Are We Overbuilding Senior Housing?
Overbuilding can pose a major problem in retail and multifamily, but what about senior housing? Senior living execs at our event last Wednesday shared their thoughts on why they're not losing any sleep over a supposed senior housing bubble. (Don't miss what else these experts said.)
The senior housing market supply is high, but that's not necessarily a bad thing, Capital Senior Living SVP Carey Hendrickson said. Between North Texas' surging population and the growing number of senior citizens coming to senior housing, overbuilding is next to impossible.
Plus, competition isn't as fierce. Unlike retailers that have to take e-commerce and multiple store locations into account, senior residences only compete with other housing options within 10 miles or so of their own site,Prevarian Senior Living managing principal Allan Brown (above, right with business partner Dodd Crutcher) says. Overbuilding might become a problem in rural areas or suburbs in less lively metroplexes, but Dallas-Fort Worth shouldn't worry.
Demand for higher-end (or at least newer) properties (like Edgemere, pictured above) remains strong. Though older and newer properties both fill important roles in the senior housing market, new communities aren't competing with older properties. New properties attract different residents and buyers than older ones, Drever Capital Management director of acquisitions Max Gonzales says.
These execs agree that paying attention to the other sites around your location is far more important than trying to follow national demand.