It will come as no surprise that during a week where a senior care facility in Washington state emerged as ground zero for the COVID-19 outbreak in the United States that the virus and its impact abruptly became the dominant topic of conversation at this year's NIC Spring Conference. Despite the concerns, there was a general feeling of confidence that the industry was well-prepared and would weather the crisis, and many companies are moving forward with their 2020 plans, albeit at a slightly more cautious pace. Here are some of the recurring themes that came up in our discussions with industry execs.
Getting Active in Active Adult
Traditional seniors housing companies are seeking to leverage their experience, resources, and name recognition by establishing brands focused on the active adult sector (as our team attending the NMHC Annual Meeting in January discovered, this overlapping market is also attracting significant interest from multifamily companies).[I] There are a few reasons for this, the most obvious being that the ability to ride the "Silver Tsunami" of the Baby Boom generation a decade earlier represents an enormous near-term revenue stream and an opportunity to retain those customers as they transition to their conventional seniors product lines. Another reason that active adult is so appealing is that wage growth is exceeding rent growth in the assisted living sector,[ii] and companies can operate their 55+ properties with considerably less overhead.
Health System Partnerships
As the nation's seniors population simultaneously grows and ages, many operators are facing a bit of a fork in the road: they must either scale-up services to provide care to an increasing number of high-needs residents, or they need to consider shifting their assisted living and skilled nursing focus to less intensive models. As one conference attendee commented, "Several years ago the big news was health systems establishing senior living divisions; today, there are seniors housing companies that are on the verge of becoming health systems." Rather than accepting these two futures as inevitably diverging, a number of companies with whom we met in San Diego are viewing these as parallel paths of opportunity and are exploring collaborative partnerships with health systems, with the health systems' involvement ranging from wellness programming to full-service care management to participating in co-development ventures.
[i] https://www.specialtyconsultants.com/news-insights-Item-Key-Takeaways-from-NMHC-2020
[ii] https://www.nreionline.com/seniors-housing/10-more-takeaways-2020-nic-spring-conference
