Senior living operators face a challenge: occupancy rates are rising, yet performance expectations keep climbing.
At an industry event in Chicago this week, executives from Ventas, Atria Senior Living, and Merrill Gardens described a sector where demand remains strong but uneven.
Occupancy rises, but not equally
The industry’s average occupancy now sits just under 90% in top primary markets, according to data from NIC MAP. For some operators, that figure is even higher.
Gains remain inconsistent. Frank Small, managing partner and CIO at the Senior Living Transformation Company, compared the aging baby boomer population to a tide that lifts some markets while leaving others untouched. Affordability, care needs, and local competition shape outcomes, sometimes even between similar properties in the same city.
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“It’s so asset-specific, so market-specific, so operator-specific,” Small said during a panel. “You have to drill down a little bit.”
His firm recently acquired a property in Fredericksburg, Texas, a market that might seem ordinary at first. Yet with a high concentration of millionaires and a Waldorf Astoria under construction, the area offers a unique opportunity. “We’re trying to see past some of the NFL cities and get past the soundbites,” he said. “There are many great places where our target consumers want to live.”
Development persists, but selectively
New construction remains near historic lows, though some companies continue building. Experience, patience, and vertical integration make the difference.
Leaders from American House, REDICO, and Cogir described a careful approach to growth. Projects that move forward typically have strong financial projections, often supported by in-house teams that control costs and streamline operations.
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Only those with deep expertise are pushing ahead for now. “There’s going to be a lot of money, a lot of experts flocking to senior living,” he said. “They’ll find a way to build it faster, cheaper.” The industry has faced slowdowns before.
Leadership as a competitive edge
With occupancy high and margins tight, strong leadership sets companies apart. Good leaders aren’t just hired—they’re developed over time.
“Certainly, there are fundamental traits we want to hire for: good judgment, willingness to learn, empathy,” said Brenda Schreiber, chief experience officer at Mather. “But leadership is developed through experience.” She emphasized the need for cross-department collaboration, urging executives to break out of silos. “It’s natural to get lost in your day-to-day operations, but the biggest opportunity is system thinking.”
Succession planning presents another challenge. Many current leaders built the modern senior living sector, and their eventual departures will create a knowledge gap. Jason Childers, COO at Merrill Gardens, advised operators to hire people who can eventually replace them. “Hire people who are smarter than you, and give them the opportunity to step in and do bigger and better things than you did,” he said.
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Pressure isn’t just internal. As occupancy climbs, real estate investment trusts like Ventas are raising expectations. Justin Hutchens, CIO and EVP of senior housing at Ventas, said the “new standard” is “zero lost revenue days.” Operators must balance resident care with financial discipline, using analytics to track performance and retention.
Hutchens noted that good operators focus on both resident well-being and staff satisfaction. “That is combined with really good analytics,” he said.
The industry continues to evolve, with operators adapting to shifting demands.
