Senior Living Construction Costs Brief Summer 2024

This special issue brief was prepared for the American Seniors Housing Association (ASHA) by Larry Graeve and Amy Burk of The Weitz Company.

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The public sector has outpaced the private sector and accounts for most of the positive movement in dollar volume in the first half of the year, which is up 11% year since this time last year. However, we are seeing optimism in the private sector as hopes for a federal rate become more likely by year end.

Currently, major indices are trending lower and we are seeing modest compression of contractor
margins as subcontractors seek to fill their backlog. The composite pricing on materials is around 4.5%
annually, while labor increases are in the 4-5% range. Labor shortages continue to plague the
industry with construction unemployment at 3.3%. It’s difficult for many firms to find quality trade
workers. We anticipate the overall escalation rate for the next 12 months to be in the 4-5% range.

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