“We love the design concept, but what will it cost to build?”
Cost estimating has always been a critical component in the planning process for senior living projects, which in the not-for-profit world have often involved bond financing. In today’s economy it is that much more important to answer this question early. But at the same time it’s increasingly challenging due to market volatility, worker shortages and lingering supply chain issues.
So how can you budget, and ultimately control costs, for your next senior living project? It starts with understanding a few fundamentals.
What Goes into a Cost Projection?
Cost projections are so much more than a standard cost per square foot. There are a myriad of factors that must be taken into account:
Project Scope: is the foundational program menu of spaces, functions, capacity and sizes. It’s when goals and aspirations are merged with quantitative requirements.
Project Size: is calculated in terms of gross and net square footage.
- Gross floor area includes everything within a building’s exterior walls.
- Net floor area is the usable square footage excluding walls, columns, lobbies, corridors, stairways, elevators, closets and utility chases.
Grossing Factor: refers to the ratio of revenue generating (living units) to common areas, utilities and wall spaces. It is impacted by building shape and program components.
- A straightforward linear building typically has a lower grossing factor than a structure with bends or curves.
- Smaller building types have a higher grossing factor than a larger building with more living units, such as a hybrid home versus a larger apartment building or a small house versus a larger care setting.
- Social spaces on each floor of an apartment building increase the grossing factor. For senior care settings, a medical model typically has a lower grossing factor than a household model which tends to have more common spaces.
Download the Senior Living Project Cost White Paper:
To continue reading about what goes into project costs, as well as factors that drive costs, strategies to control project costs and the cost of doing nothing, download the Whitepaper via the form below.
For more senior living topics, trends, projects and information about Hybrid Homes, Memory Care, Reinvention and more, check out our Resources Page.
Satellite communities are popping up around the country in many shapes and forms. Life Plan Community (LPC) sponsors and other senior services providers are increasingly turning to this expansion option when current campuses are built out, partnership opportunities emerge or new markets are explored.
As senior living providers seek creative opportunities to maintain vitality and market presence, satellite community campuses can offer distinct advantages for attracting a new generation of older adults.
- Growth opportunity
- Expanded market reach
- Distinct alternative product such as living in a more urban setting
- Unique partnerships such as University-Based Retirement Communities
- Leveraging existing campus resources and services
- A new value proposition – from Care Model to Vitality Model
Research conducted by Ziegler’s Senior Living Investment Banking team shows that of all of the new not-for-profit communities currently in the planning or development phase, roughly one out of three are satellite campuses that will be in close proximity to an existing, full-continuum community.
“This is a very attractive growth strategy for providers who are looking to build upon their existing brand and bring forth an alternative choice for seniors in their market”, says Lisa McCracken, Ziegler’s Director of Senior Living Research.
With proper planning, satellite communities allow for incremental growth and expanded market reach. They can neighbor a main campus or be located in another geographic area. A satellite can appeal to a new market group or meet a need for more of what already exists at a Life Plan Community.
Download the Satellite Community White Paper:
To continue reading and learn more about potential benefits and future planning considerations for this continuing growth trend for Life Plan Communities and other senior living services providers, download the Whitepaper via the form below.
For more senior living topics, trends, projects and information about Hybrid Homes, Memory Care, Reinvention and more, check out our Senior Living Resources Page.
As we look to the future, there are many questions about how the ongoing COVID-19 pandemic is going to impact senior living communities.
How will this health crisis reshape consumer priorities and delivery of services to older adults?
Are social isolation requirements and community quarantines causing people to re-evaluate senior housing options?
How do staff members feel about the added pressures they are facing and how is the new normal impacting their ability to provide services?
To start to answer some of those questions and help senior living communities prepare for the future, RLPS was one of the sponsors for a senior living survey of independent living desirability and safety spearheaded by Plante Moran Living Forward and Retirement Dynamics. This survey included independent living residents, prospective residents, and staff members in 70 communities located in 13 states. More than 5,000 survey responses were collected, along with 7,000+ write-in comments and compiled into the final report.
Download the Report
The COVID-19 Sentiment Report will help us better understand how people feel about living or working in an independent living community and how the pandemic is impacting future choices and priorities. The insights from this report will help us reshape senior living communities and services for long-term market strength and resiliency.See More COVID-19 Resources
Over time, things wear out, expectations change, and attitudes adjust. Things will never be as they once were, and the ability to adapt to change is the key to survival. Few community sponsors have the luxury to start over, but all have the ability to reinvent. Reinvention provides an exciting opportunity for good stewardship, while breathing new life into an existing community. As consumer demographics, product preferences and service priorities continue to evolve, senior living communities can, and must, likewise reinvent themselves to remain relevant.
“In the past, it was not unusual for many of our clients to be the only option in town, but that’s rarely the case anymore,” says Eric McRoberts, AIA. “Even in challenging economic times, providers still need to move ahead, it just might need to be more incremental.”
Whether for financial reasons, land constraints or stewardship of resources, reinvention is a viable consideration. If the existing infrastructure is a good fit for your program goals, substantial value can be gained from building re-use.