Phase 3 - Advanced (more than one main point to the post, ebooks)

Podcast - Is There Opportunity 
In Senior Housing?

Marcia Cuenca
August 23, 2022
Podcast - Is There Opportunity 
In Senior Housing?
Eventually, that brought me to be really interested in staying involved with senior housing. Because it's an industry that you actually can do good, by doing well."

-Beth Burnham Mace, Chief Economist and Director of Outreach at National Investment Center for Seniors Housing & Care (NIC)

Do you know the difference between Senior Housing and Skilled Nursing?

We had the opportunity to sit down with Beth Burnham Mace to discuss, Senior Housing, and the difference between Senior Housing and Skilled Nursing.

Listen as Adam and Beth discuss the fundamentals of Senior Housing, the current state of the market, and demand drivers investors should keep an eye on.

About The National Investment Center for Seniors Housing & Care (NIC)

The National Investment Center for Seniors Housing & Care (NIC) is a nonprofit organization whose mission is to enable access and choice by providing data, analytics and connections that bring together investors and providers.


Learn more about NIC, click here

NIC Chat Podcast, click here

NIC Blog & Notes, click here

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Adam Hooper (00:03) Hello and welcome, I’m RealCrowd CEO Adam Hooper, and this is the Real Estate Investing For Your Future podcast. Here we explore the latest in commercial real estate trends, insights, and investment strategies that passive investors can use to build real estate portfolios that last.

Disclaimer (00:21) All opinions expressed by Adam, Tyler and podcast guests are solely their own opinions and do not reflect the opinion of real crowd. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions to gain a better understanding of the risks associated with commercial real estate investing. Please consult your advisors.

Adam Hooper (00:42) Our guest today is Beth Burnham Mace, Chief Economist of The National Investment Center for Seniors Housing and Care. In today's conversation, Beth discusses the fundamentals of senior housing, the current state of the market and factors that investors should be paying attention to be sure to check the show notes for links, to learn more about Beth and everything that NIC is up to. We hope you enjoy today's episode with Beth Burnham Mace. Well, Beth, thank you so much for joining the show today. We're excited to have you on, it's been an interesting time in the senior housing space, so we're excited to have you on and, and shed some light on what's going on in the industry. Thanks for joining.

Beth Burnham Mace (01:20) Well, Adam thank you for having me. I'm glad to be here.

Adam Hooper (01:24) Yeah. So, before we jump in. Why don't you tell us a little bit about your background in real estate and more importantly, what led you to NIC?

Beth Burnham Mace (01:32) Sure. So, let's go back to roll the clocks back a bit. I graduated from Mount Holyoke College and then I went to graduate school at University of California where I earned a Master's in Applied Economics. And I've essentially taken that Applied Economics Degree. And over my career applied it to various industries because the concepts are essentially the same. Supplied, demand, pricing, things like that. And I've applied that to banking and utilities, commercial real estate, and then eventually senior housing. I started at NIC, actually on its board about 15 years ago. And NIC is a National Investment Center for seniors, housing, and care. Also, known as NIC and it's a not-for-profit organization with the mission of trying to create more housing and care options for older adults. And we do that by bringing together capital and those who need the capital.

Beth Burnham Mace (02:21) So banks and lenders and equity groups along with the operators and developers. So, while I was at AW Capital Management where I worked for about 17 years, I really developed an expertise in senior housing. AW was actually one of the first institutional investors in senior housing. And back in those days, we didn't have much data and you had to do some primary research. And eventually that brought me to be really interested in staying involved with senior housing, because it's an industry that you actually can do good, by doing well or doing well by being good or any phrase like that. And, so I've been at, and I see now for about eight years on staff, but prior to that, as I said, I had worked on the board for about eight years as well.

Adam Hooper (03:05) Was there something about that industry that pulled you in? I mean, obviously it sounded like you said, doing good by doing well. And, and I think that's certainly something that, as we look at the population, there's much more of a need for that in these days. What was it about senior housing industry that really pulled you in and has taken to where you are with NIC?

Beth Burnham Mace (03:30) Sure. So, you know, within real estate, you're looking at supply market fundamentals, demand, fundamentals, and that might be for multifamily apartments, or it might be for office buildings, but with senior housing, I can apply all those same concepts, but to something that actually is making a difference in someone's daily life. Most of the people I've met in the industry actually are really nice people, too. Everybody's out to make, a profit for sure. These are people that are in the industry because they really care about helping older Americans and so that's a really nice aspect of it.

Adam Hooper (04:12) So Chief Economist and Director of Outreach. What, what does your day to day look like?  When you're looking at the macro facts and what sort of data are you looking at when you make these decisions or policy guidelines?

Beth Burnham Mace (04:27) Right, so, NIC actually is, I call it like the commerce department of senior housing data, because we collect raw primary data from operators and from individual properties. We collect information. How many units do you have? What's the inventory? What's the occupancy?  What are some of the challenges facing you as within the industry? So, we collect the primary data through different surveys and data collection. So, I spent a lot of time looking at the data and assessing it and. Pretty fun from my point of view, because we have the first look so to speak. So, we can really focus on the industry itself in terms of supply and demand fundamentals. And then I get to report that out to the industry broadly. I also get to hear firsthand from a lot of operators and developers and those who finance the industry on what the challenges and opportunities are, that they're seeing. And that's really fun too, from my perspective, to hear it and then process it, digest it, think about it and then write about it and speak about it.

Adam Hooper (05:28) And now let's dive in a little bit more there from a 50,000-foot view. Most, I think would look at the senior housing space as this kind of homogenous product, right? It's a blanket. Asset class that is senior housing and maybe not necessarily appreciation for the different levels of care and different operating models. So maybe help us understand under the umbrella of senior housing. What are some of the different, aspects of the different care levels and how do you look at maybe differentiating one facility from another?

Beth Burnham Mace (06:03) Yeah, that's a great question. So, you can think of it as a spectrum of care and at the lowest end of care needs or the lowest acuity levels would be what we would call independent living and independent living products would really be similar to an age restricted apartment but it would provide you housekeeping. It would provide you some meals, every. next to, that would be what we would call assisted living, which would include everything I just described plus care for what we call activities of daily living. So maybe you need help with medication management or with dressing or bathing or showering, so that would be assisted living.

Beth Burnham Mace (06:42) And then next to that sort of a higher acuity typically would be memory care. And that would be aimed at folks with dementia or memory care issues themselves. And then beyond that would be sort of skilled nursing, but for senior housing, typically we think of that as private pay, whereas skilled nursing is often government reinforced.

Adam Hooper (07:05) And I think that's one of the challenges from the kind of pure real estate mind is looking at this, because oftentimes there is an operational component versus say a multifamily complex or an office building, or some of the other asset classes, right? Where it's just a pure real estate play and you’re leasing spaces to tenants. And there really isn't like an active operating component. Right? Whereas sometimes in the hospitality space, we'll see that. And mostly, certainly as you get in those higher levels of care, there is an operating component. So as a potential investor, passive investor, which you most listeners on this podcast are. How should they think about looking at that from the real estate component and the operating component and how do that kind of play together in this asset class?

Beth Burnham Mace (07:55) Yeah, that's great. The closest thing you might have to this is maybe a hotel a little bit because there is an operational component to it. But the care needs are obviously more significant for assisted living. For example, the operator is key. In my career I've underwritten hundreds and hundreds of senior housing deals and it's not just the real estate. It's not just the location. It's really the operator and how well that operator serves the resident. And you could pen pencil out to be a fantastic property in terms of its location in terms of its competitive set in terms of, if you look at the revenues and the expenses, but if you don't have a really good operator, there is no single statistic, so to speak, to look at operator quality.

Beth Burnham Mace (08:43) But anyone who invests in senior housing, there's a fair amount of due diligence where you walk around the property. You meet with the operator themselves, or a lot of the institutional investors would have long term relationships with those operators themselves to understand what their strengths and weaknesses were. And a good measure is looking at the occupancy level, looking at referral rates. How many, how much of the new residents coming in are thereby referral from the existing resident? A few tricks that you can help get a gauge of how well the operator is doing.

Adam Hooper (09:19) Yeah, that's really helpful. Do you generally see a bifurcation between the real estate developer, owner, and operator, or are those usually one and the same?

Beth Burnham Mace (09:31) It can be all sorts of different structures. So, you might have a developer, who you know, is good at working with the contractors and things like that and, and figuring out how to get the land entitled, who may be on in and of themselves. Or you might have a developer who is in itself, the operator as well. And in some instances, you have the owners. As well as the operators being one and they're all the same. I think there's no secret sauce. There's a lot of, depending on what the individuals involved really prefer, you're going to see different structures like that.

Adam Hooper (10:10) And how big is the senior housing market right now? I mean, I think we've seen only a handful of deals on our marketplace over the years that have been in that asset class. I think it's been, over time generally there's and we'll talk. I'm curious to dig into some of the data a little bit more about supply and demand drivers, but I think the, obviously our population is aging. Everybody understands that I think there's an understanding there is a need for more facilities. How big is that market? And I guess maybe what you have seen in terms of transaction volume or new facilities opening up over the last five, ten years?

Beth Burnham Mace (10:47) Sure. It's definitely a growing industry it's valued right now at about $437 billion. It's a comprised of about 3.1 million units. And when I'm talking about like institutional quality market rate type properties. So, 3.1 million units about 25,000 properties. Half of those are nursing care properties. And then you can split the rest up into independent living assisted living and memory care and what we call CCRC or continuing care retirement communities. Increasingly gosh, I've been involved in this industry for more than 20 years and increasingly it's becoming more of an institutional asset type. With large pension plans, now more involved. CalPERS, CalSTRS, all the New York STRS.

Beth Burnham Mace (11:38) All the big pension plans have at least touched toe into the water here of senior housing. It's tracked by something called NCREIF which is National Council of Real Estate Investment Fiduciaries, which looks at all commercial real estate. So, it's tracked by that. We have over, almost 20 years of data tracked by NCREIF for senior housing, two very large public res real estate investment trusts are involved. Those would be well tower invent. it's tracked by wall street analysts. If I go back 20 years ago, most of what I just said, wasn't true. But today it is true. So, it's definitely become a much more acceptable, real estate investment asset type in which to invest.

Adam Hooper (12:21) Yea, and I'm curious, the composition of that capital, right? Most of what we see on our platform are syndicators, smaller institutional managers that are out. You're doing private capital raises, either from friends and family. And in some cases, smaller family offices, smaller institutions. What is the nature of capital for most of these projects? Is it regional managers? Is it again? You said a couple of the larger REITS that are out there, but is it from a manager in typical capitalization? What does that usually look like?

Beth Burnham Mace (12:55) It's sort of all the above in sense that it's got some, as I said, large institutional investors, and those are usually that capital that would be coming from a pension plan is usually managed through a group like where I worked, AW Capital Management, PGIM, Harrison Street Groups. But there's also, in fact, I was just on a call earlier today that there are also some small family businesses that are involved in this industry as well. And those, you typically see the investors with the family money investing in one or two managers or one or two operators. Those operators in turn building a relationship with those family managers. I literally was just off a call a few minutes ago, and there was one fairly significant investor in the industry, but he's got three or four sources of family capital, family office capital that have been investing that. And then you have the large institutional groups that are involved with the pension funds and then you have the public REITS that are on the public exchanges. So that raising capital that way.

Adam Hooper (13:57) And so when you look at a little bit more on the demand side touched on just general demographics aging population. When investors are maybe looking at markets that these assets are located in, what are some of the demand drivers that you're looking at from a data perspective or demographic perspective that make a market attractive versus another.

Beth Burnham Mace (14:20) Yeah. So obviously the depth or the density of seniors in a market. And typically, you look at households or individuals over the age of 75 but what might surprise some folks is that it's really important to look at the adult children as well. So, the adult children in this case would be those who have 45- to 64-year-olds. Those are the children of the parents or the people that would be living in senior housing, which is typically 80 and older. So, you often see the residents of senior housing move to be close to where their children are. Or to be close to where their grandchildren are. And usually it's an incident, maybe the adult child notices that the stove hasn't been turned off or there's some hazard that's not being taken care of properly.

Beth Burnham Mace (15:07) And so that will prompt them to try to urge their parents to be closer to where they are. So, it's a combination of both of those. So, in terms of demand drivers the strength of a local economy is important because if it's the adult children, you want to be in a market where there’s good job generators, job incubators, things like that. And I think importantly, so it's the demographics, it's the density and the size of the seniors, as well as the adult children. That's on the sort of the demand side. And then the supply is really trying to track the existing competition and what the potential competition might be in the market. It's the same for any commercial real estate asset type, right? You want to look at the demand supply balances as well as you can. And another factor might be to really look at, what I would call the penetration rate in a market. So how much senior housing exists for normalize it by the number of people who are over 75 or the number of people over 80.

Beth Burnham Mace (16:06) And you could argue that a high penetration rate is actually good. in the sense that people understand senior housing as part of the continuum of your life, you work, you retire and eventually you may want to move into senior housing in a markets where the penetration is high, such as Minneapolis. You see the occupancy rate surprisingly stronger than in a market that has a lower. Penetration rate because the product isn't as familiar, it's not as commonly viewed as part of the lifestyle of what happens as you get older. So that's an interesting nuance into the sector.

Adam Hooper (16:41) Yeah, I think the point of the I wouldn't have. thought to look beyond the older population, but the children of that. Right? I think that's an interesting factor of that familial connection. When it comes to that stage of life, are they going to stick closer to the children? Are they going to stick where they've been located? Primarily, that's an interesting one.

Beth Burnham Mace (17:02) Yeah. And in fact, there's a phrase now it's called baby chasers. So, it's a grandparents that are like running after we'll see where their children and their grandchildren are. And the other factor that's really important that certainly wasn't a factor 10 years ago was the labor force. And with the national unemployment rate, 4% and falling, it's not just unique to this industry, but industries right now are having a hard time getting workers and in less dense or more rural areas, it can be challenging to get the type of worker that you really want to be involved with senior housing, because it's not anybody that can really do this job. Has to be someone who has a strong heart and care and really want to help others. So, labor force is a factor that can make or break a senior housing market right now.

Adam Hooper (17:52) And so then when you switch around and look at the supply side, are there similar dynamics? I'm assuming to what we're seeing in the multifamily space, right? Very difficult to deliver any new product. That's not super high end due to construction costs and supply chain issues and development time and land costs and entitlements. How do you look at maybe stratifying new class ABC? Is there a similar metric that you look at in a senior housing space and what does that supply pipeline look? Are there older facilities that are being renovated? Is there a lot of new supply coming online from ground up developments? Maybe walk us through what that supply side looks like.

Beth Burnham Mace (18:31) Yeah. So, it's interesting. I think the senior housing industry is maturing. And what I mean by that is that you're seeing a broader differentiation, both by rate or price point as well as by the level of service or the acuity level. So, a few years ago, NIC produced a study called the forgotten middle, where we really tried to quantify the number of individuals in the US, what would be have middle income levels that couldn't really afford today's senior housing product. And it's a big number. It's like 14 million, people, by 2029 will be in that category of older adults. And so, we're starting to see more attention being focused in. How to supply the housing and the care that's required for aging seniors. So that's a huge opportunity. I don't think that anybody's quite figured out the secret sauce in terms of, how to do that at a profitable pace as well. But you also then see sort of what I would call the today's senior housing, which sort of serves higher middle income to wealthier client base. And so that's sort of the mid-tier point I would say. And then you're also seeing products being developed now for the, what I would call the Uber wealthy that can go nose bleedingly high, monthly rates. That you're seeing show up in some pretty high density. Well wealthy urban areas, such as New York, Manhattan, San Francisco, parts of Houston, and Boston that they're playing after the people who really want concierge services want things brought to them. High technology, high service. So, there's a whole stratification that's going on in the industry, which is to me is really exciting because it presents lots of opportunities, some challenges, but lots of opportunities to sort of find the niche that you want to work in. Is it a tertiary market, primary market, secondary market, and who it is that you're trying to target in terms of your client base.

Adam Hooper (20:37) So, let me just make sure I got these numbers right. So, you said there's by 2029, 14 million people that are in this kind of middle tier. The total market size right now is 3.1 million units, half of which are skilled nursing. So, we are 12 million units short roughly is that?

Beth Burnham Mace (20:58) No, no, no, no, I wouldn't. And it wouldn't, you wouldn't assume that all those 14 million people won’t be.

Adam Hooper (21:01) Ok. So, what percentage? It seems like a massive imbalance there, right? Even if you assume.

Beth Burnham Mace (21:10) There is a great need for housing options and the fear of course. My fear is that people will spend down to become eligible for Medicaid if they can't afford housing and care for themselves. And that certainly isn't a good solution for us in the long run as a nation. So, we really need to start to address the need for housing and care for middle income seniors. And if anything, during the pandemic and everything, probably the need is even greater. For that type of product.

Adam Hooper (21:41) Well, so let’s maybe explore that one a bit coming. We're recording this early 2022, hopefully fingers crossed on the other end of this pandemic becoming closer to endemic. Early on senior housing industry got a lot of heat from what was going on. And I think from an investor's perspective, certainly, a lot of investors just from that headline risk were really turned off from the industry. What would you say the state of the market, or the state of the industry is now where we're at in the pandemic? Maybe what's been learned since then and how you see that going forward. As we look past this.

Beth Burnham Mace (22:20) Sure. So first I think it's important to differentiate as we were at the beginning of our conversation between skilled nursing and senior housing and a lot of cases and a lot of fatalities occurred in excuse me, in skilled nursing and that kind of makes sense because unfortunately, as we know, this pandemic really targeted older people and by definition, a lot of older people live in skilled nursing, and you live in skilled nursing when you're particularly frail. So, it was a population that was very susceptible to COVID unfortunately. So, we've done a study that looked at and tried to differentiate the outcomes and fatalities for skilled nursing versus senior housing. And for independent living. For example, we found that the same mortality rates existed in independent living as existed in the general population. So that isn't necessarily what most people think about or see when they think about seniors housing, but it did differ depending on the population that typically is within an independent living assisted living memory care or skilled nursing. So that would be one point.

Adam Hooper (23:31) And I think, like you said, that goes back to the people that aren't specialists in this asset class. And again, this conversation today helps illuminate that, right? It's not just one umbrella of senior housing, right? There are those different tiers of care. And I think maybe a correlation, not causation is what you're getting to thereof looking, it's not just senior housing that had a disproportionate amount of mortality in this, in the pandemic. It was just that age of the population is what got affected the most. That happened to be a subset of the senior housing, right? Not the entire industry.

Beth Burnham Mace (24:06) Exactly. Right. Now, that said the industry was definitely, negatively affected and hurt by the pandemic. There were moratoriums that were put in place early on and back in April 2020, April, May. It seems long ago yet. So close at the same time. There was moratoriums put in place and some of those moratoriums were mandated by local or federal state government, but some of those moratoriums are also self-imposed. Most of the operators of senior housing and skilled nursing, they wanted to keep their residents safe. So they proved to be, in my view incredibly agile. If you go back to that time, nobody knew whether this was airborne, whether it was surface born, you couldn't get your PPE. The protective pro equipment for people you couldn't get testing. It was a really difficult, challenging time.

Beth Burnham Mace (25:01) So, it was hard for the industry and the industry lost a lot of occupancy and the occupancy rates, fell quite short. Felt quite sharply for senior housing down almost eight full percentage points during COVID to levels that hadn't been seen before. And that had more to do sort of same with apartments or hotels. There's a front door and a back door. So, you want to bring people in and then you don't want them to exit, or you want them to stay have as long a length of stay as they can for seniors housing during the pandemic. It was more of a front door issue. Because people were bringing people in again for safety reasons. So if they brought them in, they had to go quarantined for long time, pretty soon after. Well, I don't know. It depends on definition of soon, I suppose within several months, the whole idea of quarantining and isolating, resident became really understood that wasn't probably the best option because what increasingly is understood as part of the value proposition of senior housing is actually the socialization aspect of it. And we know that risks of isolation, there's studies out there that show, if you're isolated for a long time, it's equivalent to smoking 15 cigarettes a day. I don't know where they got that stat, but there's a stat so 15, so it's bad for, for you to be isolated and for you to be lonely. And that's one of the real proposition pieces of senior housing is that you don't have that. So, you saw a shift after a few months of the pandemic to try to make sure that there was still socialization and interaction, between people to the degree that you could. So, you saw warmer climates, you saw outdoor living rooms, so to speak, or you saw Plexiglas being put up to keep people breath. Again, once we realized that it was more of an airborne versus a surface borne illness that changed some of the parameters of how you could care for people as well.

Adam Hooper (26:57) And so now two years on from that. How is the industry recovered or reacted from some of those lessons learned?

Beth Burnham Mace (27:09) Happy to say that the industry is recovering and we're starting to see, in fact two of the, I have data that goes through the fourth quarter of 2021 and the fourth quarter in the third quarter of 21 were the strongest demand quarters in terms of move-ins in terms of absorption or occupied unit growth, that we've had ever on. So there was some pent up demand. And I think that, again, that sort of the value proposition of seniors housing, you have sec safety and security, but it's the socialization and the engagement, lifestyle choices chartered to become more desirable, and people really have been moving in. Now that said again, that's great. And the occupancy rates are higher, but they're still well below where they were going into the pandemic. So, there's still a way to go before we get back to those levels again.

Adam Hooper (28:06) So would you say overall right now, bullish on the prospects for the future of senior housing?

Beth Burnham Mace (28:15) I would say I'm cautiously optimistic.

Adam Hooper (28:21) We’ve been using cautiously. Maybe, I think we've been using that for about eight years now. We're cautiously.

Beth Burnham Mace (28:31) Well, we have the demographics that are certainly coming to us. Everybody's been waiting for the baby boomers to get to the age of wanting to move into senior housing. And we're getting closer. We're not quite there. The oldest baby boomer in 2022 is what? 76. So if the typical age is 80 to 82, that you are in senior housing, you still have a ways to go on that. But it's definitely moving in our direction. We had a bit of a pause in the supply pipeline related to the fact that a lot of construction debt wasn't available early on in there. June 2020 to probably June 2021. So that slowed down inventory growth. So that's going to help support occupancy rates. So, in the long term, I'm very bullish, but I'm an economist. I keep looking, what's happening now. How today's threats are, well obviously what's going on in Ukraine with Russia. And in terms of the impact that can have on supply pipe of supply chains and inflation. That's a big concern of mine right now is inflation. And what happens, especially to individuals who are on fixed budgets, which many seniors are on fixed budgets. So, how do you address that? And then how do just a simple increase in labor costs are affecting operators and their ability to maintain any margin. Insurance costs have gone up. So, we're not out of the woods. There's still a lot of challenges that have to be overcome and labor among them is a key one. But the demand drivers are, I think, in place, which should support future growth in the industry. And I'm especially excited about the prospect of figuring out how to provide housing and care to the middle-income cohort, because that's a big untapped opportunity.

Adam Hooper (30:11) And now you mentioned there again, we're recording this right in the midst early days of the Ukraine conflict. How from a market or maybe macro perspective, how insulated or impacted our markets for senior housing product, obviously it sounds like the economic engine of a local market is very important. But what are some of those macro national, are there global factors that are impacting this investors can maybe be thinking about..

Beth Burnham Mace (30:45) Yep. So, I think consumer confidence is really important and there was a recent survey just put out by Suffolk University, that consumer confide and also the University of Michigan's consumer confidence survey that showed that consumer confidence is very low right now. People are feeling pretty timid about where we are and largely that's related to inflation. It seems in America or the US, the price you pay at the gas pump dictates an awful lot above PE consumer sentiment. And with oil prices going above $110 or barrel, earlier today. Gas price are going to go up and that doesn't make people feel real good. So, I think that consumer confidence is really important. I think a sense of wealth that people might have from the stock market, which obviously isn't so great right now. Also has an impact, but overall, other statistics to sort of track would be housing and people often use their house, the equity from their homes to helps play for some of the needs that they're going to have for care and housing as they get older. So, home prices right now are quite strong. So that's bullish as well. So, I pay attention to labor markets again, I said were really important. So, I pay attention to that. Consumer confidence home prices, the velocity of home sales and things of that nature.

Adam Hooper (32:06) Yeah. Are there any other higher-level metrics that that investors should be paying attention to? And then also maybe a little bit beyond that, where can investors find or track this information?

Beth Burnham Mace (32:21) So there's lots of free content on NIC's website, which is We have regularly updated blog posts.

Adam Hooper (32:32) That's

Beth Burnham Mace (32:35) Right. Yep, we have blog posts, a newsletter, podcasts. A lot of things that you can get for free. So, I would say it's important probably to track the overall performance of the sector. And as I said, it is improving today, but you need to drill down into an individual market and into an individual property and into like a five-mile primary competitive market area around something to really make sure that you understand. And one of the best ways to do that is to truly track what occupancy is doing at like the competitive set. And that's information again, that's available through NIC, but you can also get that by walking a property and walking the competitive, set yourself. If it's a family investor to do that. So, you need to do your homework as you do with any kind of investment. Really, you can do a desktop, but you also really need to understand the local market. Cause there's no markets that are the same.

Adam Hooper (33:30) And are there any data points or stats or metrics that you're looking at more closely now coming out of the pandemic that have a better understanding for, or surprises that you saw during the pandemic. Anything interesting that came out of that, that you're paying attention to now?

Beth Burnham Mace (33:49) Well, we've been paying close attention to the incidents of case counts at the skilled nursing and at senior living property. We've been paying it to close attention to vaccination rates. Fortunately, this is a few weeks past the peak of the Omicron. I'm glad I'm talking to you today. It looks like a brighter horizon right now, but I'm still nervous. About if there's a new variant or something like that. But, that said, I think that there's been a lot of lessons learned during COVID a lot of lessons learned by operators and how to keep people safe. And I don't think that's going to go away anytime soon. So, I do feel pretty comfortable that even with standing, Omicron was pretty tough, right?  But that had more impact for operators actually on labor than it did on the residents themselves. Because there were a lot of absenteeism and sick time that was taken during that. But the, the residents themselves occupancy rates, really, at least so far doesn't look like they were very affected.

Adam Hooper (34:48) Yeah. And I think we saw that across all the labor markets. Right? I mean, I'm just thinking here locally, even just with kids in school, right. There was such a, a shortage. We had some bus routes and kids weren't getting dropped off until 5:30, 6 at night with the shortages. So, I don't think it's, I think that was a pretty widespread labor impact on that one.

Beth Burnham Mace (35:08) Yeah. We seem to be hopefully coming out of that.

Adam Hooper (35:10) Yeah. Fingers crossed. Well, Beth this has been a really great conversation. A ton of really good information. Again, really appreciate you coming on today. As we round it out, couple questions, we always ask where we're at right now. Again, everything going on that we talked about, what are some of the factors or concerns that are keeping you up at night as it relates to this asset class?

Beth Burnham Mace (35:33) I would say, I spend a lot of time, looking at individual markets and there are some markets in the US that are oversupplied,  that have particularly low occupancy rates. There are some properties that are suffering with pretty low occupancy rates. So, I worry about those properties, and I particularly worry about it because these it's more, it's not just properties, we're talking about people. And these are older adults. So, I do worry about that, that makes sure that those people are properly cared for. That's one thing that would keep me up at night and then the broader, just economic impacts on the sector. I would say as well.

Adam Hooper (36:09) And then converse. So that one has you most optimistic about the space?

Beth Burnham Mace (36:15) Well demographics for sure the demographics are coming at us and very excited about the use of technology in this space is it's changing it, that. People have Alexa now in their rooms and they can call on Alexa to do lots of things. A lot of labor saving devices that are being developed through technology so that's very exciting. I think the there's all sorts of new and really cool architecture, engineering designs that are coming about partly because of COVID. And the product is continually evolving, and we have this huge unserved market. This baby boomer generation and they never do anything like their adults, their parents did, right?  So, I think that it's going to be really fun to see how the influence that they all have on this sector. And we don't know what that is quite yet. What we do know is that this baby boomer generation is much more Involved and doesn't want to just sit back and coast. They want to be involved. They want purpose. They want meaning in their life. They want lifestyle changes. They really want to equate their lifespan to their health span, to their wealth span and match all those. So, wealth, health, and lifestyle and lifespan. So, I think that would be really fun to watch how that, how that emerges.

Adam Hooper (37:31) Yeah. So that's actually an interesting one. I mean, we've talked about it a lot on the show like looking at office for instance, right? How coming out of the pandemic, how we use that space is very different. Right? And I think what you just mentioned there, how the baby boomer generation is going to want to use that environment is very different than the generation before. Which, I mean, is that mostly going to be retrofit? Is that technology coming in is that a totally different use of the space? When you think about common areas you think about what are those things that make it an attractive amenity for the baby boomer generation as opposed to the prior. That seems fascinating.

Beth Burnham Mace (38:18) Yeah, no, it is really fascinating. And I was, I was on a call earlier as well today talking about a particular operator. Who's requiring people when they move into the properties to volunteer like two hours a week and you might go, huh? And it turns out she has incredible amount of waiting list to get in there because people are attracted to her property because there are people that like to volunteer. So, people want to be with that. And they also view it as an opportunity to not be lonely, to get involved. So, I thought that was pretty fascinating. And so that would, that would be, that would be a pretty remarkable difference, I think. And I don't know if that's generational, if that's just this one property, but, but it is something really interesting to think about because I think that the baby boomers do want purpose. They just don't want to be sitting and playing golf all the time. They want to have some meaning in their life. Involuntary.

Adam Hooper (39:13) I'll be fine. Just sitting, playing golf couple of times. I'll just put that out. Yeah. That's what I'm looking forward to.

Beth Burnham Mace (39:20) Oh yeah. We'll ask you when the time comes.

Adam Hooper (39:23) Well that is super interesting. And I think, I mean, again, there's a million different ways that technology's affecting real estate has an asset class in general. So, it's good to hear that there's a lot of innovation going on and ways to solve some of those unique problems in the senior housing space too. It'll be interesting to watch for the next decade or.

Beth Burnham Mace (39:41) Yeah, I totally agree. I totally agree. So just one last comment. There are institutions that just focus on technology and aging. For example, MIT has an aging. Where they just focus on that alone. And there's other universities in schools that are focusing on the use of technology to make

Adam Hooper (40:03) Yeah. That's good. Well, Beth, again, really appreciate you coming on today. This has been an area and an asset class that we wanted to dig in much more on and I think our listeners will certainly get a new appreciation for some of those nuances. So really thank you genuinely for coming on and sharing your time with us today.

Beth Burnham Mace (40:19) Totally my pleasure and good luck.

Adam Hooper (40:22) Yes. And we'll put links in the show notes, but again, real quick, best way for them to learn more about what you're up to with NIC and how they can get access to that info?

Beth Burnham Mace (40:31) Perfect.

Adam Hooper (40:35) And again, we'll have links in the show notes, Beth. Appreciate it.

Beth Burnham Mace (40:38) Thank you all. Thanks for having me. Bye everyone.

Adam Hooper (40:40) All right, listeners. That's all we've got for today as always. If you have any questions or comments, send us a note to and with that we'll catch in the next one!

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