Higher staff wages for some senior housing operators likely are putting a strain on net operating income, according to data collected from the most recent Executive Survey conducted by the National Investment Center for Seniors Housing & Care.
Almost two-thirds (61%) of organizations are now offering rent concessions — a steady increase from one-third reported in Wave 10 (34%), the survey found. In addition to more organizations offering discounts to attract new residents, nine out of 10 respondents reported offering overtime hours (91%), and roughly two-thirds (63%) are tapping agency or temporary staff to mitigate labor shortages (up from 76% and 55%, respectively, in Wave 13).
The latest survey — Wave 14 — included responses collected Oct. 12 to Oct. 25 from owners and executives across 70 senior living communities and skilled nursing facilities.
The growing use of rent concessions may be providing some support to occupancy rates as month-over-month occupancy trends for each of the care segments over the recent waves of the survey are starting to rise. In Wave 14, about one-quarter of organizations with independent living units (27%), about one-third with assisted living units (32%), and roughly one-half with memory care units and/or nursing care beds (48%) noted upward changes in occupancy rates in the past 30 days.
“The latest wave of NIC’s Executive Survey data provides insights into some of the bottom-line pressures being felt by a number of operators,” NIC Senior Principal Lana Peck said. “C-suite respondents to the survey cited growing use of rent concessions to support sales efforts as well as increasing wage pressures associated with a growing reliance on both overtime pay and agency/temp staff that is being hired to help mitigate labor shortages.”