September 2-September 15, 2015 —
COLORADO REAL ESTATE JOURNAL
— Page 13AA
Senior Housing & Care
Ben Stellor
This is a timely question for JHL
as the first large senior living proj-
ect we constructed, Golden Pond
Senior
Living
Facility,
entered its
11th year
of opera-
tion this
month,
while at
the same
time we
are in the
final stages
of the $35
million
build-out
at the
Parker
Senior Living campus for
Morningstar.
We have seen many changes in the
market with some of the highlights
being the following:
n
Financial environment.
U.S.
Department of Housing and Urban
Development financing is not nearly
as prevalent as it was a decade ago.
n
Increased amenities.
Amenity
spaces have become a primary focus
and differentiator, institutional
environments are no longer accept-
able. The comforts of home and, in
most cases, even a resort feel are
the goals of today. Today’s commu-
nities support a movement toward
keeping residents active/engaged on
a daily basis.
n
Memory care market.
Memory care 10 years ago was
something that may have been fit
into a small portion of an assisted-
living facility. Today we see stand-
alone buildings or separate wings,
with their own amenities being
built.
n
Code changes.
Over the
past few years, the changes from
Colorado Department of Public
Safety Division of Fire Prevention
and Control have led to many sig-
nificant evolutions of the code and
changes in the inspection process,
which have, in many cases, impact-
ed project schedules. Additionally,
gone are the days of a multistory,
wood-framed AL building with an
integral MC component. Changes in
code and licensing have caused any
multistory building with MC to be
noncombustible construction.
Thomas Kooiman
In the past 10 years, we have seen
a large
transi-
tion in the
designs
of senior
facilities
we are
building.
Ten years
ago these
facili-
ties were
designed
for the
WWII and
depression
era genera-
tion. Their
expecta-
tions were
far less than today’s generation of
senior housing tenant. They had
modest homes that were small by
today’s standard, and the standard
of living requested was modest for
this generation.
With 5 million seniors in the mar-
ket today growing to 13 million we
are seeing a boom in the next gen-
eration of facilities to meet the mar-
kets expectations. This next genera-
tion is coming from homes where
room sizes have grown significantly
with a much higher finish quality.
For example, granite countertops,
higher-end cabinets, new lighting
features, larger kitchens and low-
energy appliances are all desired
due to changed expectations for this
next generation. Unheard of just
a few years ago, we are also seeing
units as large as 2,000 square feet
in some cases. In addition, the new
properties have incorporated more
exterior amenities and health facili-
ties to match the healthy life styles
this next generation requires.
From a construction standpoint,
it’s interesting to note that more
projects are returning to wood-
frame construction. The disparity
of pricing between wood and steel
was close enough in the mid-2000’s
that many projects were being built
out of steel. Today we are seeing a
very high percentage being designed
in wood nationally. This trend is
clearly attributable to the cost of
materials.
Another trend we have seen is the
demand for neighborhood locations,
in town and infill sites. The next
generation of tenants want to stay
connected to the community with
the ability to walk to retail, parks
and the local grocery. It is an inter-
esting time in the senior market
and we are excited about our role
nationally.
Derek Stathis
There are two major differences in
the construction of senior housing
buildings in the last 10 years.
The first is the occupancy and,
thus, the construction type dictated
by the code interpretation of local
fire departments. In the last few
years, there has been a push by city
officials to consider memory care
residents
incapable
of self-
preserva-
tion. This
requires
construc-
tion to
comply
with I-2
occupancy
type limita-
tions, most
notably
height
restrictions
if built
in wood.
This restriction can interfere with
an owner fulfilling its vision for
campus layout/density. Many recent
designs have attacked this limita-
tion with either a stepped-building
or a pod/neighborhood approach,
which can effectively separate this
I-2 occupancy type building from
other less-restrictive AL units.
The second major difference
comes from the recent creation of
the Colorado Department of Public
Safety Division of Fire Prevention
and Control, whose role includes
determining which communities
require state inspections. For exam-
ple, if a community is private pay,
then only a state operating license
is required. However if Medicare/
Medicaid is accepted, the commu-
nity must become a Certified Health
Facility with the state. Buildings in
this category can be subject to field
inspections from both the city and
state, which often results in conflicts
between code interpretations and
sometimes which code governs over-
all.
Without an experienced design
team and
contractor, a community
developer could encounter overlap-
ping jurisdictional complications
with conflicts in code interpretations,
associated delays, possible tear-outs,
redesigns and reconstruction.
Bruce Porter
Just 10 years ago, companies were
building senior living communities
for The
Greatest
Generation
(individu-
als born
between
1901 and
1945).
Members
of The
Greatest
Generation
were con-
servative,
risk averse
and primar-
ily focused
on peace
of mind.
To sat-
isfy these essential, albeit minimal,
needs, companies were focused on
building units with practical and
modest finishes.
Today’s assisted-living community
is no longer targeted to the consumer
(e.g., the 82-year-old widow who is no
longer able to live independently). In
fact, the assisted-living community is
marketed toward the customer (i.e.,
the widow’s 52-year-old child). While
the child is looking for facilities for
their parent, she often thinks, “This
is O.K. for Mom, but I would never
live here.” Developers, therefore,
have adapted to this change and now
focus design and marketing primarily
to the customer. Developers promote
facilities with technologically adept
units and outstanding amenities.
Although sustainability is a driving
factor in many industries, it’s less
critical for the senior living customer.
The bigger draw is location – is the
community in close proximity to the
resident’s children? Proximity will
drive the decision today, as well as
the foreseeable future.
The challenge for developers, con-
tractors and operators is finding the
resources to build affordable units to
match the physical needs and finan-
cial limitations of an aging popula-
tion. To rent or purchase their
unit, many residents ultimately
will require government funding
to supplement their incomes and
assets. This reliance is problematic
because, undoubtedly, those sub-
sidies will be insufficient, as the
population expected to reside in an
assisted-living community is far
greater than the funds the govern-
ment will be able to sustain.
s
What are some differences in the senior housing and care
buildings being constructed now compared with buildings that
were constructed 10 years ago?
Question of the Month
Please contact Pyms Capital Resources or The Highland Group if you would like to participate in the Senior Housing & Care Question, or if you have a question that you would like to see addressed.
Bruce Porter
Director of business
development, Weitz
Construction
Thomas Kooiman
Director of business
development - Western
Region, Brinkmann
Constructors
Derek Stathis
Senior project manager,
Pinkard Construction
Ben Stellor
President, JHL Constructors
“We are con-
stantly learn-
ing from the
residents, staff
and families
who are living
in, giving and
receiving care
in our senior
communities.
On a parallel
track, govern-
ment rules and
funding sources
are continually shifting their
requirements and expectations.
Our newest generation of housing
and care buildings is a product
of those forces. I want to thank
our four responders for sharing
their viewpoints about how such
forces are defining the structures
within which we house and care
for people.”
MODERATOR:
Elisabeth
Borden
Principal, The
Highland Group
Amenity spaces
have become a
primary focus
and differentiator,
institutional
environments are no
longer acceptable. The
comforts of home and,
in most cases, even
a resort feel are the
goals of today.
The challenge for
developers, contractors
and operators
is finding the
resources to build
affordable units to
match the physical
needs and financial
limitations of an aging
population.
