right after meeting you. This means that this type of capital requires a long-term commitment.
5. Wealth preservation is a high priority for Family Offices. This means more patient capital, which can be a good thing for the senior housing sector.
6. Education will be needed. Compared to other commercial real estate property types, senior housing is more operationally complex. It is your responsibility to fully educate potential partners on the nuances of this space and potential risks. Senior housing continues to be seen as an alternative asset class and most Family Offices, even those with real estate investment experience, will not be familiar with the sector. Spend the time needed to ensure alignment and an educated investor, which will better position the relationship for long-term success.
7. It is important to note that the opportunity for Family Office investment goes beyond real estate. Many of these individuals have built fortunes on operational-intensive companies not solely based on real estate. This offers a potential emerging type of capital investment in our sector.

NIC is continuing to commit resources to capital formation activities and is developing additional resources to help others in the sector educate potential future investors. Stay tuned in the coming months for releases of many of these additional resources. If you have questions about this target audience, you can reach out to me at lmccracken@nic.org.

Sources:

¹Defining the Family Office, 2024. Deloitte
²Diamond Wealth

How Does Active Adult Differ from Traditional Senior Housing?

NIC MAP tracks age-eligible, market-rate, multifamily rental properties focused on enhanced lifestyle programming without providing meals. These communities are designed for older adults who are ready to downsize to a maintenance-free lifestyle, but who do not yet need the services and care provided in traditional independent living communities.

As of the first quarter of 2025, NIC MAP tracked nearly 800 active adult rental properties totaling approximately 118,000 units, a much smaller market size than the approximately two million senior housing units that NIC MAP tracks. With a median unit count of 138, active adult rental communities are comparable to traditional independent living’s median of 144 units, although the size of the units is typically larger within active adult. With a median age of less than 10 years old, active adult communities are generally newer than traditional independent living communities, which have a median age of 21 years¹.

Stabilized Properties Are Nearly 96% Occupied on Average

NIC MAP in the first quarter of 2025 began reporting a time series of quarterly occupancy rate trends. At 95.6% in the most recent quarter, stabilized average occupancy rates have been above 95% for three consecutive quarters. The average all properties occupancy rate – which includes properties open less than two years – has also been robust, ranging from 92% to 94% over the most recent four quarters.

What Rental Rates Are These Active Adult Communities Charging?

NIC MAP reports median average monthly rents (AMR) by metro area. Within the largest 31 Primary Markets tracked by NIC MAP, Miami ranks highest at a median of nearly $3,500 per month, followed by Portland, Chicago, Washington, DC, and New York as the remainder of metro areas with median AMRs above $3,000. The next five highest median AMRs are clustered around $2,500 in Boston, Seattle, Philadelphia, San Antonio, and Denver.

Deepen your knowledge of the Active Adult sector by attending NIC Academy’s first-ever Active Adult Boot Camp on Wednesday, September 10, 2025, in Austin, TX. This full-day session, held in conjunction with the 2025 NIC Fall Conference, provides a comprehensive introduction to Active Adult, offering both foundational knowledge and hands-on learning. Register today!

What is Driving Demand for Active Adult Rental Communities?

The fastest-growing group of renters in the U.S. are those aged 65–74², reflecting broader demographic shifts as the baby boomer generation ages. There is also a notable rise in “gray divorce” (divorces among those aged 50 and older) and solo aging, both drivers of demand for active adult rental communities. Additionally, the boomer generation in recent years has become the wealthiest in terms of median net worth, further fueling demand for high-quality properties with resort-like amenities.

Most Popular Amenities Focus on Lifestyle and Wellness

The most popular amenities in active adult rental communities include fitness centers, pools, clubhouses, and activities coordinators, illustrating residents’ strong interest in lifestyle, engagement, and wellness. NIC MAP’s Primary and Secondary Markets share nine of the top 10 amenities, with personal storage ranking within the top 10 amenities in the largest 31 Primary Markets tracked by NIC MAP, while salons and spas rank within the top 10 amenities in the 68 Secondary Markets.

Room for Growth

Looking ahead, the active adult rental market is still in its early stages. Penetration rates are well below those of traditional senior housing, indicating potential opportunity for further development depending upon the market and submarket. Investors and developers should conduct in-depth research and ensure thorough due diligence when entering a new market, striving to keep lifestyle and engagement at the core of lease-up and operations.

^[1] ASHA The State of Seniors Housing, 2024

^[2] Census Bureau

Over the last 40 years the senior housing industry has continued to evolve. From new and improved wellness programming to major advancements in health tech, the industry continues to modernize itself in the interest of a healthier and happier resident.

While we celebrate advancement in the health, happiness, and longevity among our aging population, certain subsets of senior housing communities remain in a vulnerable position. As the landscape of senior housing evolves, some older communities struggle to keep up. Some of these properties, often built decades ago, no longer meet the expectations or needs of today’s consumer. Inefficient layouts and lack of modern amenities leave them ill-equipped to compete with newer, more thoughtfully designed communities. However, rather than allowing these properties to struggle financially, there is a growing opportunity to convert them into alternative uses that serve different populations.

Most conversion candidates tend to be built before the millennium and have certain attributes that make keeping up with evolving consumer preference a challenge. That’s not to say that age or functional obsolescence is the only factor contributing to alternative uses. Some communities may have been developed in the last 10 to 15 years but missed on their underwriting assumptions and simply can’t command the rental rates needed to stand on sturdy financial ground. Others may have underwritten the rate equation correctly but missed on market demand, leaving the community poorly occupied beyond an extended period. Whatever the reason for a pivot, there are several alternative use cases investors are having tremendous success executing.

One of the more common instances of this pivot is converting senior housing communities into behavioral health or substance abuse treatment centers. The demand for mental health services has grown dramatically, yet the supply of appropriate residential treatment centers has not kept pace. Senior housing communities include features such as private or semi-private rooms, dining areas, recreation spaces, and medical infrastructure—attributes that align well with the needs of behavioral health environments. While the physical plant characteristics of senior housing communities mostly mimic the needs of behavioral health facilities, the specific zoning of the existing senior housing community typically dictates the viability of conversion.

Another growing trend in our industry is conversion to more affordable, market-rate 55+ living. Like behavioral health conversions, zoning can be an impediment, however, the change in use is marginal and generally welcomed by local municipalities and their constituents. These communities present a practical and timely solution as they have the foundational infrastructure needed for active adult housing during a time of rising costs for senior housing residents. Independent living communities work best for this adaptive reuse; however, with targeted renovations and cost-effective upgrades, assisted living communities and even skilled nursing facilities can be repositioned to serve middle-income and fixed-income older adults who are priced out of other communities. By preserving the communal and supportive elements while eliminating costly services that aren’t necessary for independent seniors, owners can offer a quality, age-restricted living option at a more accessible price point. These conversions not only extend the useful life of aging properties but also help meet the growing need for affordable, age-friendly housing solutions.

Ultimately, converting senior housing to other uses should not be looked at as a fallback, but rather an opportunity. By embracing adaptive reuse, you can breathe new life into outdated properties and support other areas of need. In doing so, you ensure these spaces continue to serve other unique populations in meaningful ways.

Senior living residents and their families would like to have easy access to healthcare services. But owners and operators can find it challenging to make those services easily available.  

Medicare Advantage (MA) plans from private insurers align with the government’s move toward value-based care by replacing traditional fee-for-service payments with reimbursements based on quality outcomes. Senior living communities can improve resident care by partnering with a provider in a value-based care model. 

A panel of experts recently explored a case study of how MA health plans can be an ally of long-term care providers.  

The Q&A discussion, presented during the 2025 NIC Spring Conference, was moderated by Dr. Katy Lanz, Healthcare Advisor and Strategist at TopSight Partners, and a member of NIC’s Partnering for Health Focus Area Committee. She was joined by René Lerer, CEO at Longevity Health Plan, and Catherine Field, Senior Vice President & Medicare Division Leader West Division at Humana. 

What follows is a recap of the discussion, edited for length and clarity: 

Dr. Katy Lanz: The Centers for Medicare & Medicaid Services (CMS) has set a goal to have 100% of Medicare beneficiaries, and most Medicaid recipients, in a value-based care model by 2030. Senior living providers play a vital role in supporting the health and well-being of their residents and can actively engage in value-based care arrangements.  

The key is to focus on partnerships with Medicare Advantage (MA) plans and other CMS demonstration platforms, such as the ACO REACH program.  Assisted living and nursing communities are highly focused on Medicare Advantage Institutional Special Needs Plans (I-SNPs), which are growing quickly. I-SNPs are a type of MA plan designed to serve individuals who live in institutional settings or who need an institutional level of care. 

The alliance between Humana and Longevity represents a good example of a successful I-SNP partnership to provide healthcare to the residents of nursing care facilities.  

Catherine Field: Humana is the second largest MA carrier insuring 6.5 million lives and 1.5 million Medicaid lives. When senior living providers partner with a value-based care platform, we see better quality outcomes.   

René Lerer: I was a practicing doctor. Longevity is a clinical company with 700 employees. Our goal is to take care of people and their wellbeing. We are the largest independent I-SNP with 10,000 members.  We have developed a partnership with Humana. We started with skilled nursing facilities and are having conversations with assisted living and memory care communities. Our population is institutional. We bring clinical staff into the buildings to manage resident care. We have a true partnership with senior living communities to augment what they do.  

Lanz: What is Humana’s approach? 

Field: Humana is contracted with 16% of the skilled nursing facilities in the country. We’re seeing a transition to value-based care. Transactional relationships with the insurer are being replaced with end-to-end consumer care. Our job is to help people transition through the healthcare system. Every transition, say from hospital to home, is a time when care can get dropped. Our focus is on quality outcomes and getting people back where they live.  

Lanz: How do changes in Medicare rules affect your decisions? 

Lerer: Medicare is changing rapidly, growing quickly and impacting everyone. Over the last six years we’ve learned a lot about value-based care. The building staff have a big impact on resident outcomes. We need to educate the staff on value-based care. It’s a major change. We understand how the community works and how managed care works for the benefit of the residents. 

Lanz: What lessons have you learned? 

Lerer: We’ve found that scale matters. We formed a partnership with Humana which has a skill set focused on contracts and compliance. CMS has so many rules. The partnership has allowed us to focus on the clinical side and take care of our population. 

Lanz: Why did Humana partner with Longevity? 

Field: We spend much of our time serving the senior population, so it’s hard not to help people living in senior living facilities. We started talking to healthcare providers in 2018. But we didn’t understand the business complexities of nursing homes. We needed a knowledgeable partner and found Longevity. They needed our scale, and we needed them because they could speak the language of skilled nursing operators.  

Lerer: The skilled nursing world is unique. The average facility has 100 beds. We are in 500 buildings with 30-40 patients in each building. A partnership with the facility is the only way to achieve scale and succeed. 

Field: MA penetration in the I-SNP space is only about 13%. There are a lot of opportunities to bring more value to a forgotten population.  

Lanz: What’s the operator’s path to entry into value-based care?  

Lanz: What’s the next step from a value-based care perspective? 

Field: Develop a strategy. What are your values? What’s important? Test and learn is the name of the game in healthcare. Give it a try. You don’t have to do it alone or learn on your own. You can share the risk. Work with a partner that has the technology and data infrastructure. Find partners. 

Lanz: What MA benefits are most helpful? 

Field: For this population, we think about transportation or over-the-counter items such as adult diapers. Our partnership with Longevity has helped us build our plans so members can access benefits. 

Lerer: The benefit people enjoy the most is music therapy. It wakes them up. They have an amazing response. We also have a hairdresser benefit. It’s not expensive and can make a big difference in the residents’ mental health. We have the ability to be flexible to meet the needs of this vulnerable and unique population.