Q: What issues must I address in 2019?
A: Here are three challenging issues that operators will face during the year ahead:
- Operating expenses will increase – Labor costs, employee turnover, staff shortages, increased contract labor, wage competition and general inflation more likely will place increasing pressure on operating profits and cash flow proceeds.
- Property management is becoming more complex – Self-management is a growing challenge. More communities are converting to large, sophisticated, third-party management companies with significant economies of scale and purchasing power.
- Size and scale of many older communities are facing pressure in the marketplace by new communities – These new properties are offering innovative state-of-the-art designs responding to increased consumer preferences.
Opportunities will continue to exist, but challenges and headwinds are increasing for the senior living industry.