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The senior living investment industry has demonstrated remarkable resilience, emerging stronger in 2025 with renewed investor confidence, stable capitalization rates, and robust rent growth. This resurgence is fueled by favorable demographic trends, improved sector occupancy, and a positive outlook for the future.
A year ago, the senior living industry faced challenges such as decreased bank profits and loan losses. However, with a new administration and shifting priorities, industry experts now project enthusiastic optimism. The 2025 NIC Spring Conference highlighted this positive shift, noting that the sector has moved from a “survive until 2025” mindset to one of growth and opportunity.
Investor interest in senior housing continues to rise, with 78% of investors planning to increase their senior living portfolios this year. This surge is driven by favorable demographic trends, improved sector occupancy, and recent transaction activity. Assisted living leads the pack, with 50% of investors identifying it as the top opportunity over the next 12 months, up 22% from 2024. Independent living, skilled nursing, and active adult communities also attract significant investor attention.
The seniors housing sector anticipates capitalization rates for all care levels to remain flat or compress this year, aligning with 2024 trends. This stability is accompanied by expectations of significant rental rate growth across all care levels. More than 90% of respondents in BBG’s third-annual seniors housing investor survey expect rental rate growth for property types excluding care. Notably, over 40% anticipate prices to grow more than 5% for assisted living and memory care facilities, while over half expect rents to grow between 1% and 5% in this category.
The aging population continues to drive demand for senior housing. The sector benefits from low development levels, which, combined with favorable demographic trends, strengthen market fundamentals. This environment creates a competitive landscape where investors vie for quality assets, anticipating long-term stability and growth.
In 2025, the senior living industry stands on solid ground, characterized by resilience, increased investor interest, stable cap rates, and robust rent growth. These factors, underpinned by favorable demographics and strong market fundamentals, position the sector for continued success in the years ahead.