Assisted living per-unit prices rise for the latest four quarters, while skilled nursing remains the same.
It was a relatively slow first quarter with regard to publicly announced seniors housing and care acquisitions, other than some old large deals announced last year that finally closed in the quarter. On a rolling four quarters basis, the average price for assisted living jumped to $210,300 per unit for the period ended March 31, compared with $193,650 per unit for calendar year 2016. The average cap rate remained at 8.5% but with an obvious wide range. Meanwhile, independent living did the reverse, dropping to $208,900 per unit for the four quarters ended March 31 compared with $228,200 per unit for calendar year 2016. The IL average cap rate increased by 20 basis points to 7.4%.
In the skilled nursing sector, we have been waiting for prices to come down, but the trailing four quarters didn’t budge, coming in at $99,300 per bed, the same as last year. And average SNF cap rates only rose 10 basis points to 12.3%. So despite worries on labor costs, development and interest rates, buyers in general are plowing ahead, but mostly in the AL and IL market.
Very interesting statistics. Assisted living seems to be rising steadily.