Stabilized Senior Housing Occupancy Falls to 88.7% in April

The coronavirus pandemic sent occupancy rates for senior housing and skilled nursing communities on a downward trajectory in April, according to a new intra-quarterly report released Tuesday by the National Investment Center for Seniors Housing & Care (NIC).

Senior housing stabilized occupancy among NIC’s 31 primary markets dropped 110 basis points to 88.7% — the first full month of the pandemic in the U.S. NIC defines stabilized occupancy as the occupancy rate of properties that are at least two years old, or if less than two years old, have achieved occupancy of at least 95% since their opening.

NIC released the report in order to provide added transparency during the pandemic, as well as give owners, providers and other stakeholders updated data that can be used to form solutions that will residents and caregivers safe, NIC President and CEO Brian Jurutka said in a statement.

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The occupancy pressures were more acute for skilled nursing. Stabilized occupancy among the care type dropped 220 basis points in the quarter, to 84.7%.

“Some of the sharp decline in skilled nursing occupancy is likely driven by fewer hospitals discharging patients to post-acute care settings for rehabilitative therapy as hospitals defer elective surgeries due to the pandemic,” stated NIC Chief Economist Beth Burnham Mace.

The report confirms coronavirus-related occupancy pressures that are being felt by publicly traded senior housing operators and health care real estate investment trusts (REITs) resulting from a lack of move-ins as communities across the country are secured to non-essential personnel.

Brookdale Senior Living (NYSE: BKD) saw its senior housing occupancy decline 220 basis points last month, to 80%. Notably, move-ins fell nearly 35% across its same-community portfolio as the country went into lockdown in March.

For Welltower (NYSE: WELL), the largest health care REIT, occupancy across its senior housing operating portfolio dropped 70 basis points in March and another 240 basis points in April, to 82.7%. Chief Financial Officer and Executive Vice President Tim McHugh projects another 500 to 600 basis point drop in occupancy throughout the second quarter of 2020.
Occupancy among Five Star Senior Living’s (Nasdaq: FVE) owned and leased communities fell 1.6% to 81.3% in the first quarter, while in managed communities occupancy decreased 1.1% in the quarter, to 82.9%. But new leads declined by 50%.

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