Investors Look to Senior Housing Projects as Key Demographic Ages

As the average age of the country’s population rises, the demand for adjusted living arrangements directed toward the population over the age of 65 continues to grow. Seeing promising returns in the multifamily market, retail investment firms have begun to jump at the opportunity to develop and reinvigorate multifamily residential complexes and senior assisted living facilities.

The Department of Health and Human Services has anticipated that by the year 2030, over 19% of the population in the United States will be comprised of people over the age of 65. This figure represents a 6% increase from their data collected in 2009.  From an investment standpoint, this fact presents an opportunity in the increased demand for senior living facilities such as multifamily residential complexes and assisted living facilities.

Although, historically investors have been fragmented, recent consolidation within the senior living industry has led to a more capable and efficient group of operating and management firms. Advisors reveal that this factor will continue to make the market more attractive to investors and consumers alike, yielding continued high returns in the future. Though the majority of the investments in this early stage are focused primarily on multifamily and assisted living facilities, experts reveal that even nursing homes—extensively high in operational costs—have become more attractive because of the potential for higher earnings in the next twenty years.

As the population continues to age, capital investment into various areas of real estate should be encouraged based on the high potential for return. For more information on residential and commercial real estate trends, please visit our Real Projectives blog.