Senior Living Industry Progresses In Care, Lags In Growth

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The senior living industry is readying new care models for a new customer, including by bringing more hospitality features into assisted living and baking more care into independent living. But lack of new development is holding the industry back from its true next iteration.

Earlier this week, I hosted a webinar on the future of assisted living, and came away with the notion that operators up and down the care continuum are building new care models for the baby boomers that give them a kind of best of both worlds as it relates to care and lifestyle services and amenities.

“Consumer expectations are shifting toward more of a hospitality-driven experience in a regulated care environment,” Cogir USA COO Gottfried Ernst told me during the webinar.

At the same time, the senior living industry is still relatively stuck in two areas that could help it grow to accommodate demand ahead. Development has slowed to a near-standstill in 2025, even as demand surges and occupancy grows. At the root of the problem is the fact that there are still billions of dollars on the sidelines that companies could otherwise use to jumpstart new projects. And the senior living industry still hasn’t done much with its quest to meet the middle market at scale, even as economic conditions continue to favor demand for those kinds of communities.

As I’ve written time and time again, the clock is ticking for senior living operators to create a product that appeals to the incoming baby boomers. That is both a challenge that will require creativity and also an opportunity that could pay future dividends. I think progress in assisted living and other areas shows the industry is making headway in serving a rapidly approaching new customer. But the lack of progress in development is still holding the industry back from truly creating a new generation of senior living communities.

In this members-only SHN+ Update, I analyze recent trends and offer the following takeaways:

– How senior living operators such as Cogir and Trilogy Health Services are moving senior living resident care into the future

– Other ways senior living operators are retooling operations for a new customer

– Why lack of movement on development and the middle-market is holding the industry back from iterating on current models

Senior living shifting care, lifestyle for the boomers

As Ernst noted on the webinar this week, new senior living customers are bringing with them desires for both high-quality care and the lifestyle amenities they enjoyed before moving into senior housing. At the same time, residents are arriving with more care needs than they did just five years ago.

That has prompted Cogir to “step outside of our box” and target a customer that “that we couldn’t care for maybe a year ago or five years ago,” he said. The company has added to its assisted living services a new program for older adults living with early-stage cognitive decline called Connections through which residents can get extra support and engagement.

Cogir also a couple years ago shifted to a hospitality-forward approach in assisted living, Ernst said. The company holds monthly public events where assisted living residents can mingle with family and friends or sample a chef’s tasting menu. The company also has communities with spa offerings, pools and other “hospitality flairs.”

“Our approach is clinical excellence behind the scenes and vibrant lifestyle out front,” Ernst said.

Trilogy Health Services builds communities with full care continuums spanning independent living cottages to skilled nursing, with individual care plans for residents. The operator purposefully creates campuses where residents, including those in different care levels, share spaces. The idea is that, as people age, they won’t want to move or potentially lose the friends they’ve made.

“You’re able to age in place and and still see your friends, even though you need more services as you age,” Trilogy Chief Nursing Officer Rhonda Dempsey said during the webinar.

Both said that these approaches have helped their companies keep average assisted living resident length of stay to between 18 and 22 months – and “hopefully growing,” Ernst added.

Evidence is mounting that operators that help residents “feel at home” benefit from better financial results and higher resident satisfaction. Assisted living residents surveyed by ASHA and ProMatura Group in particular valued their private units and decorations along with camaraderie with other residents.

Independent living communities are undergoing a similar shift. As assisted living communities go bigger on lifestyle and wellness services, independent living operators are doubling down on preventative health care and aging in place services.

“People are waiting to go in until they really need care, and that’s to preserve their capital, that’s to preserve their relevancy. These are not pension generation folks going in,” senior living industry veteran and new Mainstay Financial Services CFO Tod Petty recently told Senior Housing News. “We have to be able to flex in independent living and help people age in place.”

At the end of the day, senior living operators across the care continuum share a common goal of keeping residents where they are for as long as possible. I think new lifestyle and care models are indeed important, but I also agree with Petty that tomorrow’s older adults are going to want – and need – care and services that flex with their budget.

Lack of new development, middle-market growth still big challenges

For all their work developing new models for incoming generations, I think senior living operators still have their biggest challenge yet to overcome: Growth.

As I’ve written before, senior living operators must prioritize both evolving their models and growing to meet the needs of the next generation of older adults. But I believe aging and obsolete properties and a lack of new development are holding the industry back from truly landing on something new for residents.

The senior living industry is already struggling to keep pace with surging demand, leading to an “investment gap” in which operators could fall well short of projected need in the future. According to a recent Cushman & Wakefield report, which cites NIC MAP data, the industry must add 35,000 to 40,000 units per year to meet “peak demand” ahead. But the industry over the last 12 months has only added about 10,000 units.

“This reduction in projected supply growth, coupled with the increase in consumer demand, will be critical in the sector’s ability to offset the increased operating expenses caused by labor shortages and rising insurance premiums plaguing the sector,” the Cushman & Wakefield report reads.

Senior living leaders have told me that the lack of new development is a product of a financing drought – one that, according to the latest NIC data, is not letting up. Senior living construction loan volume dropped in the fourth quarter, “showing persistent lender caution toward new development,” wrote NIC Senior Principal Omar Zahraoui.

And there is another big need of the incoming boomer generation beyond evolving care and lifestyle services: lower costs. Even though many say they do, I still have not seen many operators deploy truly different middle-market models at national scale.

The most recent data says that by 2033, 15.9 million seniors will not be able to afford assisted living services as they are priced today – $65,000 annually, out of pocket, on average, or a little over $5,000 a month – while also not qualifying for Medicaid.

To me, the bottom line is that many senior living operators are iterating on their services or amenities for a new generation, and the data shows strategy has clear benefits. But unless the industry can figure out a way to build wider, with a more accessible price point – even as care needs increase and assisted living becomes more complex – demand for those new services may not materialize in the way that they had hoped.

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