We're Not Building Fast Enough, and the Demographic Bill Is Coming Due

The senior housing sector is facing the most significant supply-and-demand disconnect in modern real estate—and the clock is running out.

By 2030, the United States will be $275 billion short of the capital required to meet senior housing demand.By 2040, that number could surge to $1 trillion.

This is not a cyclical challenge.It’s structural.It’s demographic.And it’s already unfolding.

The Demand Is Unstoppable

These aren’t speculative projections—they’re demographic certainties.

As strategist John Hauber put it: “Building to aspirations is an expensively fickle proposition.Building to aging is an experientially final certainty.”

We are not debating preferences.We are confronting a wave that is already hitting the shoreline.

The Supply Is Years Behind

After years of underdevelopment, high interest rates, construction costs, and labor shortages have slowed new starts to historic lows. Yet the aging population continues to expand, and their care needs are accelerating—not receding.

This gap between need and supply is widening every quarter, compounding into the largest senior housing deficit the country has ever seen.

And Yet—Senior Housing Keeps Outperforming

Despite headwinds, the sector has emerged as a top performer in commercial real estate:

Demand is resilient. Performance is durable. The demographic pipeline is undeniable.

Need + Performance = One of the rarest investment windows in modern real estate.

What This Means for Investors

For capital partners, the implications are clear:

This moment is not just about finding yield.It’s about building the infrastructure America will require for the next 30 years.

Investors who step into this gap—wisely, selectively, and with disciplined operational partners—are positioned to participate in one of the most durable long-term growth sectors in U.S. real estate.

Why It Matters to Mainstay Financial

At Mainstay, we see this not only as a financial opportunity, but as a societal responsibility. We are investing in communities where need is greatest—secondary and tertiary markets with:

Our focus is on building and acquiring assets that serve the real middle market—not the luxury tier—and aligning development, operations, and capital strategy under one integrated platform.

The demographic wave is coming.The supply will not catch up in time.And seniors will need environments designed for safety, dignity, and long-term stability.

The Bottom Line

This is more than a market moment. It is a generational pivot point.

We are not building fast enough—and we are about to pay for it.

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About the Author: Tod Petty serves as Chief Investment Officer at Mainstay Financial Services & Mainstay Senior Living, guiding capital strategy and investor relations. He authors The Build Series—a collection of insights designed to bring clarity and discipline to senior housing investment.