The COVID-19 pandemic certainly transformed the commercial real estate investment landscape, but senior living continues to be an asset class of great interest to investors.
The senior-living real estate category is poised for growth in a post-pandemic world. Despite the industry challenges during the pandemic, today the demand for senior housing outpaces the supply and will continue to do so for many years. In the meantime, investors are finding a pipeline of distressed senior-housing properties that can be acquired and upgraded into high-performing assets.
As the baby boomer generation ages and lives longer, the need for assisted-living communities is only going to grow. Throughout each stage of their life cycle, the overwhelming number of boomers has upended traditional norms and marketplaces, and senior living is no exception. Other types of real estate ebb and flow, but senior-living real estate investment can provide safe harbor – especially during economically unstable times. And regardless of macroeconomic circumstances, people continue to age and require senior-living arrangements, driving demand for properties that can accommodate this rapidly growing population.
When it comes to investing in senior-living properties, individual investors have largely been frozen out of such large commercial deals due, in part, to the sheer size of the investment. However, the most significant change in real estate investing in recent years is the emergence of crowdfunding platforms.
Historically, large-scale real estate deals were funded through relationships with family offices and directly with institutional investors. However, real estate investment firms can now raise money via online crowdfunding. A crowdfunding platform allows a firm to post detailed descriptions and investment offerings divided into more affordable shares. Investors can review and browse various deals and select the investment that works best for them. Add in today’s technology and the ability to take virtual tours or see actual photographs, and potential investors have the world at their fingertips.
Once an investor reviews the offering documents and materials and decides to invest, the required documents and signatures are handled online, as well as the actual purchase of shares and portfolio management.
Crowdsourced commercial real estate investing is here to stay and will undoubtedly change how individuals approach senior-living real estate investments. No other investing innovation has made it easier for individual investors to participate in larger, institutional-quality deals across a greater range of asset types.
It’s also critical to remember that at the end of the day, while crowdsourcing is new and exciting, not all platforms are created equal. Investors must still consider the quality of each deal and the experience of the people behind it who are driving its management, value-add strategies and exit plans.
Are you interested in investing in senior-living properties through crowdfunding? Sign up with Lloyd Jones to learn more about senior-housing investment opportunities.