News & Press Releases
Seniors Housing Occupancy Rises to 90.1% as Strong Demand Surpasses Inventory Growth for Second Consecutive Quarter
Construction Activity Reaches New Cyclical High
FOR IMMEDIATE RELEASE: Wednesday, January 6, 2016
Contact: Biba Aidoo, (410) 267-0504 or email@example.com
ANNAPOLIS, Md. – The average occupancy rate for seniors housing properties in the fourth quarter of 2015 was 90.1% as net absorption of units outpaced the additions to inventory. This represented an increase of 0.2 percentage point from the prior quarter, and was 0.2 percentage point shy of its cyclical peak of 90.3% that was reached one year earlier. As of the fourth quarter of 2015, occupancy was 3.3 percentage points above its cyclical low of 86.9% during the first quarter of 2010.
The occupancy rate for independent living properties and assisted living properties averaged 91.4% and 88.4%, respectively, during the fourth quarter of 2015. When compared to the prior quarter, the occupancy rate for both independent living and assisted living increased by 0.2 percentage point. Occupancy for independent living was still 0.1 percentage point above year-ago levels, compared with assisted living, which was down 0.5 percentage point from the fourth quarter of 2014.
During the fourth quarter of 2015, the rate of seniors housing’s annual asking rent growth was 2.6%, which was 0.1 percentage point above the prior quarter’s pace and unchanged from its pace one year earlier during the fourth quarter of 2014.
Seniors housing annual absorption was 2.0% as of the fourth quarter of 2015, compared to 1.9% during the third quarter of 2015 and 2.6% during the fourth quarter of 2014.
In the fourth quarter of 2015, the seniors housing annual inventory growth rate was 2.2%, up 0.1 percentage point from the prior quarter and its strongest pace since 2010. Current construction as a share of existing inventory for seniors housing accelerated 0.2 percentage point to 5.5% as of the fourth quarter of 2015, which represents a new cyclical high.
“Since its low point in the second quarter of 2015, the seniors housing occupancy rate has increased by 40 basis points, but remains 20 basis points below its most recent cyclical peak in late 2014,” noted Beth Burnham Mace, chief economist for NIC. “This shows that demand has generally been able to keep pace with the significant growth we’ve seen in supply and speaks to the relatively solid fundamentals in the sector.”
Chuck Harry, NIC’s managing director and director of research and analytics, said that, “While seniors housing’s rate of inventory growth of 2.2% during 2015 remained well below its prior peak pace of 2.9% in 2008, the expected seniors housing completions during 2016 among those units currently under construction will likely result in 2016’s rate of inventory growth registering closer to 2008’s pace.”
The nursing care occupancy rate decreased 0.1 percentage point to 87.4% during the fourth quarter of 2015.
Nursing care annual inventory growth was -0.1% in the fourth quarter of 2015, while annual absorption was down 1.0%. Private pay rents for the sector grew 3.0% year over year this quarter, which was up 0.3 percentage point from the prior quarter.
[Note: For 4Q15 NIC MAP data specific to your local metro market, please refer to the regional key metrics charts.]
The National Investment Center for Seniors Housing & Care (NIC) is a 501(c)(3) organization whose mission is to advance the quality and availability of seniors housing and care options for America’s elders. NIC provides research, education, and increased transparency that facilitate leadership development, quality outcomes, and informed investment decisions with respect to seniors housing and care.
Since 1991, NIC has been the leading source of research, data and analytics for owners, operators, developers, capital providers, researchers, academics, public policy analysts, and others interested in meeting the housing and care needs of America’s seniors. NIC has proudly sponsored the Seniors Housing & Care Journal, a peer reviewed journal for applied research in the seniors housing and care field, since 1993. One of NIC’s major initiatives to further its mission is the NIC MAP® Data Service (NIC MAP). NIC MAP is a web-based suite of research and analysis tools that tracks and reports seniors housing and care data, enabling users to gain access to more than 13,000 properties within 99 U.S. metropolitan markets. Established in 2004, NIC MAP creates transparency for seniors housing and care by offering accurate, unbiased and actionable market-level data on all of the sector’s property types and care segments including independent living (IL), assisted living (AL), memory care, and nursing care, as well as continued care retirement communities (CCRCs). Our data is updated quarterly, monthly, and weekly, and is inclusive of property-level inventory by unit type, sales transactions, properties under construction and in the planning phase, aggregated occupancy and rent comparables, demographics, and much more. For more information, visit www.nic.org or call (410) 267-0504.