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NIC Lending Trends Report Shows Ongoing Challenges for Senior Living

Lending, borrowing for senior housing and nursing homes "low" in 4Q 2023

NIC Analytics has released its 4Q 2023 NIC Lending Trends Report. The complimentary quarterly report includes data trends over seven years for senior housing and nursing care construction loans, mini-perm/bridge loans, and permanent loans from 3Q 2016 through 4Q 2023, and reflects contributions from 17 lenders

Key Findings:

  • Permanent financing for senior housing and nursing care remained inconsistent across lender types, reflecting ongoing challenges in the lending environment, including tighter lending standards, wider spreads, and lower loan proceeds.

  • Mini-perm/bridge debt issuance for senior housing showed a slight uptick but remained near the time series low.

  • New construction loan closings for senior housing saw a slight uptick from the previous quarter, which had little activity. However, the volume remained well below historical standards.

  • Related to construction activity, the previously released NIC SHARK report showed indications of increased activity in the Mid-Atlantic region, with construction figures showing positive growth in 4Q 2023 compared to 2019 levels.

  • Fourth quarter survey data reveals a reduced total balance of delinquent loans for senior housing, down by 13% from the time series high in 3Q 2023. Delinquencies as a share of total loans also decreased among contributing lenders to 4.1% for senior housing, down from 4.4% in the 3Q 2023. Conversely, the delinquency rate for nursing care rose to a time series high of 2.1% from 0.6% in the third quarter.

  • Total loan balances for senior housing decreased, on a same-store quarter-over-quarter basis.

  • The lending market for senior housing and nursing care in 4Q 2023 continued to show  movement in the positive direction, but investment opportunities remain suppressed due to higher interest rates and limited investment sales.

Click here to download the report.

Click here to download a slide presentation of the NIC SHARK series report,


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