Continuing care retirement communities are expected to hold much appeal to baby boomers, and the good news is, the first wave of boomers will be entering the target age range for such communities within the next five years, notes a new “Market Insight” report from CBRE.
CCRC residents tend to be more educated and “sophisticated,” according to the commercial real estate services and investment firm. Baby boomers have much more education and a wider range of life experiences than their parents, and they also are “well known for placing a high value on lifestyle,” the authors add. They also have fewer children so “will be more predisposed to look for housing and care options for the rest of their lives,” according to the report.
CCRC residents also tend to be more demanding, CBRE says, so the communities of the future may look different from the CCRCs of today. The model, also known as the life plan community, already appears to be moving more toward a rental model and away from offering a full continuum of care, according to the report. Semi-private rooms are being converted to private ones, or skilled nursing wings are being changed to centers for rehabilitation.
The oldest baby boomers are turning 72 this year, and CCRC residents typically are in their late 70s to mid-80s at move-in, according to CBRE.
“Initially, demand from baby boomers will rise at a slow pace, but by the mid-2020s, the increase will be much more significant,” the report authors note.
Until then, relatively high occupancy, rent growth that outperforms other seniors housing sectors and somewhat limited supply will position CCRCs for “solid performance” in the short term, the report states.