Construction activity in assisted living properties continues to accelerate. Construction has steadily risen since 2010, and represented 5.2 percent of existing supply as of the third quarter of 2013. As a point of comparison, in the last market cycle, assisted living construction peaked just shy of 4 percent of existing supply.
While on its face, aggregate construction activity appears high, a sizeable share of construction is limited to certain metropolitan markets. Six metropolitan markets (Houston, Minneapolis, Phoenix, Chicago, Boston and Denver) represented 50 percent of all assisted living construction activity within the top 31 metropolitan markets. Houston and Minneapolis alone each had more than 1,000 units under construction as of the third quarter of 2013.