Despite a slower start in 2023, the senior living industry is expected to bounce back in 2024 and regain pre-pandemic occupancy levels. However, many challenges from the pandemic era still persist. These include difficulties in growing due to tough new development, high expenses, staffing shortages, and the perceptions of prospective customers. Senior living companies are also evolving and expanding into new product types, with investments and decision making today potentially shaping the industry in the years to come.
In 2023, Michael Levine, Senior Managing Director of Real Estate at Greystar, highlighted the explosive potential of the active adult trend in the U.S. Greystar plans to significantly grow its presence in this sector, with expansions into new states and partnerships with developers like Avenue Development for innovative senior housing projects. Others in the active adult sector include Liv Communities, GSI, Chapters Living, and Grace Management. The sector is expected to remain red-hot in 2024, driving further growth and development.
Shankh Mitra, CEO of Welltower, believes that “good enough” results are no longer sufficient for the senior living industry. He advocates for a complete business process reengineering and a new customer journey for the post-Covid era, emphasizing the need for a fresh and common-sense approach. Welltower’s collaboration with operating partner Cogir in Canada is a testament to this new way of thinking, aiming to create a new blueprint for owner-operator alignment for the future.
Matt Derrick, Development Managing Director at Confluent Development, acknowledged the economic challenges that have affected senior living development, likening the current era to the aftermath of the Great Recession. Despite the obstacles, developers are preparing for potential opportunities in the near future when conditions improve.
Jon DeLuca, CEO of Senior Lifestyle, sees huge opportunities in 2024 for expanding through acquisitions, leveraging billions of dollars in debt maturity and the changing hands of struggling communities. Companies with deep pockets, such as private equity and REITs, stand to gain, and operators like Senior Lifestyle are looking to align themselves with established partners for fast growth.
Steve Lindsey, CEO of Garden Spot Communities, predicts that the era of single-site and small-system organizations in senior living is coming to a close. He believes that small organizations will face increasing challenges and that consolidation and partnerships will be crucial for navigating the future of the industry.
In the midst of challenges, there are also opportunities for growth and evolution in the senior living industry. As companies prepare for 2024, they are adapting to new trends and developments to shape the future of senior living.
