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Editor's Letter 6 www.seniorshousingbusiness.com Seniors Housing Business n February/March 2017 Consumer demand for seniors housing remained robust in the fourth quarter of 2016, but not strong enough to offset the growth in inventory, reinforcing concerns of overbuilding. In the top 31 markets, the occu- pancy rate for assisted living stood at 87.6 percent during the fourth quarter of 2016, the lowest level since early 2010, reports the National Investment Center for Seniors Housing & Care (NIC). The occupancy rate for independent living was a healthier 91.1 percent. It was an active quarter for inven- tory growth across segments. "More than 5,900 units were delivered on a net basis, the most in a single quar- ter since NIC's data collection began in 2006," said Beth Burnham Mace, chief economist for NIC. "Inventory gains were strongest in assisted liv- ing, where nearly 4,100 units came on line." The annual inventory growth rate for seniors housing (both inde- pendent living and assisted living) was 3.1 percent in the fourth quar- ter of 2016, outpacing the annual absorption rate of 2.6 percent. This explains why Jim Sherman, senior vice president with Dougherty Mortgage, is so bullish on inde- pendent living. Since the recession, develop- ers have primarily con- centrated on building assisted living because it's need- based housing. Residents are there because they need help with some activities of daily living. Indepen- dent living is a lifestyle choice. "Right now there seems to be room for new independent living, especially if an operator has a pres- ence and a good reputation in the market," says Sherman. He expects 2017 to be a busy year on the construction front. "Even though some people say construc- tion is slowing down, I think we're going to be surprised by how much construction takes place." Let's hope that investors and developers avoid falling into the trap of irrational exuberance. If the complexities of HR rules and activities are keeping you from thinking and acting strategically, contact Aureon™. We provide a comprehensive suite of HR solutions and cloud-based technology so you can plan, scale, and manage your communities. Visit Aureon.com/SHB to learn what we can do for you. Why overbuilding concerns persist Matt Valley H O U S I N G B U S I N E S S ® SENIORS Seniors Housing Business® (ISSN 2168-9199) is published six times per year by France Publications, Inc., d/b/a France Media, Inc. Editorial and advertising offices are located at Two Securities Centre, 3500 Piedmont Rd., Suite 415, Atlanta, GA 30305. Telephone: 404-832-8262. E-mail: seniors@ francemediainc.com. Postage paid at Atlanta, GA, and additional mailing offices. POSTMASTER: Please send address changes to Seniors Housing Business, P.O. Box 47065, Plymouth, MN 55447-0065. ©2017 France Publications, Inc. Seniors Housing Business® is a registered trademark of France Publications, Inc. Subscription rates: USA 1 year, $78; 2 years, $112. Single copies are $15. The opinions and statements made by authors, contributors and advertisers to Seniors Housing Business are not necessarily those of the editors and publishers. To photocopy items from Seniors Housing Business in quantities of 100 or less, authorization must obtained from and a fee paid to the Copyright Clearance Center, 222 Rosewood Dr., Danvers MA 01923. Telephone: (978) 750-8400. For quantities of more than 100 or for PDFs, please contact Barbara Sherer, manager of special advertising at 404-832-8262 or bsherer@ francemediainc.com. For subscriber services, please call 1-800-869-6882 or write to: SENIORS HOUSING BUSINESS Customer Service Department P.O. Box 47065 Plymouth, MN 55447-0065; e-mail: SRHB@kmpsgroup.com Chairman and CEO Jerrold France President Scott France Chief Financial Officer Michael F. Jacobs Senior Vice President, Editorial & Operations Randall Shearin www.francemediainc.com Publisher Richard Kelley (914) 468-0818 rkelley@francemediainc.com Media Advisors (404) 832-8262 Eric Goldberg egoldberg@francemediainc.com Andrew Johnson ajohnson@francemediainc.com Ryan Nixon ryan@francemediainc.com Editor Matt Valley (404) 832-8262 mvalley@francemediainc.com Managing Editor Jeff Shaw jshaw@francemediainc.com Contributing Writers Jane Adler Bendix Anderson Lynn Peisner Published by France Media, Inc. Vol. 6, No. 1 February-March 2017