Insider Newsletter

May 2020

A Note From Brian Jurutka

As COVID-19 continues to spread, all of us at NIC wish to applaud the efforts of the thousands of operators and frontline care workers who are fighting 24/7 to keep seniors housing and skilled nursing residents safe. These communities are an essential part of the healthcare continuum; they are battling both to keep this vulnerable population healthy, and to keep our hospitals from becoming quickly overwhelmed. Yet, access to PPE, tests, and support for workers’ families has not been sufficient. We continue to stand with the industry to advocate for the support that it needs.

The COVID-19 healthcare crisis has now also become an economic one as uncertainty on the timeline of the pandemic, rapid changes in federal, state, and local policies, and potential changes in social norms take their toll. Lack of consistent and accurate data on the spread of COVID-19, mortality and recovery rates, hot-spots and vectors, not only hamper the fight against a pandemic, but impact consumer and investor confidence.

NIC is working hard to improve data availability and transparency across the skilled nursing and seniors housing sector. Our focus on gathering usable data on the impacts of the virus will help inform capital and operators on trends, opportunities, and risks. To support decision-makers as they navigate this crisis, NIC is doing what we do best by providing timely COVID-relevant data, analytics, and connections. And, to keep pace with events, we’re doing so on a highly accelerated schedule.

In response, we’ve seen record engagement. Thousands of you have been engaging with our COVID-19-related new content, which you can read about in this issue.

With the launch of our “COVID-19 Resource Center”, and also the “NIC Weekly Recap” e-newsletter, we have made it extremely easy to stay up-to-date on all the information, events, and opportunities to participate that we now offer. I encourage you to visit frequently and subscribe.

Via our “NIC Notes” and “Housing & Healthcare” blogs, as well as the “NIC Insider,” we also offer our own original content, including interviews, analysis, news, and perspectives. Complementary subscriptions ensure you won’t miss a thing.

There will be more to come, as the entire NIC staff, working remotely, continues to inform the seniors housing and care sector, including the operators, capital providers, service providers, and healthcare partners it depends on to be successful in its mission, and to help us achieve ours, which, as you know, is to enable access and choice for America’s elders.

We wish you well during these challenging times.





Brian Jurutka

President & CEO

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NIC Launches New Data, Analytics, and Connections to Combat COVID-19

As the seniors housing and skilled nursing sector’s leading provider of data, analytics, and connections, NIC has reacted quickly to the COVID-19 pandemic, launching numerous initiatives designed both to speed delivery and dissemination of quality data on the impact of the crisis, and to facilitate discussion and problem-solving across the industry. Already, these initiatives are helping operators, capital providers, service providers, policy makers, and the media access the information they need to inform good decision-making as they struggle to navigate through this extraordinarily difficult time.

All COVID-19-related initiatives are available to the public, at no cost, and can easily be found on our newly launched COVID-19 Resource Center. On this page, visitors can access a wealth of information, including the latest data, industry resources, articles, blog posts, and registration and participation links. As every initiative is ongoing, visitors are encouraged to bookmark and revisit the page often. The page also offers users the option to subscribe to the new “NIC Weekly Recap: COVID-19 Newsletter” for an efficient weekly update.

New Data

Executive Survey Insights

Over many years, NIC has earned a position of trust with most of the nation’s operators of seniors housing and care properties, which affords us a unique opportunity to ask for – and receive – data and feedback that few, if any, other organizations have access to. One of the several initiatives launched over the past few weeks is our “Executive Survey,” which takes a weekly “pulse” of hundreds of operators, representing thousands of properties across the country. Respondents are among the senior executives tasked with protecting 2.5-3.0 million frail elders, through arguably the most threatening crisis in the sector’s history.

NIC has already published four “waves” of survey results along with expert analysis from NIC Senior Principal Lana Peck. Surveys are distributed weekly to assess occupancy rates, move-in and move-out rates, the development pipeline, staffing, and supports for frontline community employees and staff. The latest survey results and accompanying analytical insights will continue to be posted to the NIC Notes blog. Operators wishing to participate may do so via a link on the COVID-19 Resource Center page.

NIC MAP® Data Delivered Monthly

NIC’s data team is working hard to produce COVID-relevant NIC MAP® three-month rolling data on a monthly basis, beginning with the period ending April and delivered in May, to explain trends in the market. The team is also working to subsequently make such data available in the NIC MAP interface. This is a very heavy lift, in terms of staff time and problem-solving abilities, but NIC staff are dedicated to achieving this to-date unmatched rate of data collection, processing, and dissemination, in order to deliver timely and relevant data in the fight to combat COVID-19 impacts.

New Analytics

Leadership Huddle Webinar Series

Bi-weekly “Leadership Huddle” webinars feature panels of experts from across the sector, focusing on the impact of COVID-19. Thousands of capital providers, operators, service providers, and other sector stakeholders have attended these events already, with many more expected to bring their questions and comments to subsequent live webinars, and to revisit recently posted recordings on the COVID-19 Resource Center.

Each “huddle” offers the latest analytical and operational insights and timely perspectives from leaders across the sector.

The first, held on March 26, 2020, was titled, “COVID-19, Financial Market Uncertainty, and the Impact on Seniors Housing & Skilled Nursing.” The webinar kicked off with an up-to-the-minute presentation on the economic impact of COVID-19 from NIC Chief Economist Beth Mace, which included highlights from a recent Activated Insights survey of 1,100 properties. A presentation on the sector’s recent performance followed, from Jim Costello, senior vice president of Real Capital Analytics (RCA). The webinar then featured a frank and insightful discussion with Mace, Costello, and fellow panelists Matthew Ruark, senior vice president, head of commercial and healthcare mortgage production, KeyBank Real Estate Capital; and Kurt Read, principal at RSF Partners. A recording was posted shortly after the event and is available for review. A recap article, which distills the webinar’s key discussion points, has been published in the NIC Insider e-newsletter.

The second “huddle” began with the presentation of data from the newly launched NIC Executive Survey Insights, followed by an animated and heartfelt discussion amongst capital provider and operator leaders currently navigating their businesses on the frontlines of the COVID-19 pandemic. Titled, “The Intersection of Operators and the Financial Community in a COVID-19 Environment,” the April 9 event focused on how the industry is managing the crisis, both from the perspective of operators on the frontlines of the pandemic, and the capital providers who are grappling with shifting economic realities. Attendees gained insights from an Oregon-based operator, Fee Stubblefield of The Springs Living, whose properties have been fighting to protect their residents since late February, as well as capital providers who are working every day to provide support to their portfolios of operators, while planning for the future during a time of monumental change. A recap article can be found on the NIC Notes blog.

New Connections

Leadership braindate™

Premiered at the 2020 NIC Spring Conference, the NIC braindate platform has proven to be a convenient and efficient means to find, connect with, and have one-on-one or small group conversations (via video) with others interested in the latest developments, learnings, and issues dealing with this crisis. NIC is offering complimentary access to the innovative online platform as a means to facilitate discussion and information-sharing across the sector. Instructions and complimentary access can be found here.

New Original Content

The COVID-19 pandemic is developing at break-neck speed, producing new challenges, solutions, policy changes, news headlines, and insights, on a daily basis. To help NIC audiences stay abreast of the latest developments, and to deliver timely insights and resources as they become available, NIC has increased its output of fresh, original content. Blog subscribers will have noticed an increase in the number of posts, along with an expansion of topics and information available on these platforms.

NIC Notes subscribers receive a weekly update email on Mondays, and Housing & Healthcare subscribers receive immediate notification emails upon publication of new content. Both blogs are focusing on the fight against COVID-19. Each features perspectives, interviews, news, and insights that go beyond the data and delve into issues that face leaders across the seniors housing and care sector, and, in the case of Housing & Healthcare, offer insights into the ongoing developments in healthcare partnerships, innovations, and collaborations.

In addition to the NIC Insider e-newsletter, which is still published monthly, NIC has launched the “NIC Weekly Recap: COVID-19” e-newsletter, which provides subscribers with a single weekly email containing an update on all COVID-related activity and publications from NIC. The new publication is designed to keep pace with events while providing a “one-stop shop” for the efficient perusal of all the latest news, original and curated content, data, industry resources, events, and opportunities to participate. Subscribe to this complimentary and convenient resource on the COVID-19 Resource Center.

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Property Markets Before and After the Pandemic: A Conversation with Jim Costello of Real Capital Analytics

Uncertain times create data-hungry investors. Buyers and sellers are eager for timely data to inform their decision-making. How will property dynamics change in the aftermath of the pandemic? What opportunities could emerge?

Jim Costello has the data. He tracks the commercial real estate market in his role as senior vice president at Real Capital Analytics, a research firm in New York. He recently shared his latest insights with NIC Chief Economist Beth Mace. Here is a recap of their conversation.

Mace: Can you tell us about Real Capital Analytics (RCA) and your role?

Costello: Real Capital Analytics was founded in 2000 to create a database of pricing, capital flows, and investment trends for commercial real estate assets worldwide. I’m an economist and have been at RCA since 2015. My job is to analyze trends and data, and communicate that information to the market.

Mace: Your firm tracks pricing and transactions volumes for all commercial real estate. Prior to the COVID-19 pandemic, what were the general trends you were observing?

Costello: Before COVID-19 hit, commercial real estate was doing okay. In the first two months of the year we saw a decent level of deal activity across all property sectors. We had an interest rate environment that was quite friendly to commercial real estate, investors who were hungry for yield, and capital was still flowing into the sector. The seniors housing and nursing care sectors were participating in that capital flow. Not only did the sector have a healthy yield, but people understood the demographic story of the growing need for more facilities. The seniors housing and nursing care sector was doing well before COVID-19.

Mace: Up until recently, who were the largest buyers and sellers of seniors housing and skilled nursing properties?

Costello: The participation of buyers in seniors housing and nursing care has been going through an evolution. Before 2015, there wasn’t much institutional capital involved in the sector. Buyers were mostly private capital sources representing disparate ownership of one or a few facilities at a time. The big transition was professionalization of the investment management of the assets. REITs and private equity investors bought buildings to create portfolios. In the last few years, the REITs have not been as active. Their share prices took a hit when interest rates increased, and they couldn’t purchase as many properties. Private equity buyers have been consistent over the last four years, representing around 25% of the market every year. They’re still attracted to the sector because they understand its long-term benefit to their portfolio.

Mace: What have been the pricing trends for seniors housing? And how does this compare with other sectors such as multifamily?

Costello: Cap rates for seniors housing and nursing care had been falling over the last couple years along with those for all other commercial real estate property types. As interest rates tightened, cap rates came down. Compared to seniors housing, apartments have a much narrower spread between forward cash flow cap rates and the 10-year U.S. Treasury bond yield. The apartment sector has had cap rates of 4-5%. Cap rates for seniors housing and nursing care have been in the 6-7% range. The higher cap rates for seniors housing and care represents the higher risk associated with the sector’s operational intensity.

Mace: Has the risk premium for seniors housing and care narrowed in the last several years?

Costello: The average cap rate for seniors housing and nursing care was 6.2% in the first quarter of 2020, based on deal activity in January and February. The 10-year U.S. Treasury bond yield was around 1.5%. That still represents a sizable margin. The bond market trades in picoseconds, almost instantaneously. Property sales have a long process of price discovery. Someone must conduct site inspections, put together a sales package, and field bidders. Interest rates may drop, but it takes a while for property prices to change.

Mace: Who have been the largest sources of debt capital for seniors housing and skilled nursing?

Costello: The most active debt originators so far this year in the nursing segment have been financial firms (non-bank entities). Some of these include Greystone, Wakefield Capital Management, and Capital Funding Group. Nursing care offers a higher yield and a little less competition. Debt funds are also active in the broader seniors housing segment, but banks are more active there.

Mace: Now we are in the middle of the largest health crisis in our lifetimes and of what could be the single largest economic event since the Great Depression. How are markets responding? Have transactions screeched to a halt? Do you have any recent data available to share?

Costello: The market for commercial property transactions is shutting down but the reasons vary. Right now, everyone loves industrial properties because of a projected increase in demand for warehouse space as the pandemic gives e-commerce a further boost. Even so, industrial deal volume year-over-year fell by 27% in March. No one can get anything done. More people are working from home, and they can’t conduct on-site due diligence. There were deals in progress that have closed, so it’s not as bad as it could have been. Sectors like hotels and seniors housing and care are having more trouble. Deal volume in the hotel sector year-over-year fell 56% in March. Seniors housing and care deal volume had a nice strong start in January of $1.7 billion. February deals totaled $837 million. Deal volume in March was $488 million, down 42% from a year ago. These sectors are bearing the brunt of the uncertainty around the COVID-19 crisis. Investors are getting skittish and pulling back at a faster rate than they are with other sectors.

Mace: A number of seniors housing and skilled nursing sales have been announced lately. When would these have been finalized? What is deal lag time? Should we expect to see fewer closings going forward?

Costello: My sense is that those transactions were already in progress. These deals take 20-30 weeks to conclude. Deal volume will dry up even more, the longer the uncertainty lasts.

Mace: Is debt more available than equity financing now? What does your data show for the availability of debt?

Costello: To the extent that debt is available, bankers are busy with refinancing activity. New acquisitions are not happening because of the uncertainty about the course of the disease and the outlook for the broader economy. If someone is going to buy something, it’s only because they’re getting a deal. Buyers and sellers are moving further apart in their expectations. The bid/ask spread has grown.

Mace: Do you expect write-downs of asset values?

Costello: We do not forecast. But any forecast should be taken with a grain of salt because there are so many uncertainties. It matters how much income is lost and how much is temporary and how much is permanent. Nobody quite knows those figures at the moment. If you want to set up a forward view, develop some scenario planning. What if the virus comes back in December? What will that do to the economy and property prices? What happens if we have healthy growth? Look at a range of numbers, from best to worst case scenario and make sure you are comfortable with the results in each case.

Mace: Will there be opportunities to buy distressed assets?

Costello: There was a lot of capital interested in real estate before the crisis. Investors liked seniors housing and care because it had a slightly higher yield and they were willing to take on the management intensive aspects of the assets. But properties were pricey. Buyers were cautious and sitting on the sidelines. There are a lot of buyers with capital. Price adjustments will generate activity.

Mace: If prices fall and lower the cost basis of properties, could that help create more affordable seniors housing for the middle market?

Costello: It depends on the severity of the downturn. If it’s not too bad, rescue capital could come in and keep the original owner in the deal. But if the situation is really bad and the lender takes over the property, there could be a scenario where a property sold at a discount could result in a more affordable product.

Mace: Are you able to do your job? Have your data sources dried up?

Costello: We continue to collect data from all our sources. These include public records and an extensive web-scraping operation for transaction announcements. We also deal directly with principals, buyers, brokers, and lenders. They all share information with us.

Mace: Looking ahead, how will the world change? What will be the near- and long-term implications of the pandemic?

Costello: In the short term, I anticipate a return of workers to the office at some point. But it won’t be the same. People will be wearing masks. Some people will still work from home. We won’t be going to conferences as much for the next year or so. But longer term there are benefits to density and having people get together. The city vs. the suburbs will be a big topic coming out of the crisis. We may see some short-term wins for the suburbs as millennials move to the suburbs to have space for the kids. That could help seniors who want to sell their homes and move into seniors housing. But there’s something that makes city life still attractive.

Mace: Seniors housing ranked high as an investment opportunity prior to the pandemic. How will seniors housing fare?

Costello: The sector has some negatives in near term. Reports about residents getting sick in nursing homes raise questions about risk. Potential investors must be educated about the differences between seniors housing and skilled nursing. Operators must get ahead of the curve and identify all the things they’re doing to keep residents safe and how lessons learned from this crisis will be applied moving forward. Once operators can show that, investors and consumers will be more accepting of the sector.

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Thoughts from NIC’s Chief Economist

By Beth Burnham Mace

And the beat goes on as the new normal of living in a world of COVID-19 becomes our reality. However, the beat is not like any rhythm we have ever known. The pandemic has changed the pace of virtually every aspect of our lives and, for those of us involved in caring for America’s elders who reside in seniors housing and skilled nursing properties, the challenge has been formidable, although not insurmountable. Despite impaired supply chains and a lack of federal coordination, operators are increasingly acquiring the personal protective equipment (PPE) that is needed to keep their staff and residents better protected from this invasive virus. While heroic stories of frontline care workers seldom make frontpage headlines, stories of carefully implemented safety protocols that limit the spread of the virus within properties abound. Images of well-planned opportunities for staff and residents to interact, socialize, exercise, and be engaged are common, yet little publicized. When we look back on this time, we will be proud of what the industry has collectively achieved in protecting our seniors in this difficult period. But we will also look back and be frustrated that circumstances were such that many people in the public at large as well as in congregate settings did become ill and, in some cases, did die from this perilous virus. To prevent further spread of the COVID-19 virus, we continue to seek PPE. And of critical importance, the industry seeks reliable testing protocols, for the general public, and for the staff working in and the vulnerable residents living in congregate settings.

Against this background is the economy and the anguish it is unleashing on millions of workers. In just six weeks, 30 million Americans filed initial claims to collect unemployment insurance in the period ending April 25, 2020. That is more than all the jobs created in the national economy since its recovery from the 2008/09 recession. Moreover, the figure does not consider the millions of workers who have not yet or will not file claims. We can expect more of these record-setting events ahead. Indeed, the Commerce Department recently reported the steepest monthly drop in retail sales on record going back 30 years while the Federal Reserve said industrial production fell the most since 1946.

The outlook is difficult to project because we still do not know when the pandemic will retreat and if it will return in the future. Its only once we discover a vaccine and people become immunized that we will really be able to put the pandemic behind us. Until then, we will gradually try to re-open parts of the economy, but the opening will be sputtered, and large groups of businesses may never re-open.

The federal government and the Federal Reserve have worked hard to mitigate the damage. Congress and the Administration have now allocated approximately $3 trillion on programs (equivalent to roughly 14% of U.S. GDP) within the CARES Act, the Small Business Administration Paycheck Protection Program (PPP), and other programs. Meanwhile, the Fed has worked hard to keep the economy functioning and the credit markets liquid. It pushed the federal funds rate down by 150 basis points in mid-March to effectively zero, lowered the cost of discount window lending, introduced multiple facilities to support the flow of credit, and launched the Main Street Lending Program to purchase new or expanded loans to small and mid-sized businesses including seniors housing. Fannie Mae and Freddie Mac have also announced assistance to borrowers, including seniors housing operators, by providing mortgage forbearance for 12 months and waiving related late fees.

Only in time will we know the success of these programs, but what we do know at this time is that much of the economy remains open, the credit system is still functioning, and relief is being provided to millions of jobless workers. Nevertheless, real GDP is still projected to drop by up to 40% at an annualized rate in the second quarter of this year and the jobless rate is expected to reach more than 15% by May.

The great uncertainty wrought by the pandemic and the economy has virtually shut down commercial real estate transactions markets, with few deals getting done. Price discovery between buyers and sellers is opaque, at best, and capital is sitting on the sidelines waiting to see how these circumstances unfold.

All eyes are on operations. Move-ins have largely stopped as operators strive to prevent contagion in their properties from the virus. And occupancy rates are starting to decline as the weekly NIC Executive Survey results show. In the week ending April 19, 2020, approximately one-half to two-thirds of organizations reporting on their independent living, assisted living, and memory care units saw a decrease in occupancy from the prior month, while organizations with nursing care beds reported the largest declines in occupancy. The “survey” results also show that move-in rates have slowed as well, with two-thirds to three-quarters of organizations reporting on their independent living, assisted living, and memory care segments reporting a deceleration in move-ins.

Where it will end is hard to say, with the virus once again largely dictating the extent of business impact and disruption. Meanwhile, operators remain fully diligent in their efforts to prevent further contagion, with strict protocols to prevent and limit the spread of the illness across properties. Extra cleaning and contact prevention protocols, limitations on visits, restrictions on group activities, travel restrictions and other rules have been implemented. And for staff, safety protocols, flexible schedules, and accommodations to the new reality of social distancing rules with school closures are all in place.

So, how do you operate in this environment? Contingency planning, scenario analysis, best case-worst case plans all need to be implemented to address the myriad paths that may unfold. From an investor’s point of view, property valuations may be pressured lower, but how much lower? What is the impact on investment returns? From a borrower’s point of view, banks will be looking for lower loan-to-values, stricter covenant agreements, and higher interest reserve requirements, but how much higher? From a broker’s point of view, fewer deals will be coming across desks at least for now, until distressed properties that require capital infusions and recapitalizations emerge, but when? From an operator’s point of view, occupancy rates will be pushed lower, but by how much? If you are among the half of all properties that had an occupancy rate of 90% or greater as of the first quarter of 2020 by NIC MAP® metrics, the challenge may be large but not impossible. If you are among the 22% of properties with occupancy rates below 80% and in a market with generally low stabilized occupancy rates, the challenges may be greater.

In this time of unprecedented uncertainty and to be best prepared, one step forward would be for all businesses—capital providers and capital seekers–to create a worst-case scenario and then ease up on the assumptions to identify the impact on the bottom line. Once there, better informed decisions can be thoughtfully considered.

In the meanwhile, on behalf of NIC, we continue to laud the industry’s frontline workers and those behind the scenes in management and decision-making roles. Cooperation has never been stronger between capital providers and operators, demonstrating that together, we can fight and overcome this pandemic.

As always, I welcome your comments and feedback.

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Executive Survey Insights

By Lana Peck

NIC’s weekly Executive Survey of operators in seniors housing and skilled nursing is designed to deliver transparency into property market fundamentals in seniors housing and care at a time when trends are rapidly changing—providing both capital providers and capital seekers with data as to how COVID-19 is impacting the sector. With conditions changing rapidly, there is significant speculation and hearsay, and capital has taken a step back to reassess the market. Capital, however, will be required to get through this crisis.

This narrative highlights the findings from responses collected after the start of the pandemic until now as operators experience changing market conditions due to the COVID-19 threat to residents, staff, and business operations. Detailed reports for each of the three “waves” of the survey can be found on the NIC COVID-19 Resource Center webpage under Executive Survey Insights.

Key Findings
  1. Occupancy rates declined and move-in rates decelerated for many organizations since the surveying began on March 24, 2020. The steepest declines in occupancy and the largest percentage of organizations reporting a deceleration in move-in rates have consistently been reported for the nursing care segment.
  2. In Wave 3, memory care, assisted living, and nursing care segments each report a decline in the change in occupancy compared to the prior week, suggesting continued weakness in these segments in the near future.
  3. A larger share but still minority of respondents in Wave 3 report an acceleration in move-outs in the past 30 days compared to prior waves of the survey.
  4. Across all three waves of the survey, about half of respondents expect no change in their development pipeline going forward, however one-quarter expects their development pipeline to decrease, with most citing uncertainty as the primary reason.
  5. Most organizations continue to mitigate staffing shortages by increasing overtime hours, offering flexible work hours, and remote work where possible. Fewer organizations in Wave 3 than the prior two waves of the survey are hiring agency or temporary staff and professionals from other industries.
Executive Insights Survey Demographics

Responses were collected in three “waves” March 24 through April 19, 2020 from owners and C-suite executives of 180, 146 and 105 seniors housing and skilled nursing operators from across the nation, respectively. Depending on the timeframe measured, one-half to two-thirds of respondent organizations were exclusively for-profit providers, one-half to about one-third were exclusively nonprofit providers, and under 10% operated both for-profit and nonprofit seniors housing and care organizations. Across their entire portfolios of properties, three-quarters of the organizations operate seniors housing properties (independent living, assisted living and/or memory care), roughly one-third, respectively, operate CCRCs (aka Life Plan Communities), and/or nursing care properties.

Insights from Survey Week Ending April 19

Changes in Occupancy Rates
In the most recent survey, week ending April 19, a decline in occupancy rates from the prior month occurred across all care segments, with the deepest declines reported for the nursing care segment. In Wave 3, about 40% of organizations reporting on their nursing care beds noted an occupancy decline of ten percent or more from the prior month, up from about 20% reporting an occupancy decline of ten percent or more in Wave 2.

Regarding the change in occupancy from one week ago, the independent living segment saw the most occupancy stability. However, roughly one-third of memory care units, and under one-half to two-thirds of assisted living units and nursing care beds noted a decline in occupancy compared to the prior week.

Pace of Move-ins and Move-outs

As shown in the chart below, more organizations reported the pace of move-ins decelerated in the past 30-days in Wave 3 than in the prior two waves of the survey. Two-thirds to one-half of respondents attributed the deceleration in move-ins to a slowdown in leads conversion/sales, or resident or family member concerns. Overall, slightly fewer respondents in Wave 3 cited an organization-imposed ban on moving new residents into their communities, and slightly more cited resident or family member concerns than in Wave 2.

The nursing care segment saw the largest deceleration of move-ins in the past 30-days. Reasons cited by respondents include fewer hospitals discharging patients to post-acute care settings for rehabilitative therapy as hospitals defer elective surgeries due to the pandemic, and positive or suspected COVID-19 related moves of residents to isolated units. Nearly one-half of organizations with any nursing care beds cited an organization-imposed ban on move-ins, and nearly one-quarter cited a government-imposed ban on admitting new residents.

A larger share but still minority of respondents in Wave 3 report an acceleration in move-outs in the past 30-days compared to prior waves of the survey. Roughly two-thirds to three-quarters of organizations reporting on their independent living, assisted living and memory care segments saw no change in move-outs—a steady decline from Wave 1 to Wave 3. Just over one-third of organizations with nursing care beds note an acceleration in move-outs in Wave 3.

Mitigating Labor Shortages and Supporting Property Staff

Most organizations continue to mitigate staffing shortages by increasing overtime hours, offering flexible work hours, and remote work where possible. Fewer organizations in Wave 3 than the prior two waves of the survey are hiring agency or temporary staff and professionals from other industries. However, more organizations are beginning to offer additional paid sick leave to support property staff. Survey write-in comments indicate other tactics are being employed such as increasing wages, offering shift bonuses and incentive pay, access to on-site groceries and meals, emergency financial support programs, and temporary housing.

A recent NIC blog post entitled “We Feel We Are Alone in a War Zone” incorporates comments from earlier survey respondents that reflect the impact of the COVID-19 crisis on a human level. One of the key concerns reflected in survey comments is a lack of available, accurate, and timely testing. Survey respondents also worry about the effect that the pandemic is having on already strained labor force issues.

Development Pipeline Expectations

Like previous waves of the survey, one-half of respondents in Wave 3 expect no change in their development pipeline going forward, however one-quarter expect their development pipeline to decrease citing uncertainty as the primary reason. Some of the respondents shared concerns about the economy, restrictions on moving new residents in, access to capital/debt, and cashflow and liquidity issues. NIC MAP® data has shown a deceleration in new construction relative to inventory trending for several quarters.

Going Forward

These are unprecedented times and our deepest concerns go out to those directly impacted by the COVID-19 pandemic and those on the frontline keeping residents of seniors housing and skilled nursing communities safe. These dedicated women and men and their families are making extraordinary sacrifices in these difficult times to protect and serve the most vulnerable among us.

NIC wishes to thank survey respondents for their valuable input and continuing support for this effort to bring clarity and transparency into market fundamentals in the seniors housing and care space at a time where trends are rapidly changing. Your support helps provide both capital providers and capital seekers with data as to how COVID-19 is impacting the space, helping leaders make informed decisions.

If you are an owner or C-suite executive of seniors housing and care properties and have not received an email invitation but would like to participate in the current Executive Survey, please click here for the current online questionnaire.

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Avoiding Loneliness in the Face of Social Distancing

By Ryan Brooks, Senior Principal, Healthcare, NIC

The United States has claimed the top spot globally in known coronavirus cases. States across the country are issuing guidelines to stay at home; an increasing number are mandating a social distancing strategy with shelter in place orders. Seniors housing operators are cancelling all non-essential group activities and events. Essential activities like meals are being staggered to minimize contact with multiple staff members and other residents.

The consensus is COVID-19 is most dangerous for older adults – particularly those with underlying health conditions, who are at the greatest risk of succumbing to the illness that the virus causes. For many of the frailest in our nation’s skilled nursing properties, human touch, familiar faces, and family are critical to their well-being and serve as an antidote to loneliness and depression.

Maintaining the health of this population means taking extra precautions to keep their distance from others and closely heeding the advice of medical professionals to simply stay home. As for visitors, who are usually considered a health benefit by seniors housing and care properties, the safest policy unfortunately must now be a no-visitation policy. While the new restrictions can be difficult for both residents and their families, they are necessary to ensure the health and safety of community residents and the frontline staff who serve them.

How do we ensure that at this critical time, the very important act of social distancing doesn’t result in adverse mental health effects? A key is realizing that physical separation does not unequivocally translate to loneliness. Being alone and being lonely are two very different things. Fortunately, there are a lot of creative ideas being put into practice. Every day I read of innovative solutions, as operators, staff, vendors, and activity directors find creative new approaches to enabling social interaction even at a time when physical distancing is required. There are plenty of examples of socialization being maintained while safe distancing practices are being observed.

Despite aggressive infection control procedures curtailing group activities and social meals, there are still a great number of opportunities for seniors to connect with family, friends, and loved ones during these turbulent times. For some operators, this highly infectious coronavirus has highlighted an opportunity to use technology in seniors housing and care communities to maintain and expand the sense of connections that people have. Others focused on the number of seemingly solitary activities that can provide a sense of purpose, improve mental health, and maintain a sense of connectedness. Here are a few examples of what some communities and the vendors who support them are doing to maintain physical isolation while avoiding the feeling of being socially isolated.

Maintaining a Digital Connection

For families looking to stay updated on their loved ones’ care, software maker SafeKeeping has begun providing its Family Communicator platform to all senior care facilities in the U.S. and Canada – free of charge. Providers who manage resident records with PointClickCare can now give never-before-seen insights to residents’ families. Families can access patient care records, exchange messages with staff, and be notified of major events through secure SMS text and email.

Parker Jewish Institute for Health Care and Rehabilitation has been making personal calls to family members to share information on the status of residents. Recently, the Family Call Center was implemented to simplify the process. Employees from Parker’s Admissions Department and Social Adult Day Health Program were rerouted to staff the new resource, which is assisting with both non-emergent matters and connecting family members through virtual technology.

Staff members of seniors housing and care properties are now increasingly walking family members through the process of accessing technology so they can visit virtually with friends and loved ones. Platforms like Zoom, Discord, and Houseparty provide video-enabled social networking, allowing residents to spend time with people that they care about, bringing them together despite their physical distancing. In many cases, these communication tools are being used between residents and staff as well, as communication that doesn’t require staff to be physically present in the room is safest for all parties involved. While nothing replaces the touch of a loved one, being able to see a smile, blow a kiss, or read a story together can go a long way to ensure that feelings of loneliness are kept to a minimum.

Improved In-Room Interactive Programming

Visitor restrictions for seniors housing and skilled nursing communities are now approaching their second month and if the growth in U.S. confirmed cases is any indication, are not likely to be lifted anytime soon. Activity directors – or purpose matchmakers as I like to call them – have been finding ways to bring interactive programming directly to the rooms of residents. Activities once meant to physically bring residents together are now being offered through the residents’ TV sets with Entertain 360’s MessageNOW software. Instead of cancelling religious services and interactive games, these are now being broadcast directly to residents’ rooms over a dedicated channel. Residents must continue engaging in activities and conversations that enable them to feel connected rather than isolated.

For family members looking to keep residents up to date on their activities, how tall the grandson is getting, or how they are managing their own homebound time, web-connected, digital photo frames are an easy solution. Nixplay picture frames allow for a cloud-based photo to be sent directly to the frame without the need for publication to a wider audience, as is often the case on Facebook or Instagram. These digital picture frames offer one more way to help maintain a sense of mental well-being during this challenging time.

Eversound has been improving well-being in assisted living and memory care communities by enhancing their ability to focus and engage in group events and one-on-one interactions. Their live-streamed interactive programming gives residents the power to connect, discover, and learn from the comfort of their own couch. Eversound recently opened the archives of past live-streamed events and provided them at no cost through the end of April. Included in the archives being made available are art classes, concert series, food and cocktail hours, history lessons, and science classes.

These examples are just a few of the many tools that are now available to help improve in-room programming. Many of these vendors are joining the likes of Never Too Late and being viewed truly as partners to providers, communities, and their residents. In collaboration with operators, they are addressing real needs, and overcoming concerns of social isolation by helping to keep residents engaged in this crisis.

Upholding Mind and Body Health

Residents at The Landings of Mills River have been brushing up on their art skills, having decided to create stained-glass style art on the windows throughout their community for those driving by. They have also been encouraging photo shoots with staff and residents alike. According to Executive Director Joy Elliot, this new program is producing by far the most photos ever taken at the Landings. Perhaps one silver lining is that staff have discovered a program well worth continuing long after the crisis has passed.

Understanding that it is vital for residents to stay active and engaged, many seniors housing operators are also encouraging gardening for their residents. Gardening has been linked with better recovery following surgery, lower rates of anxiety and depression, as well as better stress management. In addition to the rewards of witnessing a cultivation grow, the practice can prove to be beneficial for residents’ physical and mental health. If the thought of starting a garden seems daunting, with safety restrictions in place, consider something as simple as having a few potted plants or herbs on a table or windowsill. These can give a sense of purpose to the resident while practicing safe distancing. Their growth can result in a sense of pride, accomplishment, and responsibility.

As the above examples have shown, physically isolated seniors do not have to feel as though they have become socially isolated. Providers, vendors, staff, and residents are finding creative ways to ensure that physical separation does not translate to social isolation and feelings of loneliness. Vendors implementing solutions to improve social connection in these difficult times are positioning themselves truly as partners to the seniors housing and care communities, because being alone does not unequivocally mean being lonely.

In closing, I would like to encourage everyone to reach for their phones and connect with a loved one.

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University Scholar Connections

By Tom Mathisen, Vice President, Investments, LCS

The volume of connections between university students and the seniors housing and care industry is on the rise. The overall concerted effort of many industry participants has reaped benefits through increased awareness, and more students are choosing careers in the growing field of aging services. Despite the circumstances in which the industry finds itself today, and the impact of COVID-19 on all aspects of society, this important message does not change. In fact, this message becomes even more important. The remarkable efforts put forth by the seniors housing and care industry during these trying times highlight its virtue and resolve. This industry is very clearly filled with numerous high-quality individuals that are passionate about serving the residents who call senior living communities home. This is a lasting narrative and one that should resonate quite well with students that are evaluating their future careers. The intersection of hospitality and healthcare in a mission-driven industry creates a strong sense of purpose.

New programs are being launched that focus on seniors housing and care which will provide options for students interested in the growing field. One example of this is Georgetown University’s Master’s in Aging & Health – Concentration in Senior Living Administration. This concentration was formally launched in 2019 and will feature additional coursework in topics including aging populations, policy and research, health economics, and senior living sales & marketing; followed by a capstone practicum or community based internship. This is in addition to the many, well-established programs focused on senior living and aging services. There are too many to name, but they should all be proud of their contribution to the industry.

Students currently completing undergraduate as well as graduate degrees in many fields of study are increasingly understanding the dearth of high-quality career opportunities available. Yet, within the seniors housing and care industry, an array of prospective opportunities include leading a community, designing cutting-edge new communities, developing new technology for the industry, and constructing efficient capital market strategies for organizations of all sizes. These opportunities barely begin to illustrate the depth of the ability to serve seniors through this dynamic industry. The National Investment Center for Seniors Housing & Care (NIC) is on the front lines of this movement through its Future Leaders Council (FLC), as well as its participation in the extraordinary effort, Vision 2025.

The University Outreach Committee, as part of NIC’s FLC, was launched in 2011 and has been working to facilitate connections between the seniors housing and care industry and universities, specifically, but not limited to, those universities with seniors housing or aging services programs. The primary mediums for this would be facilitation of internship recruiting, communication with university relationships, and on-campus presentations. NIC also offers a conference scholarship opportunity which allows a student, through an application process, to attend a NIC conference. The University Outreach Committee started with a network of seven universities with highly renowned programs including Cornell, Columbia, Washington State, University of Pennsylvania, University of Maryland, University of Southern California, and the University of Wisconsin. Through the efforts of the committee, past NIC FLC members, current NIC board members, and NIC partners, the number of university relationships has grown to 25. Each of the partner universities offer a program that is directly focused on the seniors housing and care industry or is directly tied to the industry.

Internships in the seniors housing and care industry vary a bit in terms of timing during the year, but most ask for applications during the fall for spring and summer internships. In the fall, the FLC reaches out to NIC partner organizations with a request to post internships on the NIC website. The link is included below.

If your company is interested in posting an opportunity or if there are any questions about the program, please contact As links to the various internship opportunities populate the website, the FLC reaches out to partner universities to notify them of these opportunities. The increased visibility and exposure are intended to benefit NIC partner organizations which include private equity groups, banks, REITs, operators, intermediaries, and other service providers. All of this would, of course, be in addition to the recruiting work already being done by each organization.

In addition to the internship program, NIC highly encourages its partners, past committee members, current committee members, and Board members to be active in advocacy for senior living amongst universities. Many have reached out to alma-maters, local universities, and other university contacts with offers to present to students about careers in senior living and emphasize the mission-driven culture and sense of purpose available to them. NIC’s FLC maintains a presentation template that can be utilized for this very purpose.

In addition to direct interaction with universities, NIC is also involved in the extraordinary initiative that is Vision 2025 which was built around the goal of ensuring the health and continuity of the industry through the identification (and development) of at least 25 robust university and college programs by the year 2025. The initial event was held in Chicago and hosted over 30 colleges and universities along with representation from over 35 seniors housing and care operating companies, as well as key trade associations and strategic partners within the industry. The event was sponsored by American College of Health Care Administrators (ACHCA), American Health Care Association/National Center for Assisted Living (AHCA/NCAL), American Senior Housing Association (ASHA), Argentum, LeadingAge, National Association of Long Term Care Administrator Boards Foundation (NAB Foundation), and NIC. Ziegler also served as the event sponsor for the symposium. Look for this to continue and grow in the future.

With an eye on the future, the NIC University Outreach movement will look to add university relationships by leveraging the broad reach of NIC as well as its partners and its volunteer leadership. As well, the committee will look for new ways to enhance the connection between the seniors housing and care industry and academia.

The world of seniors housing and care is evolving and the need for talented individuals is greater than ever before. A consistent theme is the need to tell the story of this dynamic industry that offers a strong sense of purpose. Every interaction with a student makes a difference and should not be underestimated.

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Submit Your Photos for the NIC Investment Guide

The sixth edition of the NIC Investment Guide: Investing in Seniors Housing & Care is scheduled to publish in fall 2020. We invite your organization to submit photos of seniors housing and nursing care properties to be featured within this publication.

The NIC Investment Guide is a primer for understanding the seniors housing and care sector. It provides the most reliable industry data for investors to help them evaluate risks and returns, and to fine-tune their individual investment strategies.

What We’re Looking For:

  • Images of property interiors or exteriors (new and older properties).
  • Images of property amenities.
  • Images that include residents and/or staff are welcome.

To submit images for the opportunity to be featured in the NIC Investment Guide, review the file requirements and submission form found on our website. Files must be received by May 15, 2020.

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