Senior housing occupancy is at its highest level since 2007, and 2015 was a record year for sales and institutional transactions, according to the recent CBRE Senior Housing Investor Survey & Market Outlook. The survey of U.S. senior housing investors, developers and brokers revealed 48 percent of respondents expect no change in cap rates during the next 12-month period, while 31 percent expect an increase in cap rates. The change in capitalization rates in 2015 was minimal compared to prior survey results, signaling that the market cycle is close to reaching a peak.

Investor interest (old and new) remains high, with 58 percent of respondents looking to increase their exposure to the space. The number of units under construction has increased from 22,975 at the end of 2012 to 48,903 as of the fourth quarter of 2015. With an average development period of 12 to 15 months, a significant portion of this supply will come online in 2016.

Total senior housing returns were reported at 16.3 percent, 14.8 percent and 13.3 percent over one-, five- and 10-year periods. These returns have outperformed multifamily returns over the same periods. For a copy of the survey, visit goo.gl/XQI3RH.