Spokane-area retirement homes see occupancy rise
Occupancy rates climbing in part due to improving housing market, some sayOctober 11th, 2012
Some Spokane-area retirement center operators say occupancies are on the rise and that moving activity within their centers, such as from independent-living to assisted-living units, also has picked up this year.
While some describe the activity as anomalous or situational, others say the activity is indicative of an improving real estate market.
Alan Curryer, president and CEO of Rockwood Retirement Communities, says, "We've seen a definite uptick in occupancy over the past 18 months."
Rockwood Retirement Communities, operated by Spokane United Methodist Homes, includes Rockwood South Hill, a 329-unit complex at 2503 E. 29th, and Rockwood at Hawthorne, which has 84 living units at 101 E. Hawthorne, on Spokane's North Side.
Curryer estimates that those two centers collectively now have an occupancy rate in the mid-90 percent range. At the depth of the recession, in 2009 and 2010, that rate was "a bit shy of" 90 percent, he says.
At Rockwood South, he says, every unit in Rockwood Forest Estates, the independent-living neighborhood, currently is spoken for, with some being remodeled to accommodate residents who have bought them.
Curryer adds, "I think it's a nationwide trend."
The National Investment Center for the Seniors Housing and Care Industry, an Annapolis, Md.-based organization that tracks more than 12,500 retirement properties throughout the U.S., says the national occupancy rate for independent-living and assisting-living units ticked up to 88.6 percent in the second quarter of this year, compared with 88.3 percent in the first quarter and 87.7 percent in the second quarter 2011.
The organization says that the occupancy rate has risen during the past nine quarters from a low of 87 percent in the first quarter of 2010.
Nationally, trends involving skilled-nursing units show a different trend, with the occupancy rate ratcheting down slightly to 87.9 percent in the second quarter, compared with 88.2 percent the previous quarter. The National Investment Center said this continues a decline that has been under way for several years.
Third-quarter numbers weren't available at press time.
At Riverview Retirement Community, a 298-unit complex at 1801 E. Upriver in East Spokane, the level of activity has been unprecedented, says Christie Hoffman, Riverview's director of community relations. The retirement center saw a mass migration from its independent-living facilities into its assisted-living facility. In January and February, 12 of the center's independent-living homes were vacant, which is substantially higher than usual.
"Our original homes were built in 1985, and we had people living in them into their 90s," Hoffman says. "It was a natural progression. It just hit that way."
While worrisome at the time, Hoffman says Riverview saw a flurry of activity in late March and early April, as some signs that the housing market was turning around came to light. Five new residents moved into the retirement complex during May, and four independent-living homes there are being remodeled for people who plan to move in during the next month and a half, she says, adding that three homes remain available.
"It was a very dramatic year here," she says. "It's been kind of an amazing race."
William Patrick O'Neill, president and CEO at Riverview, says the assisted-living portion of the complex has had consistent occupancy for the last two years and is at fully capacity currently. The skilled-nursing portion is at about 90 percent occupancy, which is lower than the typical 95 percent occupancy rate, but the center is purposefully keeping some units empty so that it can move tenants around as it progresses with an interior renovation there.
Concerning assisted living and skilled nursing, O'Neill says, "It's not as tied to the economy." Rather, he says, it's based more on need and competitive factors within the industry, such as price, location, and management.
Like Riverview, Harbor Crest Senior Living Community had more turnover than usual earlier this year, says Erika Halverson, director of marketing for the 160-unit complex, located at 3117 E. Chaser Lane on the South Hill.
Harbor Crest has 16 independent-living homes and cottages, and seven of them came available earlier this year, either because residents moved to the complex's main building or because they died. Halverson says the center was able to fill all of those units.
The facility's main building is between 93 percent and 94 percent full currently, Halverson says, up slightly from a year ago when the occupancy rate was lower in the 90 percent range.
She says improve-ments in the economy have helped.
"We are seeing an increased confidence level from seniors, and that has affected our census positively," Halverson says.
Statistics from the Spokane Association of Realtors' Multiple Listing Service gird the retirement center's assertion that an improving home market is helping the senior-living industry.
Rob Higgins, executive vice president of the Realtors' association, says that as of the end of September, home sales activity has increased 9.8 percent compared with the year-earlier period. In the same period, the average sales price is up 3.6 percent, to $175,025 from $168,961, and the median sales price is up 3.2 percent, to $159,000 from $155,000. Meantime, the inventory of homes listed through the MLS was down 10 percent at the end of September compared with a year earlier, boding well for those hoping to sell a home.
If these increases are sustained through the end of 2012, it will be the first time in five years that activity increased and inventory decreased.
"Personally," Higgins says, "I think we bottomed out in 2011 and now start a gradual climb."
Spokane-area sales activity and home values remain well below those reported in the mid-2000s, but retirement executives here say seniors are no longer waiting for those values to return.
Rockwood's Curryer says, "People are accepting the fact that their homes aren't worth what they once were, and they're moving on with their lives."
Similarly, Riverview's O'Neill says, "If people are waiting to sell their homes until values come back, it's not going to happen for a long time. They're making decisions now."
The National Investment Center for the Senior Housing and Care Industry also reported that the annual inventory growth rate for senior-housing units was 1.3 percent for the second quarter, up slightly from 1.2 percent in the first quarter and from 1.1 percent in the year-earlier quarter. The organization said current construction as a share of existing inventory remained flat at 2.1 percent.
Chuck Harry, director of research and analysis for the organization, said in a press release, "This stabilization in construction activity hints that we may be at the beginning of a new phase in the development cycle."