Construction and renovations of senior living/multifamily communities in the Southeastern United States are just starting to boom! The short supply and high demand makes it a great time to invest. The demand for senior communities has never been higher.
In last week’s blog we talked about the low supply in the senior multifamily housing and with the aging Baby Boomers (the largest Demographic in the United States) the demand will be high.
Investment that is Unaffected by Recession
While senior living communities have their own business cycle, their properties are not as affected by the economy, employment rate, or market trends. The need for health care for our aging population and long term medical communities, will still be in high demand.
In fact, today’s senior housing has come a long way in the last decade. They are now integrated into master planned communities, complete with medical providers, boutiques, upscale designs, and dining areas, salons, cafes, and fitness center to encourage socialization and better overall health.
According to the National Council of Real Estate Investment Fiduciaries (NCREIF), “Looking more closely at the components of total returns, appreciation returns for seniors housing exceeded all major property types on a 10-year basis. Hotel and office both experienced negative capital returns over this period, while seniors housing had a 3.73% capital return. More recently, the capital return was 6.94% on a one-year basis, dwarfing all other property types except for industrial, which has benefited from e-commerce which has increased demand for last-mile warehouse space. With the exception of the hotel sector, seniors housing income returns have also exceeded the NPI as well as the other main property types on both a one-year and a ten-year basis.”
Construction and renovations of senior housing is a great investment, it is just as important to partner with an experienced construction group, who understands the industry and today’s market.
With over 66 years of combined experience and over 42,000 completed units, you can feel confident SWET Construction Group. Our experienced team, advanced knowledge of construction, high quality products, on-site management, turn-key solutions and precise estimation, will deliver the results you’re looking for on budget and on time.