11/27/2019
Senior housing demand growth has been under pressure in recent years due largely to demographics. On average, residents move into senior housing properties in their early-to-mid 80s, which means that the industry is currently catering to people born during the Great Depression. As you might expect, the tough economic circumstances during that era led to fewer births, which has acted as a drag on senior housing demand. However, NGM anticipates demographics will switch to a demand tailwind starting in the early-to-mid 2020s as the industry starts to accommodate aging Baby Boomers.
NGM expects occupancy declines to persist through at least 2019, before occupancy growth turns positive in the early 2020s. However, investors should be mindful that supply can easily ramp back up, and is likely to do so as demand growth accelerates.
