Economic indicators may not be sexy, but they are essential bellwethers when it comes to monitoring the seniors housing sector, according to Beth Mace, chief economist and director of capital market research at the National Investment Center on Seniors Housing & Care. “Unemployment, housing starts, the stock market—things that contribute to wealth—are what I watch when considering the future of the seniors housing sector,” she says.
Pointing to a very strong job market, low unemployment and high consumer confidence levels, Mace asserts that the economy is “definitely moving forward with beneficial signs for demand for the sector.”
Indeed, a bullish stock market bodes well for one’s 401(k) balance, while low mortgage interest rates can help someone sell a home faster. Both of these factors are important to a retiree who wants to move into a senior living village or continuing care retirement community (CCRC) that requires a real estate purchase.
|Gardening is an element of the Circle of Friends program at Belmont Village. Photo courtesy of Belmont Village.|
The proof is in the pudding: the current average occupancy rate for seniors housing is 90.1 percent (as of the fourth quarter 2015), according to NIC. Specifically, the average occupancy rate for independent living properties is 91.4 percent, while assisted living occupancy is at 88.4 percent.
While senior living operators have little control over unemployment and interest rates, there are some on-the-ground factors that also account for why some providers enjoy high occupancy levels. Long-Term Living sat down with some operators to find out what’s in their secret sauce when it comes to attracting—and keeping—occupants.
Location, location, location
Many senior living operators with above-average occupancy rates say their community is well located, either due to its placement within an urban area, being near or adjacent to an institution of higher learning, or serving as a “destination” location.
For Kendal at Lexington, in Lexington, Va., the latter has much to do with why its occupancy rate has held steady at 93 percent for several quarters. “We have a wonderful location, just outside of the small town,” says Mina Tepper, Kendal at Lexington’s executive director. She notes that while the town is “very tiny” it does have two historic universities: Virginia Military Institute and Washington and Lee University. “Those two longstanding historical educational facilities make a big difference in terms of its attraction to residents,” says Tepper. “At the same time, we also have a wonderful rural campus with rolling hills and walking paths.”
In fact, nearly all of Kendal’s CCRCs are strategically located near a college or university. A prime example of attractive location is Kendal at Hanover in Hanover, N.H., which is a stone’s throw from Dartmouth University. In addition to its affiliation with the Ivy League school, the community’s proximity to the Upper Valley area of New England is also a big selling point, says Jeff Roosevelt, director of public relations and marketing.
With an occupancy rate of 96 percent, Roosevelt notes that he does advertise in several local monthly publications in area, including the Dartmouth alumni magazine.
Amenities and services
With an average occupancy rate among its 24 communities of 94 percent, Houston, Texas-based Belmont Village Senior Living believes it is lucky to have many of its communities in markets where there are high barriers for competitors to enter, says Carlene Motto, Belmont’s chief marketing officer. But that’s not what differentiates them, she adds. “I believe that our success is due to hiring and retaining the best-in-class people and delivering exceptional services from a care standpoint,” she says.
|Couples with varying needs can stay together at Belmont Village because the entire building can accommodate changing care levels. Photo courtesy of Belmont Village.|
One example of those services is its Circle of Friends program for residents with mild cognitive impairment. Originated by Belmont, the program was created in consultation with experts from Vanderbilt University, University of California–Los Angeles and the University of Southern California. It serves as a strong selling point for residents, Motto says. “What’s nice about the program is that it was designed so that couples can still live together while one is in Circle of Friends,” she says.
Another service-oriented aspect of Belmont is its commitment to maintaining 24-hour nurse staffing and 24-hour medication administration at all of its communities. “Family members and residents want beautiful surroundings that make them feel at home—and that’s important—but what’s most important to families is peace of mind and that you have people who have passion for taking care of seniors,” Motto says.