Senior housing providers saw the Great Recession transform their business — from one that welcomes customers who want what they offer, to relying more on customers who need it.
That’s because the real estate slump kept millions of aging Americans unable to trade their homes in for retirement ease — until a medical scare or sudden disability forced them to move.
Which led to a higher proportion of new senior living residents needing more assistance and care than was typical before the crash.
“More and more, the reason they come is some kind of health event,” said Bob Anderson, CEO of Seattle’s Horizon House, which offers options ranging from independent to assisted living. “People have postponed their decision to move into senior home communities, so when they come there’s greater urgency.”
That’s just one way in which the downturn transformed the industry. For senior housing chains, the changes hastened consolidation and a hunt for new sources of financing. Thus, Seattle-based Merrill Gardens LLC entered into an $817 million partnership last year with Health Care REIT, around the same time Seattle-based Emeritus Senior Living paid $310 million to buy out a joint venture partner.
Such deals sent the national dollar volume of senior housing acquisitions (including skilled nursing) up by 40 percent in 2011 from the previous year, to $16 billion, according to industry journal Senior Living Executive.
Of course, the components of the senior living industry do not move in unison. No part of the industry suffered more than the independent-living end of the senior housing spectrum — think retirement complexes around golf courses — which felt a multiyear drop in sales and occupancy but is starting to climb back.
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