News & Press Releases
Key Financial Indicators Show Seniors Housing and Care Continues Strong Performance
Press Room – 2007 NIC Press Releases
Key Financial Indicators Show Seniors Housing and Care Continues Strong Performance
FOR IMMEDIATE RELEASE: July 3, 2007
Contact: Renee Tilton, (410) 626-0805 or rtilton@crosbymarketing.com
Annapolis, Md. – The seniors housing and care industry is healthy and performing well, according to the first quarter 2007 NIC Key Financial Indicatorsä released today by the National Investment Center for the Seniors Housing & Care Industry (NIC).
“The industry continues to be strong and is holding steady with its performance levels from the fourth quarter of 2006, which in itself was the best quarter that the industry has seen since we started keeping track of these indicators in the late 1990s,” said Robert G. Kramer, NIC president. The number of performing loans during the first quarter stood at 99.25 percent, a .2 percent increase compared to the same period in 2006.
Loan volume placed during the first quarter of 2007 was $2.28 billion, up slightly from $2.22 billion placed in the fourth quarter of 2006. “The amount placed this quarter represented a 172 percent increase from the first quarter of 2006, when the loan volume was $838 million,” explained Kramer. “Year-over-year loan volume amounts were impressive for all sectors, especially for assisted living with a 263 percent increase and skilled nursing with a 185 percent increase.”
This loan volume represents the quarterly lending activity of major national lenders (non-REITs) that make permanent and short-term debt investments in seniors housing and care, including Fannie Mae, Freddie Mac, and several of the larger credit companies and banks.
Mean occupancy rates for 2007’s first quarter softened slightly for most sectors, with a one percentage point or less drop compared to the previous quarter for assisted living, skilled nursing and continuing care retirement communities (CCRCs). Independent living went from 92.5 percent in the fourth quarter of 2006 to 91 percent in the first quarter of 2007.
NIC draws its occupancy rate data from market-rate properties open at least 24 months. More than 3,200 properties and 376,500 units were reflected in this quarter’s data summary.
Interestingly, statistics from NIC MAP® (www.NICMAP.org), another data and analysis service from NIC that tracks quarterly key performance metrics in the nation’s top metro markets, showed no drop in occupancy rates in the 31 largest metropolitan statistical areas (MSAs). During the first quarter of 2007, average occupancy rates for stabilized properties in these markets were the same or slightly higher for skilled nursing, assisted living and independent living compared to the fourth quarter of 2006.
Mean capitalization rates changed very little in the first quarter of 2007 versus the fourth quarter of 2006. Rates for independent living were unchanged at 7.7 percent; they were up slightly for assisted living to 8.8 percent and down slightly for skilled nursing properties to 12.6 percent.
Each quarter, the nation’s leading senior living lenders, owners/operators and appraisal professionals report their key financial and performance data to NIC. The results are posted free of charge as the NIC Key Financial Indicators™ at www.NIC.org/kfi/.
About NIC: Founded in 1991, the National Investment Center for the Seniors Housing & Care Industry is a nonprofit education and research organization providing information about business strategy and capital formation for the senior living industry. NIC is the leading provider of historical and trend data on the industry through its Key Financial Indicators™ (KFIs) that report nationwide statistics and its Market Area Profiles (MAP®) Data and Analysis Service that tracks properties in the 100 largest metropolitan areas. Proceeds from its annual conference are used to fund research on issues of importance to the industry, including data useful to policymakers making decisions about seniors housing and long-term care. For more information, visit www.NIC.org or call (410) 267-0504.