by admin

ANNAPOLIS, MD. — The seniors housing sector continued its recovery in the third quarter of 2012 posting an average occupancy rate of 88.8 percent, according to NIC MAP, a data analysis service of the National Investment Center for the Seniors Housing & Care Industry. This figure is up 0.2 percentage points from the previous quarter and 0.8 percentage points from one year ago.

“Occupancy is now at a four-year high and with inventory growth remaining tempered, we should continue to see occupancy recover in the near term,” says Michael Hargrave, vice president of NIC MAP.

The average occupancy rate for the seniors housing industry has increased consistently during the past 10 quarters. The figure is 1.8 percentage points more than its cyclical low of 87 percent, which occurred in the first quarter of 2010.

The occupancy rate for independent living and assisted living properties both averaged 88.8 percent in the third quarter of 2012. Both types of properties showed improvement over the previous quarter, increasing 0.1 and 0.2 percentage points, respectively.

Source: NIC MAP

Annual rent growth is also experiencing record highs in the seniors housing community. Annual asking rents for seniors housing increased 2.2 percent in the third quarter, up from 1.9 percent in the second quarter. This increase is 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.

While the occupancy rate and year-over-year rent growth continued to accelerate, the third quarter recorded decreased construction activity for seniors housing projects. The seniors housing annual inventory growth rate was 1.3 percent, which is the same as the second-quarter figure, and compares to 1 percent from the third quarter of 2011. Current construction as a share of existing inventory for seniors housing was 2 percent, 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 annual inventory growth was negative 0.3 percentage in the third quarter of 2012, continuing the trend of slightly declining inventory growth amid an environment of increased occupancy.

You may also like