Senior Living Investor Interest Swells, as Pandemic’s Worst Days May Be Behind

Senior living transaction volume is picking up in 2022 as investors believe the industry has already seen the worst that the pandemic can offer.

That’s according to the latest Seniors Housing & Care Investor Survey and Trends Outlook from JLL Valuation Advisory. The survey, released Thursday, includes responses from more than 100 investment professionals.

Bryan Lockard, managing director and national co-lead in the seniors housing division of JLL, said he is “seeing positive trends across the board.”


In JLL’s survey, 80% of respondents said they believe the industry has endured the worst of the pandemic, and that market fundamentals will improve this year. That is a stark difference from this time last year, when 48% shared the same sentiment.

“The general consensus is that things will continue to settle down,” Lockard told Senior Housing News.

Senior housing and nursing care transaction volume increased 61% between the first and fourth quarters of 2021, rising to levels last seen at the close of 2019.


Prior to the pandemic and through 2020, both sectors recorded their weakest transaction volume since 2012, according to JLL. Investment volume was down 43% in Q4 2020 compared with the same period in the prior year.

Courtesy of JLL Capital Markets

Driving that growth in volume is increased optimism from investors, who have noted the industry’s progress on occupancy in recent months, operators’ ability to maintain and grow resident rates, and looming demand from aging Americans.

Investors are also seeking to grow outside of traditional real estate sectors with alternative asset classes, including senior housing. At the same time, dry powder for commercial real estate investment activity has reached record highs, landing at $243.7 billion in February 2022, according to JLL.

In terms of what investors were most interested in, the active adult sector took the lead, with 31% of survey respondents identifying it as their most sought-after investment opportunity in 2022. That was followed by assisted living at 28%, independent living also at 17%, with memory care and continuing care retirement communities (CCRCs) at 4%.

Investors are “even more bullish” on nursing care and seniors housing today, JLL found, with 76% of respondents indicating increased exposure in those markets this year.

“I think the only thing the pandemic did was slow growth, Lockard told Senior Housing News. “It’s a blip on the radar – the long-term demand is still going to be there.”

In the early stages of the pandemic, there was a sizable gap between buyers and sellers with both parties refusing to budge. But, that gap appears to be closing, with both buyers and sellers motivated to move their price point to close deals – especially for Class A assets, according to Lockard.

Average senior housing price per unit clocked in at just under $160,000, up 9% from levels seen in 1Q21 but still below the pre-pandemic peak of about $180,000 per unit.

Average senior housing capitalization rates remained stable at 6.4% between the second and fourth quarters of 2021.

Companies featured in this article: