One way that senior living providers are addressing the need for greater assisted living occupancy is through unitconversion. Conversion is enabling housing providers to adapt to the evolving needs of the seniors as well as respond to market changes, increasing the demand for skilled nursing and memory care units. Converting housing units to cater to residents that require additional care can help senior living providers generate revenue as well as increase occupancy at traditionally underperforming communities. One Dallas, Texas-based company is demonstrating success with this method. Capital Senior Living Corporation has seen increased revenue and occupancy, especially among their first four converted communities.
The first four communities converted by Capital Senior Housing were completed by the end of Q3 2014. The impact has been incredibly positive for the company. At one community (location undisclosed), the occupancy increased from 69% to 93.1% as of March 31, 2015 as a result of conversion. A second community saw occupancy growth from 84.5% to 95.7%. The third community was at approximately 55% occupancy prior to conversion, and now is 80% occupied. The fourth property expanded assisted living and memory care saw demand rise significantly. That community was at 95% occupancy before conversion was completed, and is now at 96%.
The revenue increase has been significant, with the first four converted properties’ combined revenue generation up 19% over the first quarter of last year. Capital Senior Living as a whole has increased its revenue by $6.8 million from last year. The company plans to upgrade over 400 units from independent living to assisted living and memory care by the end of the current quarter. Results have been so positive that Capital Senior Living plans to have an additional 90 conversions completed by the end of 2015, and another 200 are planned for 2016. Capital Senior Living CEO Lawrence Cohen remarked: “We are successfully executing on our strategic plan, and believe that we are well positioned to make meaningful gains in shareholder value as a substantially all private-pay business in an industry that benefits from need-driven demand, limited new supply, and an improving economy and housing market.”
Contact Cambridge Realty Capital
Cambridge Realty Capital specializes in providing financing and capital for large-scale improvements to senior living facilities. If your company is considering unit conversion as an option to address the changing senior housing market and increase occupancy in your community, contact Cambridge Realty Capital. Our dedicated experts are standing by to help you improve your community.