Sherman & Roylance Senior Living is committed to staying at the forefront of the senior housing industry, and our agents regularly attend conferences to gather valuable insights. Recently, our very own Jack Osteen had the privilege of attending the Interface Seniors Housing Southeast conference, where industry leaders convened to discuss the state of senior housing. In this blog, we'll delve into the key takeaways and expert insights that Jack brought back from the conference. Join us as we explore the trends, challenges, and opportunities that are shaping the future of senior housing.
Survive to 25: Weathering the Storm
One resounding message from the conference was "Survive to 25." This phrase encapsulates the prevailing sentiment that the senior housing industry is expected to face continued challenges for another 12-18 months. In 2021, the industry witnessed growth and occupancy, but this was followed by a focus on rates in 2022. As we move into 2023, margins are getting squeezed. However, there is optimism that 2024 may bring a more natural balance to all these factors, leading to some much-needed stabilization.
Embracing Technology: Paving the Way Forward
A prominent theme at the conference was the critical role of technology in shaping the industry's future. Senior housing providers who can innovate and adapt to technological advancements are poised to lead the way. Moreover, this includes solutions that enhance resident experiences, improve operational efficiency, and support healthcare delivery.
The need for more middle-market senior housing properties that are affordable was a hot topic. As the aging population grows, there's a clear demand for housing options that cater to a wider range of budgets. Meeting this need presents a significant opportunity for our industry to bridge the affordability gap.
With occupancy rates between 60-80%, securing financing has become increasingly challenging. However, this underscores the importance of carefully considering occupancy rates in senior housing deals.
Seizing Value-Add Opportunities
Despite industry challenges, value-add opportunities and all-cash buyers remain prevalent. This suggests that investors are optimistic about the long-term potential of senior housing.
Influence of the Office Market
One panelist noted that the office market may be affecting our industry, but it's not in dire straits. This observation emphasizes the interconnectedness of various sectors in the real estate market.
Debt Market Dynamics and Transactional Activity
The conference highlighted the linkage between senior housing transactions and the debt markets. An uptick in transactional activity is expected to follow improvements in the debt market.
Affordability for Baby Boomers: Top Senior Housing Trend
As the baby boomer generation ages, affordability concerns arise. Can they sustain the cost of senior living, which may reach $7000 per month? Addressing affordability is becoming increasingly important as seniors grapple with rising expenses.
Margin Pressures and Cost Management
Rising expenses, including insurance premiums, are causing margin pressures across the industry. To maintain profitability, senior housing providers must find creative ways to manage costs while delivering high-quality care.
Navigating the Future with Insight
The Interface Seniors Housing Southeast conference provided invaluable insights into the current state and future prospects of the senior housing industry. Jack's experience at the conference underscores our commitment to staying informed and adaptive. As we navigate the complexities of senior housing, Sherman & Roylance Senior Living remains dedicated to supporting buyers, sellers, and investors.