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Maturing Business Growth:
2023 Senior Living Trends
In recent years, the senior living industry has faced significant obstacles. Many of these obstacles occurred due to the global coronavirus pandemic causing necessary adjustments to business models to fit with the safety protocols essential to keeping residents as protected as possible. Through this adjustment period, senior care facilities had decisions to make, and some choices altered how the company functioned indefinitely. In 2023, the Small Business Lending team at The Bancorp sees areas of opportunity and growth for many senior living and assisted care facilities which can allow businesses to remain resilient through unexpected challenges.
Occupancy On the Rise
The demand for high-quality senior care facilities is growing. There are approximately 73 million aging adults from the “baby boomer” generation, or those born in 1946 through 1964.1 As this generation continues to age, we will begin to see a steady increase in the need for assisted living or senior care homes and the rate could possibly double the present number of individuals in long-term care over the next two decades.1-2
Looking toward the future with the understanding that seniors are living longer and there will be an influx of potential residents in the coming years creates positive options for owners and operators. As the baby boomer generation begins to enter their next stage of life, business owners should look at their facility and see if expansion is a feasible option to help meet this inevitable need in the market.
Improving Quality of Life
As the baby boomer generation ages closer to considering assisted living, they will bring with them an expectation of comfort and high-quality care similar to what they seek out for their parents residing in senior living facilities. Generally, this demographic is used to active engagement in their lifestyles, and as they age, the quality of life offered, a sense of community, and the opportunity to direct their own care will significantly contribute to where these individuals eventually choose to reside. Paired with research from the National Institute on Aging which indicates that isolation and loneliness bring a higher risk of a variety mental and physical illness to aging adults, there will be a growing need for vacancies in high-quality care homes.3
Our team has witnessed firsthand how providing exceptional and thoughtful design of philosophy, architecture, and care can be a successful business model. In 2018, the Small Business Lending experts from
The Bancorp Commercial Lending team partnered with Dr. Chris Mulrooney to help fund the opening of Villas at Killearn Lakes, a person-directed assisted living and memory care neighborhood of homes. Working closely with Dr. Mulrooney's team, the Commercial Lending team was able to serve as the primary financial provider to help secure an SBA 504 loan for the construction of the neighborhood-style community.
After opening in early 2019, the company was unaware of the challenges that lay before it in its first year of business. But because of their fundamental belief that assisted living should emphasize "living," their business model of creating a neighborhood of homes rather than a facility, proved to have additional benefits when facing the challenges of the pandemic. Their model, initially created to provide true home to the Elders (“teachers; wise ones”) that they serve, also helped provide increased safety during the pandemic by limiting interactions with only those staff who are dedicated to each 12-person home in the neighborhood. Larger facilities that have more foot traffic had increased challenges with infection control.
The company's attention to improving senior living does not go unnoticed. In 2022, the Villas at Killearn Lakes was named the 2022 Readers' Choice for Senior/Assisted Living Facility by the Tallahassee Democrat. Today, the company is successful and considering expanding the community to help provide quality care to the growing number of aging adults.
Staffing & Employee Retention
A challenge highlighted throughout the pandemic still affecting the industry today is staffing and retaining employees. With more adults aging into assisted living and senior care, there is an even greater demand for staff, even though this issue never seemed to ease as time passed through the pandemic. In addition, attracting and retaining qualified employees is competitive, which is reflected through the cost of personnel rising in most facilities.
Staffing challenges can be significant when paired with the growing expectation of high-quality care. Dr. Mulrooney shared that with his company's business model, relationship-based and Elder-directed care is a major contributor to its success. Dr. Mulrooney lends his advice to businesses struggling with attracting long-term staff "Operators should look to change or improve the culture for both residents and staff. These are key stakeholders in the success of both the fundamental care partner relationship, as well as the business and require unique attention from company leadership focusing on the needs of the individual."
Throughout the year, owners and operators in the senior living industry can look at the progression of these trends to strategize how their facility can improve or expand its footprint to help serve the aging community. When planning for what’s ahead, our team of experts from The Bancorp Commercial Lending is always ready to help bring your business’ future into the present. Learn more about the Small Business Lending options we offer by visiting our Small Business Lending website.
Opinions, findings, or perspectives contained in this blog are those of the authors.
All references to "The Bancorp" refer to The Bancorp Bank, N.A., the wholly-owned subsidiary of The Bancorp, Inc.
1. U.S. Census Bureau. “2020 Census Will Help Policymakers Prepare for the Incoming Wave of Aging Boomers.” December 2019.
2. CNBC. “Aging baby boomers raise the risk of a long-term-care crisis in the U.S.". November 2021.
3. National Institute on Aging. “Social isolation, loneliness in older people pose health risks.” April 2019.
Small Business Lending
Senior Living Trends