It may be true that the general economy and the housing market had experienced slow growth, but one thing that is certainly true is that there are players in the assisted living industry who increased their cash flow and occupancy during those hard times. The demographics in the USA point to a senior living market that is primed for significant growth.
Golden Opportunities in Assisted Living
The Why and How of Entering the Growing Senior Housing Market
America is aging fast. Currently almost 19 million seniors over age 75 are going to more than double to 44 million by 2025 (Census.gov - 2014). That represents a growth rate of just under 9% over that ten-year span. For commercial real estate, these figures represent a continually growing market for retirement housing and a massive opportunity for investors to participate.
Though overbuilding and a lack of understanding about the market led to high vacancy rates and foreclosures in the 1980s and early 1990s, recent reports indicate that demand for senior living housing will outstrip supply for at least the next 20 years. A 2014 survey of U.S. senior housing by the National Investment Center for Senior Housing and Care (NIC) found a median occupancy rate of 92 percent. That number was even higher in the state of Florida.
What is Assisted Living?
Of the three senior housing market segments aimed at healthy, independent seniors; assisted-living is forecast as the wave of the future, offering the most economical and flexible choice to consumers and a growing opportunity for investors and developers.
Assisted-living facilities go by a variety of names — residential care, board, and care, or sheltered care — and offer a variety of services to individuals with activities of daily living, or ADL, needs. In addition to providing ADL assistance on an "as needed" basis, assisted-living facilities are often less than 250 units-and more residential in design than skilled nursing facilities. They usually offer three meals a day in a communal dining room, local transportation, and extensive recreation programs. Occupants rent rather than own their units, which range from small suites to three bedroom apartments.
The popularity of this type of senior care is due to changing family roles as well as the general aging of the population. The typical resident is often a widow in her mid-eighties. Because of her ADL needs, resulting from age rather than illness, she can no longer live alone or prefers not to. Moving in with her adult children is often not an option, because they and their spouses work outside the home, leaving no one to provide daytime care. Thus, the most economical and desirable-choice is often the assisted-living facility. Tuscan Gardens® Capital Partners sponsors funds which invest in communities who manage a unique concept for senior living that provides a luxurious residential environment with personalized care closer to concierge services than general senior living. Therefore, the Funds are focused on upscale services and higher rates of return for its investors.
“Roughly, 70 percent of adults over the age of 65 will need long-term care at some point in their lives”US Dept of Health (Longtermcare.gov – 2016)
As more people live into their eighties and nineties in relatively good health, the over-85 population is expected to triple to seven million in the next 30 years. Because of demographics, economics, and desirability, the assisted-living market should experience steady growth for the next several decades, specifically the personalized care services offered through Tuscan Gardens®
Creating the Right Environment
Like most people, the elderly hate to move, and often, they do not want to leave "home" to receive assistance. The key to creating a marketable assisted-living community is to create an environment that resembles "home." The more the assisted-living community looks like a nursing facility or otherwise reproduces an institutional atmosphere, the more likely the project will fail. As more people live into their eighties and nineties in relatively good health, the over-85 population is expected to triple to seven million in the next 30 years. Despite the common misconception, the elderly do not want to be isolated from society; they want to be where the people are. Because of demographics, economics, and desirability, the assisted-living market should experience steady growth for the next several decades, specifically, the personalized care services offered through Tuscan Gardens® whose unique program and design set the bar high.
External and Community Aesthetics
The aesthetics of the building style as well as the landscaping (gardens, fountains, trees, and shrubbery) have a huge impact on our market. Rich Tuscan architecture, an open Tuscan Kitchen, and working rose gardens are just a few of the characteristics that define our brand. Tuscan Gardens® understands that attention to detail cannot be overlooked, as the resident's family will use this as a benchmark to evaluate care. If our community facility is well kept and cared for, our families will feel more comfortable that the personal care they (or their loved ones) receive will be of that same high quality.