50pc of senior living executives expect margins to increase

LONDON: Operators across the senior living spectrum are reporting better margins with nearly half, 49% of respondents, reporting that they expect margins to increase in the next six months, though skilled nursing facilities (SNFs) saw the slowest acceleration in move-ins in the past 30 days.

While 31% of respondents anticipate an increase between 1 and 5% in their margins, one-quarter expect a decrease between 1 and 5%.

That’s according to the National Investment Center for Seniors Housing & Care’s (NIC) most recent survey of skilled nursing and senior living executives, now in its 33rd iteration since the COVID-19 pandemic began.

Also of note, the share of organizations offering rent concessions has not varied since last summer as more than half, 51%, said they were offering rent concessions to attract new residents. However, fewer reported offering rent discounts than in previous surveys.

“Roughly 50% of respondents with senior living residences report that the pace of move-ins accelerated in the past 30-days — a notable increase from the prior survey.,” NIC senior principal Lana Peck observed in the report. “Increased resident demand was the primary reason for acceleration in move-ins.”

Organizations with residents waiting to move in was nearly 35% in November 2020, and has begun to improve since Sept. 6, with roughly 50% of respondents with independent living, assisted living and/or memory care units reporting the pace of move-ins accelerated in the past 30-days. For nursing care that percentage was smaller, at 37%, up slightly from 31% in the previous survey.

Increased resident demand was considered the primary reason for the acceleration as the spread of the COVID-19 delta variant has begun to slow in many parts of the country.

The NIC data comes from leaders at 67 small, medium and large seniors housing and skilled nursing operators from across the country, collected from Sept. 7 to Oct. 3. Owner/operators with one to 10 properties comprised half of the sample with 26% operating nursing care properties.

While some had predicted SNF occupancy recovery by the end of the year, 73% of respondents now expect their organization’s occupancy to return to pre-pandemic levels sometime in 2022, matching expectations shared by American Health Care Association’s President and CEO Mark Parkinson.

“We’re not going to be totally recovered by the end of 2021,” he said. “It’s going to take another year. The pause in census recovery combined with increased staffing costs have been devastating.”

Still, 73% of respondents expecting occupancy recovery in 2022 is an improvement compared to the March 22 to April 4 NIC survey when only 57% expected it.

About 40% of organizations with nursing care beds saw an increase in occupancy, up from the previous survey, but still significantly below summer surveys.