The CBRE Summer 2018 Seniors Housing & Care Investor Survey was sent to the most influential seniors housing investors, developers, lenders and brokers throughout the United States. Key observations include:
- Investor interest in seniors housing remains very strong, with nearly two-thirds of survey respondents expecting to increase the size of their portfolios over the next 12 months.
- Investors appear most interested in the lifestyle focused segments of seniors housing. Independent living was identified as the best investment opportunity, followed by assisted living. The active-adult segment also is attracting considerable interest.
- The top concern of investors was property-level operating costs, followed by construction activity (supply/demand imbalance) and rising interest rates.
- Cap rates rose in nearly all categories, reversing a trend from prior surveys. Greater increases came in Class B and C product, in memory care and in non-core assets. Cap rate pricing held up best for Class A, core and independent living.
- Cap rate spreads between investment classes reflected greater interest in Class A and less distinction between Class B and C assets. Spreads between Class A and B increased, while spreads between Class B and C decreased with a few exceptions.
- Market participants are experiencing increased marketing time, indicating increased buyer and seller disconnect.