Many operators have been eagerly anticipating a boost in occupancy due to the COVID-19 vaccine availability, and the latest executive survey results, released Thursday from the National Investment Center for Seniors Housing & Care, suggest an uptick is underway.
The latest data — collected March 22 to April 4 from 64 operators from across the country — continue to show a trend in the shares of organizations noting an increase in occupancy across all four care segments, and each of the care segments are at or near the respective time series high points in terms of reports of occupancy increases.
Fully 56% of respondents reported an increase in prospect interest specifically related to the COVID-19 vaccine, up from 25% in late January and early February. In addition, increased resident demand was cited by nine out of 10 respondents as a reason for acceleration in move-ins in the past 30-days, the highest point in the survey time series.
Even more promising was the fact that one-quarter of respondents in the latest wave of the survey reported that their organizations had a backlog of residents waiting to move in (23%). Further, the share of organizations currently offering rent concessions has remained at approximately 50% since the Wave 12 survey, conducted mid- to late-September.
It’s worth noting, however, that the degrees of occupancy increases vary. The largest degrees of upward changes in occupancy rates were reported in the nursing care segment, with 32% reporting upward changes of 5% to 10%. Reports of occupancy increases in organizations with independent living residents is at a pandemic high, but the degree of change is weaker than the other care segments, with one-quarter reporting increases of 0.1% to 3%.
The survey also found that staffing shortages that were experienced by many operators prior to and exacerbated by the pandemic persist. Currently, more than two-thirds (68%) of organizations report staffing shortages within their portfolio of properties. As a result, nearly all respondents to the latest survey reported that they are paying staff overtime hours (97%), up from a prior peak of 92% in the late December/early January. Further, four out of five organizations are currently tapping agency/temp staff (82%).
Both factors are at a time series high. As a result of these ongoing staffing issues, net operating income continues to be pressured for many operators.
“On one hand, the market fundamentals continue to show signals of progress due to the availability and widespread distribution of the COVID-19 vaccine among America’s seniors — on the other hand, staffing challenges and wage pressures are continuing to put strain on NOI for many operators,” wrote Lana Peck, NIC senior principal, in a blog post. She added that the next wave of the survey will include data from respondents on strategies operators are implementing to attract staff.