We frequently receive questions about the relationships between demographic trends and seniors housing demand at NIC and this commentary briefly addresses the topic. The chart below depicts the annual growth rates of three U.S. population age cohorts—(1) persons aged 75 - 81, (2) persons aged 82 – 86 and (3) persons aged 87 plus for the period beginning in 2012 and ending in 2030. The chart uses data from the U.S. Census Bureau’s 2012 Middle Series projections for the growth rates of these three cohorts.
1 Institutional investment interest in seniors housing and care is strong and growing. In the first quarter of 2015, transaction volume totaled $19.4 billion on a four-quarter moving average, with more than 122 deals closing. Investor interest can be traced to many factors. Foremost among these factors is its investment track record: both appreciation and income returns for seniors housing have consistently dwarfed other property type returns for more than ten years. On a ten-year basis, total returns as reported by NCREIF were more than 14.1%; this compares with all property types of 8.4%.