Senior housing occupancy rates dropped slightly in Q1, and experts have attributed the decline to an influx of new supply that hit the market this year.

Overall occupancy rates declined more than half a percent from last year’s levels to 89.3%, according to the National Investment Center for Seniors Housing & Care. Annual rent growth slowed 0.4% during the same period to 3.3%.

The cooling of the sector had little to do with declining demand, especially since baby boomers continue to age. As of 2017, the former largest generation in the world is between the ages of 52 and 70, according to Pew Research. Fannie Mae Economic Manager Tim Komosa told CoStar senior housing absorption levels are healthy and attributed the slight decline to the high levels of new supply hitting the industry.

CoStar said high supply levels are likely to be an ongoing feature of the senior housing market for some time, even though the number of new units under construction fell 4.7% from a year ago to 33,641 over the quarter.

Investors are diving into the senior housing sector as baby boomers age. CBRE’s recent U.S. Senior Housing & Care Investor Survey said nearly 60% of respondents plan to increase their senior housing portfolios this year, up from 47% last year, and more investors are becoming interested in value-add opportunities as the sector evolves.