U.S. Senior Housing Opportunity

Summer 2008 Vol 33, No. 2

Abstract: The senior housing sector is emerging as an increasingly attractive investment opportunity. Facilitated by a restrained supply pipeline over the past six years, occupancy levels for senior housing assets rebounded from lows recorded in 2001-2002 to near 90 percent today in many metro areas. Operating business models are better-defined, contributing to strong revenue growth and higher profit margins. Since the senior housing market is driven by surging senior population and not directly related to external economic factors such as economic growth and the unemployment rate, the addition of senior housing assets to a portfolio could increase diversification and lower market risk. Different investment strategies are outlined and discussed.