Seniors Housing Business

AUG-SEP 2015

Seniors Housing Business is the magazine that helps you navigate the evolution of the seniors housing industry.

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44 Seniors Housing Business n August-September 2015 n Development Developers pursue new plans for university-based communities while drawing on lessons learned from past experiences. Refresher course By Jane Adler Developers are going back to school by team- ing up with universities to build and expand retirement communities on campus. The move comes after an extended slowdown of university-based projects in the wake of the Great Recession, which curtailed home sales and limited the ability of seniors to move. The downturn also crimped capital sources for big projects and understandably fueled cau- tion at budget-conscious schools. Fast-forward several years and the college market is showing signs of life. Several big new projects are in the planning stages. A handful of existing communities are renovat- ing their facilities. Some are adding new units. Others are building skilled nursing wings to capture a slice of the post-surgery, short-term stay business. However, there's a major difference this time around. Developers and universities alike have learned some lessons from the downturn. Both parties are more attuned to what works and what doesn't. They now have a better understanding of the best formula for suc- cess, although major obstacles to the developments still exist. "The wave of the future will be projects with a tight integration between the academic and retirement com- munities," says Gerard Badler, managing director at Campus Continuum, a consulting frm based in Brook- line, Mass. "Everyone sees that those projects are more proftable." A feasibility study conducted by Badler's frm for a community at Winthrop University in Rock Hill, S.C., showed that seniors were less likely to consider a non-university community even if it were priced 20 percent below compa- rable real estate in the area. Universities and colleges have long had an interest in providing some type of housing for their retired faculty, administrators and alums. In fact, retired faculty who didn't want to leave campus initiated some of the early university-based projects. Retirement communities can provide a steady fow of income for the school in the form of land lease payments or other fees associated with the community's operations. The developer benefts too. The university provides a ready pool of residents and a mar- keting hook. The school also offers opportuni- ties for residents to attend stimulating activities, ranging from sports events to lectures to fne arts performances. Today, there are an estimated 100 university or college-related retirement communities nationwide. But the communities vary widely in nature. A majority of the projects are continuing care retire- ment communities (CCRCs), which offer a range of housing from independent living apartments to assisted living and nursing care. Most of the projects have only loose ties to the schools. In other words, the college does not own, oper- ate or govern the community. Ziegler, the Chicago-based investment banking frm with expertise in the seniors In late October, Belmont Village Senior Living plans to break ground on the Belmont Village at Berkeley, a 176-unit rental CCRC at the University of California- Berkeley. Belmont has a long-term ground lease for the university-owned land, which is within a mile of the campus. Rates start at $5,000 to $6,000 a month. "A good relationship with a school provides a leg up to reach stable operations and a durable future," says Sean Kelly, director of development, Kendal Corp.

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