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Tag: Development & Financing

The Middle-Market Gap in Senior Housing: Challenges & Opportunities

At its recent regional conference, the National Investment Center for the Seniors Housing and Care Industries hosted a panel presentation, moderated by Bill Pettit of Merrill Gardens, that included Michael Best of Cardinal Court Capital, Ben Klein of Platinum Healthcare, and myself. The panel started with slides that laid out the magnitude of the challenge: 33 percent of the 75+...

Out-of-Pocket Health Care Spending in the Last Five Years of Life

Although a key objective of Medicare is protecting the elderly from financial risk, little research has examined the financial impact of out-of-pocket health care expenditures faced by older adults, particularly near the end of life. A recent study in the Journal of General Internal Medicine looks at the out-of-pocket health care expenditures over the last five years of their lives of...

Municipal Bonds as Part of the Mid-Market Senior Housing Solution?

Summary: The cost and availability of debt plays a meaningful role in a developer’s ability to deliver a moderately priced, mid-market senior housing community. Tax-exempt municipal bonds have been suggested as a means of reducing debt service on development projects. This post provides the basics of using tax-exempt bonds for development, thanks to James Scribner of Red Capital....

Geoffrey Dohrmann, President of Institutional Real Estate Inc., Weighs In on Affordable Private Pay Senior Housing

Summary: The president of Institutional Real Estate Inc. (IREI) weighed in with his reaction to the previous post on how middle- and low-middle income seniors need financial assistance to pay for housing and care. The affordable private pay problem is a problem for a reason—it has many facets that will require creativity to address. A mindset that considers only a real estate...

Occupancy Rates & Pricing Strategy by Quartile – Independent Living

Summary: First quartile independent living (IL) properties (those with the lowest average monthly rent) maintained higher levels of occupancy than fourth quartile properties (those with the highest rent) through the global financial crisis. First quartile IL properties were less aggressive in raising rents, evidently using price as a tool to stay full. Data: Occupancy rates in first...

Middle/Low-Middle Income Seniors Need Financial Assistance to Pay for Housing and Care

Summary: The senior housing industry risks alienating a large part of its potential market. The median price of assisted living and independent living in the 31 largest MSAs already outstrips the incomes of seniors in the middle and low-middle categories. These seniors need financial assistance to afford these median monthly fees. Data: Seniors in the $20,000 to $40,000 income range...

The Senior Housing Industry Needs More Affordable Private Pay Options

Summary: The senior housing industry needs more private pay properties that are within reach of the middle/low-middle income segment. I want to start a conversation on how to fill this need, and hope you will add your thoughts. Current Situation: The senior housing industry does a good job providing care and housing for the wealthy in high-end, luxury communities of all types i.e.,...

Methods for Valuing Entry-Fee CCRCs

In an excellent analysis and summary of major issues that impact the valuation of continuing care retirement communities (CCRCs), Alan Plush, the senior partner of HealthTrust LLC, explains the necessity of recognizing that a CCRC “has many moving parts.” In other words, it is more complex than traditional rental seniors housing because it includes disparate operational platforms...

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