The senior housing sector is poised to recover over the next 12 to 18 months, said Aaron Will, vice chairman and co-head of capital markets for CBRE’s national senior housing practice. In fact, he said, “It’s going to perform better than other properties and be a more attractive kid.”
“We are now at a tipping point where business operations are starting to show great promise,” Will said in a video produced by the commercial real estate services and investment firm.
He predicted that the market “will be very active over the next 18 to 24 months and will be essential for our sector.”
However, it may not all be good news.
“Frankly, there’s a lot of pent-up activity that needs to be cleared up, whether people like it or not. So I’m hopeful that there will be a lot of activity in our field,” Will said. he said. “We expect to see a large number of asset sales and lease-ups that are not at the valuation that people were expecting.”
What’s more, Will says the sector is still recovering from the summer of 2022, when rising interest rates “upended capital markets.”
But Will predicted that senior housing sales and finance will be a “gangbuster” over the next 12 to 18 months.
“Over the next 12 to 18 months, given where prices are now for really, really good properties, we will see a re-emergence of core-plus capital in this space and a relative value strategy for seniors housing. “Deaf,” he said.
She noted that active adult, independent living, assisted living and memory care occupancy rates are increasing.
“I have a lot of confidence in this. Given recession resiliency, given the need-driven factors around senior housing, this property outperforms the rest, and the COVID-19 era is less so. The rest of commercial real estate will be more macro-driven,” Will said.
Following Will’s forecast, the third quarter NIC MAP Market Fundamentals Report was released by the National Senior Housing and Care Investment Center on Thursday. It predicts that the elderly occupancy rate could return to pre-pandemic levels in 2024.