MEMORY CARE: WHERE THE MARKETPLACE STANDS NOW
Memory Care Structure a Barrier Max Slobin, vice president, senior payments advisor at KeyBank, which offers a senior living platform that owners and operators utilize for payments, liquidity, and lend- ing, said his customers’ top-of-mind areas of interest include the trifecta of COVID; labor and rising rates; how they can maxi- mize yield for their cash on-hand through operating accounts, non-operating accounts or excess corporate cash; and the automa- tion of core treasury processes, accounts receivable (credit/debit cards, ACH), and accounts payable (vendor payments).
Slobin said memory care currently faces
the same challenges as other seniors’ hous- ing asset types, including independent living and assisted living. “The challenges include unstable oc-
cupancy levels and elevated labor costs, but at amplified levels due to some of the inherent characteristics of memory care assets [e.g., shorter length of stay, smaller properties, more labor due to higher acuity of residents],” he said. “With relatively thin margins and fluctuating occupancy, memory care assets tend to have volatile net operating income. For these reasons, it’s
a very challenging time to own, operate or finance memory care assets.” In addition, Slobin said, “Many memory
care assets are financed with floating rate debt, which is spiking while occupancy and labor issues are depressing net operating income. This amounts to something of a ‘perfect storm.’” Mace noted that labor, particularly skilled
nursing, remains an impediment to growth in the senior living industry. In fact, she said, Bureau of Labor Statistics figures suggest that the number of people employed in as- sisted living has returned to pre-pandemic
“The challenges include unstable occupancy levels and elevated labor costs, but at amplified levels due to some of the inherent characteristics of memory care."
— Max Slobin, Key Bank
10 SENIOR LIVING EXECUTIVE MAY/JUNE 2023
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