Several factors are driving the purchases, led by an improving economy and lower costs of capital. Real estate fundamentals in the industry are also stabilizing, with the average occupancy rate remaining at 87.6% during the fourth quarter of 2010 according to the National Investment Center for Seniors Housing & Care Industry.
Investors anticipate growing demand for seniors housing as the population of older people soars. Also, new construction has been constrained because financing is scarce. “Seniors housing has great market fundamentals,” said Ray Lewis, president of Chicago-based Ventas Inc. (NYSE:VTR) during an interview with the publication.