Monday, December 22, 2008
Assisted living centers feel financial crisis; Sunrise downsizes
Assisted living facilities are feeling financial pressures, largely because seniors may be having more trouble selling their homes for acceptable prices in order to move in. They may have to lower rental prices, and take on more debt to keep operating.
Similar pressures may be affecting other family members, who may need to live with seniors who have a harder time selling.
Normally, one would expect tremendous demand for assisted living facilities, given demographics. But because they are “self-pay” and cost so much to operate (especially since they are labor intensive) they are having difficulties nevertheless.
The Washington Post Business section today (Dec. 22 2008, section D) has a story about Sunrise, a large company with many assisted living apartment communities and even condos, and some overseas operations. Major accounting problems have occurred. A story by Michael S. Rosenwald, “Sunrise Hopes Dawn is Near: Firm’s troubles grow as economy outs pressure on assisted living”, link here. The article indicates that a bankruptcy filing could happen, but some other form of debt restructuring is more likely.
I have seen the inside of a Sunrise facility (back in 2000). The apartments, which may go up to two bedrooms, still are very small, with the emphasis on public areas. Some properties have signs offering a special units cluster or place for Alzheimers patients.
May 4 2009
Sunrise offered a report on its downsizing (or restructuring) plan, here.
Update: Oct. 16, 2009
Media sources report that Sunrise Senior Living has sold some properties to an affiliate of Brookdale Senior Living. A typical story is in the St. Louis Business Journal, Oct. 9, 2009, link here.