Well, it shouldn’t have surprised anyone, but occupancy levels for stabilized independent living and assisted living continued their drop in the month of May, according to NIC MAP. Across the country’s 31 largest metropolitan areas, assisted living properties first fell by 170 basis points from 87.8% in March (the first full month of the COVID-19 pandemic) to 86.1% in April. The sector occupancy fell by a lesser degree in May, by 90 basis points to 85.2%. So, in total, that is a 360-basis point drop for assisted living since the pandemic began.
The independent living sector has so far fared better than assisted living, but it also has the benefit of being in a stronger position going into the pandemic. Occupancy has decreased from 91.4% in March to 90.1% in April, finally down to 89.5% in May, an overall 190-basis point drop. Given its relatively younger, healthier residents and longer lengths of stay, compared with assisted living, that is no surprise. Both rates of decline decreased in May, but it is still too early to know where the bottom may be.
We’ve certainly heard of varying declines in occupancy from different operators. Some companies have reported similar declines in their occupancy. National Health Investors’ portfolio of 41 properties operated by Bickford Senior Living has seen a 240-basis point decrease in occupancy from 86.6% in March to 84.2% in May. Brookdale Senior Living lost 220 basis points in occupancy in one month alone, from 82.2% on March to 80% on April 30.
Others have seen worse declines, with Welltower disclosing it saw occupancy in its SHOP portfolio drop by 420 basis points in the second quarter through May 29, luckily with the downward trend slowing down towards the end of May. Ventas also disclosed that its SHOP occupancy at May 21 was 79.2%, down 480 basis points from 84.0% on April 2. So, it may in fact be worse out there than the NIC numbers may suggest. We hope not.
The good news is that move-ins are accelerating, tours are resuming, and cases and deaths from COVID-19 are also much lower than they were a couple of months ago. But we’ll feel better when we know we’ve already hit the bottom.
