The biggest threats to nonprofit senior living providers, by far, are the regulatory environment and reimbursement changes, and then operating costs and for-profit competition. That’s according to senior living leaders from 23 nonprofit organizations who completed the annual ZGES Survey of Industry Trends while attending this year’s Ziegler Greystone Executive Symposium. Among the 23 participants were 14 single-site organizations and one that has not developed a community yet.
Seventy-eight of survey respondents said that for-profit investment in their markets has increased from last year, whereas 22% said it had remained the same.
Fifty-five percent of respondents said their outlook on the economy has not changed from last year, and 41% said that they are more optimistic. Seventy-four percent said they view the real estate market as strong, and an additional 10% see it as excellent.
More leaders said they are scaling back sales incentives this year as compared with last year. This year, 27% said they have scaled back, whereas last year, 10% said they were. Fifty-nine percent of respondents said they are continuing with existing sales incentives, however.
Providers are more concerned about occupancy in assisted living and memory care than they are about occupancy in independent living.
Ninety-one percent of respondents said they are planning a redevelopment or expansion. Eighty-three percent said they are considering several growth initiatives. Seventy percent said they are looking to expand at an existing campus in the next three years, 44% said they are looking at new development during that time, and forty-four percent said they want to redevelop an existing community. Fifty-two percent said they are actively planning for new opportunities and that their boards are ready for them, whereas 35% said they are focusing on existing campuses.
Access to quality sites and the requirements of capital markets were the most commonly cited constraints to investment, followed by securing staff time or pre-finance funding.
Seventy-eight percent of respondents said they anticipate a leadership change in the next 10 years, but 57% of respondents said they do not have succession plans in place.