Lead volumes are heading toward pre-pandemic levels, and construction lending is on the rise, according to Wave 34 of the Executive Survey released Thursday by the National Investment Center for Seniors Housing & Care.
The survey included responses collected Oct. 4 to Nov. 7 from owners and executives of 74 small, medium and large senior living (independent living and assisted living) and skilled nursing operators from across the country, representing hundreds of buildings and thousands of units across respondents’ portfolios of properties. Fifty-one percent of respondents are exclusively for-profit providers, 36% operate not-for-profit, and 13% operate both. Many respondents in the sample report operating combinations of property types.
Thirty-three percent of the organizations that responded to Wave 34 reported that lead volumes had reached pre-pandemic levels, which NIC noted is a significant jump from the approximately 20% reported in April.
The pace of move-ins for independent living and/or assisted living units remained steady from the Wave 33 survey, with approximately 50% of Wave 34 respondents reporting that the pace of move-ins had accelerated in the past 30 days.
Fewer organizations with memory care units saw an acceleration in move-ins since the Wave 33 survey (38% compared with 48%). Approximately 50% of the respondents with independent living and/or assisted living units reported higher occupancy rates. Organizations with nursing care beds reported equal levels of increases and decreases in occupancy (38%).
Most occupancy increases across all sectors were between 0.1 and 3 percentage points. Approximately 20% of organizations with assisted living and/or memory care units saw occupancy increases of three percentage points or more, the survey noted.
During the pandemic, new construction was virtually nonexistent. In Wave 3 (April 13 – 19, 2020), only 15% of operators said they expected their development pipelines to increase, primarily due to projects already underway. By comparison, in Wave 34, 41% of respondent organizations said they expect their development pipelines to increase.
“However, challenges to the practicality of new construction and timelines persist due to labor and key materials shortages and relatively high costs,” NIC Senior Principal Lana Peck wrote.
Labor shortages continue to challenge net operating income across the board, along with wage increases, pandemic-related decline in occupancy rates and the inability to grow rents. Roughly half of respondents indicated they expect operating margins to increase. Slightly more operators in Wave 34, however, anticipate smaller increases than in Wave 33, Peck wrote.
The Wave 34 survey added a question not found in previous waves, to gauge operator interest in diversifying their products to serve a different resident. Although 64% of responding organizations stated that they were not considering changing their product mix, 23% reported considering expanding their offerings toward settings serving older adults with fewer activities of daily living or healthcare needs
