In the introduction of the 2025 NIC Fall Conference session “New Money, New Models: The Next Decade of Capital Formation,” moderator Jonathan Schatz of CoastWood Seniors Housing Partners set the stage by declaring the seniors housing industry is facing an “existential moment.” Citing the lack of new development and subsequent shortage of seniors housing units nationwide, he stressed the importance of attracting new money to the space to help reposition facilities, build and develop new communities, and invest in best-in-class operators. And the time to do so is now, as multiple panelists during the three-day NIC event noted, because if we as an industry don’t find a way to meet the needs of this next generation of seniors, someone else will.

The “existential moment” Schatz speaks of was also described as an “inflection point,” with the main thesis being that both the volume and the variety of capital need to expand to meet the growing demand. Fortunately, new investors are entering the space at a notable pace, especially foreign money, as the favorable demographics are getting attention beyond our borders.

In fact, Kevin Maddron of Allegro Living, who said he had been to some 25 NIC events, noted this was the “first real push of new capital in a long time.” With that backdrop in mind, panelists discussed what investors are looking for in a seniors housing partnership and how operators can best position themselves to attract new capital.

Top of the Class

Investors (both foreign and U.S.) like clearly defined niche strategies with demonstrable upside, which makes seniors housing and its decades of positive demographics a good fit. Beyond the well-known demographics, investors are increasingly showing interest due to the strong industry fundamentals and recent performance. In fact, seniors housing posted the highest return of any asset class in the first half of 2025.

With the new supply pipeline weak while demand is growing, there should be ample opportunities and entry-points for the new investor. And as asset valuations are off peak levels, now could be an ideal time to buy, perhaps starting out with value-add opportunities and the lower acuity types such as independent living (IL) and active adult.

As one panelist summed it up: “The underlying demographics are there, and the yield is superior to alternatives.”

Focus on the Sponsor

Of course, seniors housing is not merely a real estate play, as the operational aspect is enormously important. Some new investors may have a real estate background and need to be educated on the operationally intense day-to-day business. Visits to the community are an ideal way to gauge leadership at work and see how they interact with residents. Investors want engaged staff and happy residents, not quiet hallways with no executive director or care provider in sight.

Assuaging investors’ operational concerns does not always happen right away, as it can be a process to get new capital to see the community as an operational building with real estate, as opposed to vice versa. For example, an investor with a real estate background may initially focus on a building’s features and amenities. Over time, however, they come to understand that focus should be on the management, culture, and overall operational excellence.

Likewise, investors are increasingly understanding the risk involved in selecting the right operator for a certain asset or market. Further, they want to understand the process for choosing an operator, and they want data supporting the decision. Some may have a “100-point checklist,” but regardless of specifics, the goal is to understand the reputation of the facility, reduce headline risk, and ultimately feel comfortable and confident in leadership.

Dedicated to Data

When it comes to demonstrating success, nothing tops quality data for today’s decision-makers. From labor costs to daily rent rolls, investors want operators who can reliably and consistently provide good data that tells the story of their community. In fact, panelists recommend that communities create a permanent position for a data specialist that can oversee this process. That is something happening in many other industries, and it would be prudent for those in seniors housing to do so as well, as having a data specialist on staff instills confidence in investors that the business is being run effectively.

Just the Beginning

With the underlying demographics more favorable than most industries have ever experienced, investor interest in the seniors housing and care is most certainly at an all-time high. And no one expects that interest to wane. Overall, organizations that focus on instilling best-in-class, forward-thinking and sustainable operations that cater to the new generation(s) of seniors will be well-positioned to attract and retain capital for the foreseeable future.

Connect with seasoned M&A experts at Lument to discuss strategic planning and financial execution and to optimally seize this window of opportunity.