Assisted Living Centers Cut Costs, Negotiate Fees
Assisted living isn't exactly recession-proof, but it has a solid customer base because it's need-driven business. Still, assisted living took a hit during the recession. Adult children who lost jobs became unable to help parents cover costs. Waning confidence in the economy, and a sputtering housing market recovery, have led some seniors to delay moving into an assisted living facility.
The occupancy rate at the end of last year fell to just below 89 percent, down half of a percentage point from the end of 2008. And rents didn't rise as much as they had in prior quarters, according to data from the National Investment Center for the Seniors Housing & Care Industry. In response, the industry has concentrated on cutting expenses to maintain profits and keep rents affordable. Operators have targeted food and labor costs, and have been more willing to negotiate fees to lure residents. In addition, more assisted living operators have provided new services and are even changing the way they plan communities.
Source: New York Times, March 5, 2010, Business section