The Price of Age in Skilled Nursing
We have covered the demise of the 40-year-old skilled nursing facility in articles and webinars over the past few years, and the acquisition market has taken notice. In 2015, 52% of the properties sold were 40 years old and older, which made sense since nearly half the entire U.S. inventory of SNFs are this old. By 2016, however, 52% of the properties sold were between 20 and 40 years old, which in many cases are considered to be relatively “new.” This helps explain why the average and median price per bed jumped so much in 2016. The percentage in the newest category (less than 20 years old) remained relatively similar from 2015 (22%) to 2016 (20%). With the newer skilled nursing... Read More »Pay Up, Up North
Once again on the seniors housing side, the Northeast region has topped the charts for the seventh year in a row (per the 22nd Edition of The Senior Care Acquisition Report), rising to new heights at $292,900 per unit, up 46% from $201,100 per unit in 2015 and even up 4% from 2014’s average of $281,700 per unit. With its high land values and construction costs, it is not surprising that the Northeast has the highest prices. Plus, the Northeast properties are generally in heavily populated, wealthier areas, driving rents up. The West, dominated by sales in expensive markets such as Los Angeles, San Francisco and Seattle, not surprisingly was valued second-highest among the regions,... Read More »Adding Value With Memory Care
Over the last two cycles, an interesting trend has occurred in the valuations of assisted living versus assisted living with a memory care component. At the beginning of bull markets, traditional, standalone assisted living communities typically are priced higher than communities with memory care. Then as the bull market strengthens or peaks, the reverse is true, and assisted living/memory care (AL/MC) communities overtake traditional assisted living. This was never more true than in 2016, the sixth year of this bull market. Communities with a memory care component sold on average for $225,400 per unit, according to the 22nd Edition of The Senior Care Acquisition Report, while AL-only... Read More »Seniors Housing Occupancy Continues Its Decline
As many people expected, seniors housing occupancy levels declined in the first quarter this year, with assisted living posting larger declines than independent living. According to the recently released NIC MAP data, primarily assisted living communities in the 31 primary markets posted a sequential drop in occupancy of 50 basis points to 87.2%, and a year-over-year drop of 100 basis points. Even though these numbers were sort of expected, there was some hope that the sector was starting to turn things around in the quarter. Not yet. It was a little surprising that half the year-over-year drop came in one quarter, however. On the independent living side, occupancy in the top 31 markets... Read More »Assisted Living Commands a Portfolio Premium in 2017
Every year in our Senior Care Acquisition Report, we try to determine what a market “portfolio premium” would be for assisted living communities, with a portfolio including three or more properties. However, just because there is a portfolio of properties, it doesn’t always mean that the buyer will pay more for them. The premium has to do with both the number of properties as well as the quality. In most years, there is a sizable difference in the average price per unit for portfolios compared with smaller purchases. In 2016, we recorded a drop in the premium to $45,700 per unit, or a 4% drop from 2015’s $47,600 per unit premium. Both premiums fall short of the record ($69,000 per unit in... Read More »Schedule a demo
Gain access to the best healthcare and long-term care investment intelligence, data, and analysis.
