Granger Cobb, president and CEO of Emeritus (NYSE:ESC) says that assisted living is about to turn the corner.
Sitting down with National Real Estate Investor, Cobb says that while it expects the sector to turn around, it’s being cautious.
I’m absolutely convinced that it is only a matter of time before we see occupancies and rental rates improve. The demographic of older people continues to expand and there’s little new supply of assisted living buildings. Occupancy has slowly started to improve. But rental rates are only averaging increases of 1 percent to 2 percent a year. That’s pretty anemic. We’re approaching 2012 very conservatively, and we’re watching expenses. We don’t expect great increases in occupancy and we believe there will be continued pressure on rental rates.
Recent data from the National Investment Center for the Seniors Housing & Care Industry (NIC) showed that assisted living didn’t see as much of a drop as sectors such as independent living, which NIC feels is as a result of it not being as “needs driven”.
Written by John Yedinak