In Naples, Fla., WCI Communities recently completed a beachfront tower that targets well-heeled buyers in their 50s. Its penthouse is priced at $12 million. In Atlanta, James, Harwick + Partners is designing a subsidized apartment building for low-income retirees that includes a surround-sound theater and a fitness center. And in Sarasota, Fla., the master-planned Lakewood Ranch community will include an on-site assisted-living facility.
Once upon a time, so-called seniors housing was designed for the 70ish set. In addition to institutional nursing homes, it usually consisted of apartments or a string of cottages with access to medical care. But architects doing retirement housing today are dealing with a more discerning and complex group of buyers, people whose ages can span 40 years and whose income levels, lifestyles, and health needs range just as widely. The types of businesses venturing into this market have become more diverse, too. Private developers, nonprofit groups, large corporations, hospitals, insurance companies, and universities all are getting in on the act. As the market heats up, architects who can identify the hot buttons of baby-boomer housing and provide thoughtful, cost-conscious design have a ready-made niche that will take them far into the future.
Retirement housing has many parts. At one end of the spectrum are active-adult communities that look, to consumers, like any other residential development. About 9.5 million U.S. households are living in age-targeted or age-restricted communities, estimates the NAHB Seniors Housing Council. At the other end of the line are continuing-care facilities--more than 17,000 in the U.S., according to Thomas Fairchild, director of special projects on aging at the University of North Texas, Fort Worth. Between these extremes are independent-living projects, which offer hospitality services, and assisted-living facilities, which are hard to define because they have no single blueprint and regulations governing them vary from state to state. The Assisted Living Federation of America defines an assisted-living facility as a core of housing with personalized services for those who need help with daily living, including nursing care for Alzheimer's patients. ALFA puts the number of such residences at 20,000. But it's the active-adult segment that's growing the fastest, because boomers are retiring earlier.
retirees at play
"The number of active-adult communities is growing rapidly, largely because of the recognition that baby boomers are marching toward golden ponds," Fairchild says. Indeed, most production architects have been led into age-restricted housing by their longtime clients. As baby boomers entered their 50s and 60s over the past decade, developers moved with the market. Vacation destinations such as Hilton Head, S.C., evolved into retirement havens. Now, though, builders are seeing growth opportunities outside of Sun Belt states, in metro areas like Cleveland and Chicago. Many retirees have no intention of leaving the familiarity of their hometown.
Like any other housing market, the active-adult segment of the seniors population breaks down into niches from which architects can pick and choose. "The fragmentation of the market is the thing we're all paying attention to," says Mike Kephart, Kephart Architects, Denver. "What can they afford? What cultural background do they come from? What kind of lifestyle interests do they have--city life, rural life? The wise builders are selecting the ones they can deal with as a service, and going at it that way."
Architects who wish to pursue this market must be able to convince builders that they have a good idea who the buyers are--their interests, their income level, and their psychographics. "The biggest issue is that the active-adult buyer is a discriminating one, no matter if they are blue-collar or a corporate executive," says Gary Snider, AIA, of Bloodgood Sharp Buster's Boston office. "You have to understand the price point in your market and design to that price point. On top of that, you have to design something that's better, in terms of community planning, lifestyle, and features, than what they have now. You must be able to show them how they will live in that house now, and 10 years from now, and 10 years after that. The more specifically you define the values of your buyer profile, the more successful you will be."
Active-adult communities typically include some of the elements of a town center, such as a post office, a library, a large sports facility, and meeting spaces, so the land-planning element is as important as the design of the homes. Legibility issues are critical--how one navigates the site, the width and configuration of streets, and whether to use intersections or roundabouts. Developer Tom Zanic, president of New Urban West, Santa Monica, Calif., says he looks for architects who are as well-versed in the big-picture issues of community layout, technology, and security as they are in the things that make houses easier to live in, such as flexible spaces and universal design.
aging in place
Three years ago, James, Harwick + Partners, Dallas, coattailed into seniors housing after funding for a HOPE VI project fell through. The developer, with whom JH+P had worked for 15 years, quickly put together creative financing that supported two multifamily independent-living projects on a portion of the site. One was a three-story building with an elevator, the other a one-story building with four units. "We learned that once you provide an elevator, it's most efficient to go to a three- or four-story building, getting as many units per floor as you can and reducing the footprint, or the distance people have to walk," says Ron Harwick, AIA. "It's hard for residents to navigate long corridors."
Through research, the firm has also learned that multifamily seniors units should be 50 to 75 square feet larger than similar market-rate apartments. That's because most residents are leaving homes in which they've raised children and have gathered furniture over the years that's sized for a larger house. "When they make the transition to an apartment, they ought to be able to bring some of the things that are near and dear to them," Harwick says. "We needed to educate developers about the need to upsize the living areas in the units, and the costs associated with that." Nevertheless, he points out that the discipline of multifamily work--avoiding unnecessary circulation space such as hallways and creating rooms that look bigger--works particularly well for seniors, who want step-saving layouts that feel expansive.
JH+P is partnering with the Atlanta Housing Authority and developer Columbia Residential on its second such project, subsidized seniors housing. The 132-unit rental complex will include amenities usually reserved for higher-end projects: large computer rooms, a dining area where food is brought from off-site, an arts-and-crafts room, a library, a fitness center, and a movie theater. "We had seniors housing pegged for the last four or five years as a growth niche market and did the appropriate research so we could handle it when the opportunity came along," Harwick says. "Now we're doing independent living, but we're headed toward assisted living and even more institutional-type markets."
Baby boomers are a moving target. With increasing age come increasing health challenges. Over the years, the mix of amenities in active-adult communities has shifted. Clubhouses now include offices for dentists and doctors. Small-scale medical-care facilities appear on site. In a bid to hold on to clients as they grow older, developers and land planners are designating sites in or near master-planned communities for a hospital or Mayo clinic, assisted living, and continuing care.
Don Evans, AIA, The Evans Group, Orlando, Fla., is keeping pace with aging boomers. Twenty-five percent of his firm's work is in seniors housing now, compared with 10 percent a decade ago, though most clients assign the medical components to specialists. "We find ourselves doing these retirement projects on a joint-venture basis," he says. "We're responsible for certain portions of it and oversee the project with municipalities, but are told to use a particular firm for the design of the total life-care facility."
CSD, in Baltimore, is one of a handful of large firms across the country that design and oversee the total package, often teaming up with local architects. Its projects, many of them $30 to $50 million and up, in-clude fully independent single-family homes, duplexes, and apartments; assisted-living facilities that deal with dementia; and continuing care. "It's very specialized because it's not just housing, not just nursing, and not just country club," says Glen Tipton, FAIA, the senior vice president and senior-living studio director, who oversees a staff of 90. He also chairs the AIA committee on design for aging. "It's a mixture of hospitality, medical services, independent living--and, frankly, that's what I find so challenging and addictive about it. We just opened an office in Dallas to begin reaching farther west, because the demand is everywhere."
Given their complexity, the learning curve on these projects is long--Tipton says it took 10 years for CSD to get up to speed--and so is the time from concept to completion. The projects don't have a predictable schedule, and may sit for a while in the zoning and design process. "They can take four to six years to come to fruition, so it takes staying power," Tipton says. "You have to have the capacity to absorb the peaks and valleys of these kinds of projects moving through the firm."
Architects must also be very familiar with multiple regulatory codes and the liabilities of a licensed environment. Because it's self-managed, continuing care isn't quite as litigious as the condo industry, but "there is that aspect to it," Tipton says. "You are being scrutinized by the legal industry for meeting legal requirements for getting these things financed, so you have to be able to work your way through the HUD process or tax-exempt bond financing."
The projects' finances are tightly controlled, and their cost-sensitivity can be a blind spot. Tipton notes that a good deal of value engineering goes on, and massaging the costs can require a major reversal of decisions made earlier regarding systems or the size of the project. And there is much tangential work beyond basic services, such as getting through zoning and site planning review, a process that varies greatly from jurisdiction to jurisdiction.
When structuring a fee, graphics services must also be identified. As marketing strategies evolve to appeal to the next generation of retirees, Tipton says, an increasing amount of material is being required, from scale models to professional renderings. Often, the architect is asked to participate in presentations to prospective residents. All of this, Tipton points out, is time-consuming.
In the past, continuing-care retirement communities have been less profitable than the other types of projects Tipton's firm takes on. But he expects that to change as clients get savvier about the relationship between fees and services received. "We're very thoughtful about the work that's required, and use that to negotiate the fee," he says. "We're working off years of experience to educate the owner."
To tweak Ikea's slogan: It's a big market, someone's got to serve it. Architects are entering the gray areas selectively and through various means. Designing an age-targeted community for WCI Communities gave JBZ Architecture + Planning, Newport Beach, Calif., an entree into some assisted-living projects. The firm is currently working on one in Corona del Mar, Calif., with a small builder. "We've limited ourselves to doing high-end projects because the major assisted-living builders seem to use a formula approach," says Don Jacobs, AIA. "We like a customized approach, almost like working on a boutique hotel."
Having spent several years doing research through the Internet, conferences, and trade publications, JH+P takes the initiative to educate its clients. "We like to work as a team with our clients," Harwick says. "When we do research and development on our own, without fee or compensation, they appreciate that we have the information and will share it, especially if they're not in that market now. Usually we do design sketches and studies, looking at costs of projects to give them a feel for what their investment might be."
By traveling to see award-winning projects, the firm absorbs the best ideas. Recently, Harwick flew to California to review a project that won an award from the NAHB Seniors Housing Council. "It's beneficial to go on site, talk to the people who run the project, find out what works and what doesn't, and walk the project myself to figure out why it won this award," he says. "You learn things you wouldn't have learned through a magazine. It's worth the time and expense."
Developer Noel Khalil, a partner with Atlanta-based Columbia Residential, is a longtime business associate of JH+P's. He looks for architects who can put together a strong elevation and a cost-effective floor plan, give a competitive price, and present the product in a way that excites the customer. He says that on the Atlanta project, JH+P had done their homework on universal-design issues, such as the ideal height for doorknobs and electrical switches, and how to designate a higher number of handicapped units for the first floor. And the proposed building's presentation was strong. "When prospective residents drive up, they see the fitness center from the exterior through a lot of glass," Khalil says. "It's how you position the amenities in the project that creates the sizzle."
Over the next 25 years, as the baby-boom stragglers settle into their last residences, marketing experts will have plenty to say about this discriminating, evolving, and endlessly studied part of the population. And architects will be paying attention. "The seniors market won't go away," says Evans. "It's just a matter of asking ourselves what we want to participate in. When the developers come to us, we can apply all of our talents--land planning, architecture, landscape architecture. We can flex our muscles and use all our power in the firm."
Cheryl Weber is a contributing writer in Severna Park, Md.
who's who in the seniors housing industry Participating in industry events gives architecture firms exposure to the big guns and the best ideas. Check out these professional associations and their Web sites to receive information on major conferences, award-winning designs, newsletters, and the latest market trends.
AIA Design for Aging Knowledge Community, Washington, D.C., 202.626.7300; www.aia.org
American Association of Homes and Services for Aging, Washington, D.C., 202.783.2242; www.aahsa.com
Assisted Living Federation of America, Fairfax, Va., 703.691.8100; www.alfa.com
NAHB Seniors Housing Council, Washington, D.C., 202.822.0200; www.nahb.org
Urban Land Institute, Washington, D.C., 202.624.7000; www.uli.org