Print Friendly  |  
  • LinkedIn
  • Add to Favorites


 NIC Says 1Q Seniors Housing Occupancy Slips, but Nursing Care Rates Climb

While the overall occupancy rate for seniors housing properties declined in the first quarter of 2017, the number of beds filled in skilled nursing care centers increased in the first three months of the year, according to a report released on April 12 by the National Investment Center for Seniors Housing & Care (NIC).
The group said the nursing care occupancy rate rose to 87.2 percent in the first quarter, from 86.8 percent at the end of 2016. “The nursing care annual inventory growth rate was virtually zero in the first quarter of 2017, while annual absorption was down by -0.4 percent. Private-pay rents for the sector grew 2.7 percent year-over-year this quarter, down 0.2 percentage point from year-earlier levels,” NIC said.
For all seniors housing, the occupancy rate for the first quarter averaged 89.3 percent, as net additions to inventory outpaced absorption of units. This number marks a decrease of 0.3 percentage point from the prior quarter and was down 0.6 percentage point from the same period a year ago.
“As of the first quarter of 2017, occupancy was 2.4 percentage points above its cyclical low of 86.9 percent during the first quarter of 2010 and 0.9 percentage point below its most recent high of 90.2 percent in the fourth quarter of 2014,” NIC said.
In breaking down the occupancy rates, the report said independent living and assisted living properties averaged 90.9 percent and 87.2 percent, respectively, during the first quarter of 2017. The occupancy rate for independent living was off 0.2 percentage point from the final quarter of 2016 and down 0.3 percentage point from the same period year-earlier levels.
“The occupancy rate for assisted living was down 0.5 percentage point from the fourth quarter and down 1.0 percentage point from year-earlier levels. Occupancy for assisted living was at its lowest level since early 2010 when it stood at 86.9 percent,” NIC said.
The annual absorption rate for seniors housing was 2.8 percent as of the first quarter of 2017, up 0.1 percentage point from the fourth quarter of 2016 and 0.2 percentage point higher from one year earlier.
“It was another active quarter for inventory growth, with nearly 4,800 units added to the seniors housing stock in NIC MAP’s 31 Primary Markets. At the same time, demand slowed during the quarter, as is typically the case in the first quarter due to the seasonal effects of the winter months,” said Beth Burnham Mace, chief economist for NIC. She added that a portion of the slowdown in net absorption may also have resulted from the severity of the 2016/2017 flu season.
NIC said current construction as a share of existing inventory for seniors housing slowed 0.3 percentage point from the prior quarter to 5.8 percent and was 0.7 percentage point under its recent high of 6.5 percent in the third quarter of 2016.
Seniors housing construction starts during the first quarter of the year reached 2,845 units, which included 1,388 independent living units and 1,457 assisted living units. On a preliminary four-quarter basis, starts totaled 18,366 units.
On rent levels, during the first quarter the average rate of seniors housing’s annual asking rent growth was 3.3 percent, down 0.4 percentage point from the prior quarter, but up from 3.1 percent in the first quarter of 2016.
Facebook.png   Twitter   Linked-In   ProviderTV   Subscribe

Sign In