Senior Housing Occupancy Drops, Inventory Increases: NIC
- Nov 05, 2020
Assisted living senior housing properties in the NIC MAP Primary Markets continue to see steeper occupancy declines since the pandemic began than independent living properties, dropping 6.1 percentage points since March to an all occupancy rate of 79.1 percent, according to the NIC Intra-quarterly Snapshot for September.
It was another record low for assisted living occupancy rates, though a smaller drop from the previous record low in August of 79.5 percent. The majority independent living occupancy rate was also down, hitting 84.9 percent, but well above the majority assisted living rate in the NIC MAP Primary Markets recorded for September. The overall senior housing occupancy rate for the third quarter was 82.1 percent, down 2.6 percentage points from the second quarter of 2020 and the second quarter in a row where occupancy fell more than 2.5 percentage points.
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Beth Burnham Mace, chief economist for the National Investment Center for Seniors Housing & Care (NIC), said the pandemic and its impact on demand is “affecting all senior housing across the board regardless of the product type, regardless of the location.” While the state moratoriums or self-imposed moratoriums by operators on move-ins that occurred at the beginning of the COVID-19 crisis have largely gone away now, Mace said demand is still down in some areas because of concerns by potential residents or family members.
Occupancy rates among the 31 major metro markets included in the NIC MAP’s Primary Markets varied with New York’s independent living occupancy continuing to slide, falling 1.5 percentage points from the August reporting period to 84.5 percent. It was down 7.7 percent from year-earlier levels, the intra-quarterly report showed. Meanwhile, the independent living occupancy for Riverside, Calif., was up to 79.6 percent between August and September but down overall for the year.
Denver’s assisted living occupancy improved in the September reporting, inching up 0.6 percentage points to 77.1 percent. Although Denver’s AL occupancy was down overall year-to-year, the September occupancy rate was still good enough to place 21st among the 31 Primary Markets, according to the NIC. The majority assisted living occupancy rate in Kansas City, Mo., continued to drop but was at 82.4 percent for September.
Inventory of majority independent living properties for the NIC MAP Primary Markets increased by 1,955 units in the September reporting following five months of moderate gains. The inventory had increased by 1.3 percent, or 4,358 units, since March. Inventory for majority assisted living properties rose by 1.4 percent over the same period but year-over-year was down 3.1 percent. The report noted year-over-year inventory growth for the majority independent living properties rose by 2.8 percent.
The report noted Atlanta (up 8.3 percent) and San Diego (up 8 percent) saw the largest inventory gains in the past year among the independent living properties while Miami (up 10.3 percent) and Philadelphia (up 10 percent) had the greatest inventory increases year-over-year for the assisted living properties.
Mace said the new inventory reflects properties approved and financed several years ago that are being delivered now.
“There was a fair amount of cheap capital that fueled development activity,” Mace told Multi-Housing News.