More than two-thirds of 65-year-olds will need assistance to deal with a loss in functioning at some point during their remaining years of life.
According to
the U.S. Congressional Budget Office, “By 2050, one-fifth of the total U.S.
population will be elderly (that is, 65 or older), up from 12 percent in 2000
and 8 percent in 1950. The number of people age 85 or older will grow the
fastest over the next few decades, constituting 4 percent of the population by
2050, or 10 times its share in 1950. That growth in the elderly population will
bring a corresponding surge in the number of elderly people with functional and
cognitive limitations. Functional limitations are physical problems that limit
a person’s ability to perform routine daily activities, such as eating,
bathing, dressing, paying bills, and preparing meals. Cognitive limitations are
losses in mental acuity that may also restrict a person’s ability to perform
such activities. On average, about one-third of people age 65 or older report
functional limitations of one kind or another; and among people age 85 or
older, about two-thirds report functional limitations. One study estimates that
more than two-thirds of 65-year-olds will need assistance to deal with a loss
in functioning at some point during their remaining years of life. If those
rates of prevalence continue, the number of elderly people with functional or
cognitive limitations, and thus the need for assistance, will increase sharply
in coming decades.” [12] The Company’s new
and amenity-rich facilities will meet these growing needs while providing peace
of mind for both residents and their loved ones.
[12] Congressional Budget Office. “Rising Demand for
Long-Term Services and Supports for Elderly People.” June 2013. Source: http://www.cbo.gov/sites/default/files/cbofiles/attachments/44363-LTC.pdf
UPDATE June 2015
Findings from the CBRE's 2014 Cap Rate Survey reveal that seniors housing is still a potentially lucrative investment for tenured operators looking to grow, as well as opportunistic developers seeking diversification from typical multifamily projects. While construction activity is currently in a high growth expansion phase in certain markets, the total supply is still not enough to meet projected demand for units. According to the survey's findings, current supply will have to increase by approximately 150% to meet demand in 2044, with a substantial shortage in 2024. CBRE reports around 40,000 senior living dwellings must be added each year to meet demand. For comparison, the current construction rate of senior living units is about 16,000 units each year.
