Construction weakens in skilled nursing segment, report says
Builders continue to scale back construction of skilled nursing care facilities, buoying occupancy rates, according to a new report from Marcus & Millichap Real Estate Investment Services.A total of 2,600 beds are under construction, nearly 1,000 less compared with one year ago, the SeniorsHousing Research Report said. Meanwhile, as of mid-2007, occupancy in the skilled nursing segment registered at 94%, which is similar to a year ago. The average acquisition cost to an existing facility is generally less than the average cost to build today, said the report, which was issued in conjunction with the NIC MAP Data Analysis Service.
Meanwhile, development in the assisted living sector also has slowed. Only 3,180 units are under construction, the lowest number of units in the past three years. Despite the slowdown, the occupancy rate has decreased to 95.5% over the past year due to a modest decline in demand.