News & Press Releases
Seniors Housing Occupancy Continues Recovery
OR IMMEDIATE RELEASE: Friday, July 13, 2012
Contact: Jessica Palmeri, (410) 267-0504 or jpalmeri@nic.org
SENIORS HOUSING OCCUPANCY CONTINUES RECOVERY
NIC MAP Data Shows Strong Absorption, Construction Activity Gaining Traction, and Stronger Rent Growth
ANNAPOLIS, Md.—The seniors housing occupancy rate continued its recovery in the second quarter of 2012, while construction activity gained traction and year-over-year rent growth accelerated, according to NIC MAP, a data and analysis service of the National Investment Center for the Seniors Housing & Care Industry (NIC).
Overall, the average occupancy rate for seniors housing properties in the second quarter of 2012 was 88.6 percent, an increase of 0.3 percentage points from the prior quarter and a 0.9 percentage point increase from a year earlier. The seniors housing average occupancy rate has risen consistently during the past nine quarters and is 1.6 percentage points above its cyclical low of 87 percent in the first quarter of 2010.
Annual rent growth for seniors housing accelerated to 1.9 percent from 1.2 percent in the first quarter of 2012 and was 0.4 percentage points above the pace during the second quarter of 2011. The pace of annual rent growth is now at its highest level since the fourth quarter of 2009.
For seniors housing properties, annual absorption in the second quarter of 2012 was 2.3 percent, compared to 2.1 percent in the first quarter of 2012 and 1.7 percent one year earlier. “This is now the seventh consecutive quarter where the pace of annual absorption is above that of annual inventory growth, reflecting both solid demand and recently tempered levels of construction,” said Chuck Harry, director of research and analysis at NIC.
During the second quarter of 2012, the seniors housing annual inventory growth rate was 1.3 percent, compared to 1.2 percent in the first quarter of 2012 and 1.1 percent a year earlier. Current construction as a share of existing inventory for seniors housing was 2.1 percent, which is unchanged from the previous quarter. “This stabilization in construction activity hints that we may be at the beginning of a new phase in the development cycle,” Harry said.
The nursing care occupancy rate was 87.9 percent in the second quarter of 2012, which is a decline of 0.3 percentage points from the first quarter of 2012. This continues the trend of marginally declining nursing care occupancy that has been underway for several years.
Nursing care annual inventory growth was -0.3 percent in second quarter of 2012, continuing the established trend of slightly declining inventory. Private pay rents for the sector grew 3.1 percent year-over-year this quarter, which is slightly stronger than the 3 percent pace reported in the first quarter of 2012.
About NIC
For more than 20 years, the National Investment Center for the Seniors Housing & Care Industry (NIC) has been committed to advancing the quality of seniors housing and care by facilitating informed investment decisions for investors, lenders, owners, operators and developers through groundbreaking research, actionable data and dealmaking events. NIC is the leading provider of historical and trend data on the industry through its NIC MAP® Data and Analysis Service that tracks more than 12,500 properties on a quarterly basis in the 100 largest metropolitan markets. Proceeds from its annual conference and other events are used to fund data and research on issues of importance to lenders, investors, developers, operators, and others interested in meeting the housing and care needs of America’s seniors. For more information, visit www.NIC.org or call (410) 267-0504.