The senior housing industry was one of the first sectors to feel the effects of the pandemic. In the wake of the outbreak, demand for senior housing immediately plummeted.
The overall occupancy rate dropped to 84.9 percent in the second quarter of 2020, down 2.8 percent from the 87.7 percent recorded in the first quarter of the year, according to NIC MAP Data Service, provided by the National Investment Center for Seniors Housing & Care (NIC).
Since the outbreak began, developers have also become more cautious. The new supply pipeline accounted for 6.2 percent of total inventory in the second quarter of 2020, down 40 basis points over the previous quarter, NIC reported. Nonetheless, the expectations for the development pipeline going forward have improved over the past few months, according to the NIC Executive Survey Insights presented during the first day of the NIC 2020 Fall Conference. As of August, 30 percent of survey respondents predicted an increase in development activity going forward, while back in April, only 15 percent of respondents shared this outlook.
Although near-term challenges are here to stay, the demand for senior housing communities won’t diminish. Developers, however, do have to take note of how the coronavirus outbreak will impact design, and ultimately alter the way communities are built to ensure a safer environment for senior housing residents, a population cohort most vulnerable to COVID-19.
FROM PRE-COVID-19 TRENDS TO POST-PANDEMIC CHANGES
Over the past decade, senior living design has significantly evolved. Instead of the cold, institutional look, senior housing communities now provide more hospitality-like experiences with multiple dining options, a thorough emphasis on health and wellness and a real sense of community, said David Segmiller, principal at Hord Coplan Macht, in a talk during the NIC 2020 Fall Conference.
“The greatest part about these trends is that they were all about socialization, which is the best part about senior living,” Segmiller said. However, while the goal is to keep these trends, the concepts “will be challenged in a post-pandemic environment,” he added.
While operators and industry players need to adapt quickly to new situations and overcome difficulties, the challenge for the industry is not to overreact. Operators need to understand how existing spaces can be flexible to accommodate future issues, like another pandemic. The question is “how to create spaces that function on a very social way on a normal basis but can be retrofitted for other uses down the road,” noted Segmiller.
Although senior housing design has come a long way, the global health crisis has revealed aspects that still require rethinking and improvements. Some problematic design standards include 40-60 resident units, multiple residents per room and large dining venues. According to Segmiller, the solution to these issues might be decentralized nursing homes and more satellite communities.
Long term changes could also include decentralized amenity spaces, more remote activity areas, smaller dining venues, multi-program spaces that are easily cleaned and turned over for other uses and more exterior fitness areas. Additionally, in the future, there will be a growing need for more square footage to accommodate activities and amenities.