Why It Matters
Highest and best use analysis is typically conducted at three moments: before acquiring a property, when planning new development on vacant land, or when considering major reinvestment in an existing asset. In senior housing, the analysis considers not only whether senior housing is the right use for a site, but which care level mix and community type would perform best in that specific market. The output of a highest and best use analysis often guides tens of millions of dollars in capital decisions.
The Austera Group Perspective
Highest and best use analysis is one of the most valuable pre-investment tools available to senior housing owners and investors, and one of the most commonly bypassed. Development teams and ownership groups often arrive with a preferred concept in mind, and the analysis becomes a validation exercise rather than a genuine strategic question. The strongest highest and best use engagements start with an open question about what the market actually needs, and they are often the reason a project ends up meaningfully different, and more successful, than the concept ownership originally imagined.