News & Press Releases
Seniors Housing Occupancy at a Four Year High
FOR IMMEDIATE RELEASE: Thursday, October 11, 2012
Contact: Biba Aidoo, (410) 267-0504 or baidoo@nic.org
SENIORS HOUSING OCCUPANCY AT A 4-YEAR HIGH
NIC MAP® Data Shows Strong Absorption, Stronger Rent Growth, and Slightly Less Construction Activity
ANNAPOLIS, Md.— ANNAPOLIS, Md. – The seniors housing occupancy rate continued its recovery in the third quarter of 2012, while year-over-year rent growth accelerated and overall construction activity slightly declined, according to NIC MAP®, a data 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 third quarter of 2012 was 88.8%, an increase of 0.2 percentage points from the prior quarter and a 0.8 percentage point increase from a year earlier. The seniors housing average occupancy rate has risen consistently during the past 10 quarters and is 1.8 percentage points above its cyclical low of 87.0% in the first quarter of 2010.
Annual asking rent growth for seniors housing accelerated to 2.2%, from 1.9% in the second quarter of 2012, and was 0.6 percentage points above the pace from the third quarter of 2011. “The pace of annual rent growth is now at its highest level since the fourth quarter of 2009 and now above core inflation for the first time since the fourth quarter of 2010,” says Chuck Harry, NIC’s director of research and analysis.
For seniors housing properties, annual absorption was 2.2% in the third quarter of 2012, compared to 2.3% in the second quarter of 2012 and 1.9% a year earlier. “This is now the eighth consecutive quarter where the pace of annual absorption is above that of annual inventory growth, which is encouraging for continued increases in occupancy through the next few quarters,” says Harry.
In the third quarter of 2012, the seniors housing annual inventory growth rate was 1.3%, which is unchanged from the second quarter of 2012 and compares to1.0% a year earlier. Current construction as a share of existing inventory for seniors housing was 2.0%, which is 0.2 percentage points below that of the previous quarter. “While construction activity declined this quarter, it is more a result of an increase in completions rather than a decrease in construction starts,” says Harry.
The nursing care occupancy rate was 88.0% in the third quarter of 2012, which is an increase of 0.1 percentage points from the second quarter of 2012. Nursing care occupancy has been marginally declining for several years.
Nursing care annual inventory growth was -0.3% in the third quarter of 2012, continuing the established trend of slightly declining inventory growth. Private pay rents for the sector grew 3.0% year-over-year this quarter, which is down slightly from the 3.1% pace reported in the second quarter of 2012.
About NIC
The National Investment Center for the Seniors Housing & Care Industry (NIC) is a 501(c)(3) organization whose mission is to facilitate informed investments that create value and further the quality of seniors housing and care. NIC’s NIC MAP® Data and Analysis Service tracks more than 12,600 properties on a quarterly basis in the 100 largest metropolitan markets. Proceeds from its national conference and other events are used to fund data and research on issues of importance to lenders, investors, providers, developers, 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.