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Fitness Centers, Outdoor Spaces and Units All Becoming Larger, Say Seniors Housing Development Panelists

Pictured from left to right are David Kliewer of Grandbridge Real Estate Capital, Michael Hartman of Capitol Seniors Housing, Scott Gensler of Erickson Senior Living, Alan Moise of Thrive and Janet Meyer of BCT Design Group. The speakers made up the development panel at InterFace Seniors Housing Southeast.

ATLANTA — Driven by the desire of a healthy lifestyle, two areas that senior living developers are currently focusing on are the fitness center and outdoor spaces, according to Scott Gensler, vice president of business development with Erickson Senior Living. “Every time I look at a plan, the fitness center gets bigger and bigger and bigger,” said Gensler. “Then we open it, and it’s still not big enough.”

Not only is the fitness center becoming larger, but it’s also becoming more of a prominent feature in Erickson’s continuing care retirement communities.

Additionally, the outdoor spaces have gone from a secondary focus to a primary emphasis. As Gensler put it, having healthy residents is a win-win situation.

Gensler’s comments came during “The Development Outlook” panel at the eighth annual InterFace Seniors Housing Southeast conference, which took place at Atlanta’s Westin Buckhead on Wednesday, Aug. 18 and drew 250 registrants.

Joining Gensler on the panel were Michael Hartman, principal of Capitol Seniors Housing’s active adult platform; Alan Moise, chief investment officer of Thrive; and Janet Meyer, principal with BCT Design Group. David Kliewer, director with Grandbridge Real Estate Capital, moderated the discussion.

Another development trend today is multi-function space, which increases efficiencies. For instance, a catering room can transition into a pickleball court.

Panelists devoted a lot of their discussion to unit sizes and configurations. Hartman said that his firm is developing lots of small units and lots of big units, but not many sizes in between for its active adult communities. The resident profile supports this model.

“There are residents who are willing to sacrifice size of unit for a lower price point. But there are other people in the market who have sold their house, so they want the biggest unit and they don’t care about cost,” said Hartman.

“The smallest unit size keeps getting larger,” said Gensler in reference to the independent living sector. “We may say we’re building bigger units, but we’re actually just eliminating the smaller ones. By default, the average gets bigger.”

Independent living residents are typically not willing to purchase a unit less than 800 square feet, according to Gensler.

While the trend of larger units has gained momentum over the last six or seven years, there’s an even greater emphasis on the unit today because of COVID-19 and the isolation of residents that occurred as a result, asserted Moise.

“There’s awareness now about the possibility of a pandemic and the need to isolate. It’s changed the psychology around the unit.”

Meyer stressed the importance of designing a unit as more than just a box. Features like entryways, foyers and desk spaces are increasingly desired. “When you add different features and try to create separation of spaces within a unit, ultimately it does require more square feet,” she said.

Do your research

 Panelists also shared some of their best practices for site selection and market research. They emphasized the importance of building relationships, understanding the market and being transparent.

“As it’s always been, it’s really more of an art than a science,” added Moise. “You really have to roll up your sleeves and understand the market at an in-person level. You have to build relationships with people that have been in the market over the last two to three years to truly understand the dynamics.”

Moise said his firm performs its own market research, but that is just the first step. “The data can tell you not to go into a market usually, but it can’t tell you to go into a market,” he said. “After that first pass, we’re adapting our analysis to that submarket. It’s not a one-size-fits-all approach.”

Combing through market studies, demographic analysis, inventory counts, occupancy trends and the NIC MAP data are all standard protocols, but they’re mostly about checking the boxes, said Gensler.

“It’s more about understanding your particular site and how your site stacks up against where the other options are for qualified households in this marketplace,” he said. “To really understand that, it requires intelligence onsite, people who know the market and talking to consumers, which is a little more challenging in this COVID environment.”

Gensler cited consumer perception studies and onsite seminars as some examples of gauging the opinions of locals in the area. At the end of the day, the decision to develop a certain site is based more on the “onsite face-to-face experience than on any of the paper analysis.”

Panelists also discussed the importance of transparency when visiting existing communities for research purposes. “We dropped the act when we walk into buildings,” said Moise. “I hate shadow shopping; I always have.”

“Full transparency is definitely the way to go,” echoed Gensler. “You get more information when people understand what you’re looking for and they understand you’re coming to the market. They want to know about your product too, so it’s a two-way street. People are generally open in our industry, and if they’re not, that often tells you something about the market.”

— Kristin Hiller

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