Why Senior Housing Needs to Change to Appeal to Boomers
Stark views expressed at the Washington Innovation in Longevity Summit
Boomers are known for being a generation of influencers, rebels and change leaders. Now, they’re in a position to force a dismantling of the old models of senior housing. And, based on a panel I recently attended at the Washington Innovation in Longevity Summit, senior housing developers had better get to it soon. By 2030, all boomers will be over 65.
“Things are clearly not that good in the market,” said John Yedinak, the panel moderator, who is president and co-founder of Aging Media Network.
Senior housing occupancy rates dropped below 88 percent in the second quarter of this year, according to the National Investment Center for Seniors Housing and Care (NIC). That rate “has trended downward over the past 10 quarters, which is only two quarters short of its 12-quarter downturn during the Great Recession,” said Chuck Harry, NIC’s chief of Research & Analytics.
Little wonder, then, that in the new 2018 State of the Longevity Market Survey Report from Stria, a media platform for the longevity market, “reimagining senior housing” was viewed as “one of the most important topics in the field” now and in the next few years.
Downbeat Views at Senior Living Panel
The Washington Innovation in Longevity Summit, run by Mary Furlong and Associates, covered topics ranging from caregiving to entrepreneurship and was geared toward professionals and investors in the longevity and aging space. While some speakers were upbeat, this wasn’t the case at the Top Trends Defining Senior Living in 2019 panel.
“You know, 55+ communities don’t serve people who are 55, right?” remarked panelist Dan Hutson, chief strategy officer for the nonprofit HumanGood, one of the largest senior living community owners and operators. “They serve people 75…it’s 55 plus, plus, plus. They serve 75-plus.”
Hutson said current senior living residents are typically in their 80s — “if you’re lucky, the low 80s or high 70s.” HumanGood’s communities include senior living and affordable housing communities, along with continuing care retirement communities (known as CCRCs), providing housing and health care on a continuum of needs for older adults.
“When we talk senior living, obviously we’re primarily talking about housing, and not necessarily about community housing, but where seniors live, where they are going to experience their best lives,” Hutson said. Theoretically, that would be an appealing concept for boomers with housing needs and financially rewarding for housing providers who could deliver on the experience.
What Senior Housing Is Lacking
So why aren’t older consumers choosing senior living? At the panel, industry specialists offered different views.
“The big issue is that, as an industry, we have built product that does not align with what the consumer wants,” said Hutson. “We build communities, and our communities are very nice, and our residents love our communities. But the vast majority of people want to live at home because we have not offered options that can compete well with the home. And we have not done a good job of educating people as to the value benefits of community living.”
One of the value benefits, he said, is the power of congregant living, such as co-housing situations, roommates and similar supportive communities.
“I think that the industry has largely focused on developing the same kind of inventory that is basically a more contemporary version of what we built, 20, 30, 40, 50 years ago,” said Hutson. “And we don’t provide enough variety. We do not have choices. We don’t have options for people to look at and say, ‘This is the kind of community that will meet our needs.’”
Hutson added: “You know, we claim to all be snowflakes — every community is unique and individual. But in reality, if you talk to your consumer, your consumer will say, ‘Yeah, well I looked at these six communities and they are all pretty much the same.’
The Affordability Question
Vivian Vasallo, Fannie Mae’s director of innovation and partnerships, who focuses on health and housing, thought that cost was a major deterrent.
“I’d like to say that housing is a prescription for health,” said Vasallo. “If we are living in healthy housing, and we have the tools to help finance this, then we are going to be able to have better choices when the time comes, and we need to make adjustments. “So I think the way that we look at it is how can we first of all, bring more affordability in to the marketplace?”
About 70 percent of the market can’t qualify for affordable housing, but can’t afford senior living communities, either. The options are much more limited for them.
Panelist Wendi Burkhardt, CEO and co-founder of Silvernest (a roommate matching and house sharing service), agreed. She told the audience about her learning experience, growing the three-year-old business. “One of the things that was not on our radar until just the last year or two, based on market development, was affordable housing as a conversation. We really had not built that in to the very early prototype of the product,” said Burkhardt.
Hutson, whose company offers home-care service options, said: “People living in senior living communities are no different from those living at home. They want to stay in their homes. And their home may be that two-bedroom apartment that they have in our community. So we’ve had to develop home-care services that enable people to age in place in their own communities.”
A Key Benefit: Preventing Isolation
However, Hutson added, senior living communities provide a key benefit not to be overlooked: the prevention of social isolation.
“Having someone come in and provide home care is certainly beneficial. But it’s not a substitute for the kind of social integration, social experience you get by living in a community with people going through the same kind of issues,” he said. “We definitely need, as a society, to develop more options. Not just in terms of affordability, but also in terms of living situations. We are all looking for something different. And the market should be responding by creating lots of different opportunities.”
Senior housing developers, Hutson said, also need to think of ways to attract people looking to expand their horizons as they age.
There’s a market, he noted, for people who “need help in figuring out: ‘How do I craft a life in this period of time that is the best period of my life? How do I make this, the time that I look back on and say, that was really when I came into my own?’
What a Boomer in the Audience Said
While the industry specialists were insightful, perhaps the most powerful voice of the day came from a boomer in the audience. He stood and said: “I’m just struck by every discussion about senior living and senior housing, and the absence of a three-letter word. FUN. And, I just want to say as I’m reading here, some other words are missing. Spirit of adventure. Paradise. That’s a description from Latitude Margaritaville [the new Jimmy Buffett retirement communities], which to me is the most interesting development in senior living, not because of what they offer, but how they frame it and discuss it.”
He continued with an example: “My mother-in- law is in senior living. She was attracted, not by everything there, but by the art studio. In her mind, that’s fun. People, even at 88, the average age of those in assisted living, want adventure. They want new. They want discovery. And this is completely absent from any public conversation that I’d had with program directors.”
Calling for change, he ended by saying, “For me, I’m 65. Until as an industry, you deal with those types of issues, senior housing will continue to be associated with decline, and not rising to another level.”