While some in the senior housing industry say the market has been saturated, others are seeing room to grow. All, though, are waiting for the next big wave of older adults as the baby boomer generation begins to hit retirement.
“We know of at least seven new assisted livings expected to open this year or the very early part of 2018,” said Richard T. Moore, president of the Massachusetts Assisted Living Association.
As the economy has improved since the recession, Moore said that level of new construction is typical.
Assisted living residences provide a combination of housing and personalized support services for those who require help with activities of daily living, according to the association.
There are more than 235 assisted living residences in the commonwealth, according to information from the state’s Executive Office of Elder Affairs.
One of those new constructions will be in Belchertown, where the Grantham Group LLC has plans to build another Christopher Heights location. The 83-unit assisted living facility is expected to open in 2018. The Grantham Group has another Christopher Heights facility in Northampton as well as five other locations.
But Christopher Heights’ executive director said his company is no longer growing as rapidly as it was.
“If all goes great, Belchertown would be opening spring of 2018. Without a doubt, the growth of our company, I think as an industry, has slowed,” Thomas McMullen said. “It was real rapid and now it’s pretty much established, and for the most part, there are assisted living communities serving all areas.”
The company’s growth, according to McMullen, started rapidly with three communities built in about three years from 1997 to 2000.
“And then it slowed down,” he said. “The economy took a change and we weren’t really sure how that would impact us.”
In 2008, construction began once again with a community opening in Marlborough, then three years later in Gardner.
“I think the industry, as a whole, knows that it is only going to grow as the baby boomers continue to grow older,” McMullen said. “I don’t see as many assisted living communities going up as I did 10 years ago, so I think we all kind of realize that it is fairly saturated right now, but the needs are going to grow. I think a lot of it has to do with getting your footprint in place prior to that growth.”
The interest, according to McMullen, has been higher here than in the past.
“The area is competitive but the interest has grown,” he said. “It is an aging society with more and more people getting older. As they age, their needs are going to increase as well.”
At Christopher Heights, about half of the apartments are affordable housing units.
Another trend in the assisted living industry is that individuals tend to move in later in life, coming into communities well into their 80s and beyond. At Christopher Heights in Northampton, the average age is 83, according to McMullen.
With the older population, McMullen and Moore agree that they are coming in with more health issues and thus needing more care than in previous generations.
Citing a statistic from the Pew Research Center, Moore explained that 10,000 people a day in the U.S. turn 65.
“That has been going on for the last two years, and should be going on for the next 18 years before it levels off,” he said.
Not all of them will be moving into assisted living, though, Moore noted, as people try to stay at home as long as they can.
While the population continues to age, Moore said he expects to see more growth in the central and western portions of the state, because the industry tended to be slower-growing than in the eastern, more densely populated areas of the state.
For Realtor Richard Sawicki Jr., of Sawicki Real Estate in Amherst, clients come to him after retiring and looking to simplify their lives. They tend to be families or couples who have lived in the community for a long time and have finally managed to clear their home of the last boomerang child.
For these clients, Sawicki said, condominiums are attractive. There’s no need for maintenance — mowing the lawn, shoveling snow, and in the case of one community even brushing snow off cars is all taken care of for residents.
Sawicki said his clients also turn to senior housing developments because they offer a sense of community.
“They are trying to simplify,” Sawicki said. “A lot of it is downsizing.”
Around 600 residents live across the four locations of Loomis Communities within the Pioneer Valley. A continuing care retirement community, Loomis Communities offers all levels of care, from independent housing to skilled nursing care. AARP defines the communities as “part independent living, part assisted living and part skilled nursing home.”
In his 25 years in the industry, CEO David Scruggs said, he has seen it change drastically, not just in terms of growth but also the age of those who move into retirement communities and what individuals are looking for once they move in.
“These days, they are much more likely to request an arrangement than what is traditionally provided,” Scruggs said.
Whether that be a different layout of a bathroom, or other materials for countertops, residents, and often their children, aren’t afraid to ask.
In the last five years, Scruggs has seen the market change as well.
“When the market was down, you couldn’t get enough small apartments to sell. Now that the market is much better and finances are better for older people, you can’t get enough large apartments,” he said.
Growth in the industry is flat, at least for the moment, according to Scruggs. As the baby boomers continue to age, though, projected growth will be moderate for a while then give way to steep and significant growth before leveling out, Scruggs explained. The growth, he said, mirrors age demographics of the population.
When Scruggs started in the continuing care retirement communities more than two decades ago, he said there were about 1,200 of them run mostly by nonprofits. Today, he said, there are about 2,000.
“It used to be that almost all of them were stand-alone,” he said. “Nowadays, it is much more common for them to be larger organizations, like Loomis (which) has four communities.”
Massachusetts, for its physical size, according to Scruggs, has a fair number of continuing care retirement communities.
The movement of continuing care communities began in Pennsylvania and they tend to follow major cities around the country where there is the necessary critical mass of older adults in the right age category, with the right financial characteristics, according to Scruggs.
Because of those factors, Scruggs said, it’s hard to build in a rural area or a poor area.
The communities, Scruggs said, are a niche market that attracts only 2 percent of older adults.
“When you look at the market of the people who are exactly the right age … and have the financial resources to make a move — if you get 10 to 12 percent of a market in retirement communities that is fairly heavy,” Scruggs said.
“We’re pretty much there in the Pioneer Valley. Loomis is the single largest player in the Pioneer Valley.”
For Lathrop Communities, an independent living senior community, growth is happening now.
Michael Harvey, director of sales and marketing, acknowledged that senior community living is not for everyone, with “a lot of boomers” indicating it is not something they wish to do.
Even so, the reservation list (or waitlist) for a place in the two Lathrop communities is a hot commodity.
“We are and, for a couple of years, have been 100 percent sold or occupied in our town homes,” he said.
With a “healthy and long reservation list,” the company is looking to grow, Harvey said.
“We are expanding,” he said. “We will be increasing the number of residents in both senses — residents and residence.”
Though no specific number has yet been finalized, with two communities and its apartment-style living in Easthampton, Lathrop Communities now has 220 residences.
At Lathrop, as with Loomis, residents pay an entrance fee rather than owning their residence.
At Lathrop, the entrance fee for the town homes begins at $270,000. When the resident moves out, 90 percent of the fee is refunded, either at the time the residence is released to a new occupant or at the end of one year, according to the company. Residences also include a monthly fee ranging from $1,700 to $2,790.
The industry, Harvey said, is largely driven by the wave of boomers currently entering the age of retirement and considering how they will structure and enjoy their retirement years.
“A place like Lathrop cues itself to those people in the boomer population and those a little older, who do choose to live in community, those who do want a place where they can flourish and can continue creating themselves,” he said.
Emily Cutts can be reached at ecutts@gazettenet.com.