COVID-19 had a particularly marked effect on the seniors housing industry in the second quarter, resulting in steep inclines in vacancy, according to a new quarterly update from Moody’s Analytics REIS.
The report showed that, overall, the sector’s vacancy rate last quarter jumped to 12.3%. The pandemic had varying effects however, depending on subtype. The most significant spike in vacancy came in memory care, which increased by 2.7% last quarter. Assisted living and memory care experienced the highest vacancy rates overall, tallying 13.6% and 13.8%, respectively. Skilled care reported the lowest vacancy rate, coming in at 11.6%, according to Moody’s Analytics.
“A steady increase in vacancy has been the trend in the sector for at least the last two years, but the stark jump this quarter can be attributed to COVID-19, and the vulnerability of the tenant base to this pandemic,” said Keegan Kelly, associate economist at Moody’s Analytics.
Vacancy rates also varied by metro area, the report showed. Charleston, SC, reported a 4.9% rise in its vacancy rate, the biggest increase overall. Three other metro areas, however, saw increases of 4% or greater: Canton, OH, Fort Myers, FL, and Indianapolis. Only two smaller metros had a flat or declining vacancy rate: Santa Rosa, CA, and Visalia, CA, which saw declines of 0.3% and 0.2%, respectively. At the same time, Visalia, CA, also has the highest existing vacancy rate of all metros, at 22.7%.