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It’s no secret that the 75-and-older population is growing. But a new senior living and care trends report notes that with that growth comes more households with a net worth of $1 million or more, suggesting a future market for entrance-fee life plan communities.
The third edition of Love & Co.’s 2021 Seniors Housing Trends report provides insights into the future of senior living and care — including design, development and financing, staffing challenges, health and wellness programs, marketing and sales, and revenue — from company thought leaders.
Along with the growing number of high net worth households, there will be more than twice the number of households with assets in the middle-market range, providing “abundant opportunity” for development, they said.
“This is probably one reason that consumers have greater concern about monthly fees than entrance fees in life plan communities: their assets are stronger than their incomes,” the report reads. The trends suggest continued opportunities for entrance-fee life plan communities (also known as continuing care retirement communities, or CCRCs) and “very strong demand” for middle-market options, according to the document.
Wellness
One of the greatest opportunities — and challenges — the senior living industry faces, according to the report, is moving from a care-based model to a focus on health and wellness.
“With so many competitive alternatives facing the senior living field, life plan communities, in particular, need to adopt a powerful positioning that supports a truly unique value proposition,” the authors noted.
Moorings Park Communities Vice President of Sales and Marketing Tom Mann said that with technology and home- and community-based services providing incentives for older adults to remain in their homes, senior living communities need to develop fully integrated health and wellness programs.
Pearl Creek Advisors Founder and Principal John Franklin said that life plan communities must pivot to tell a more compelling story — a “vitality model” focused on thriving. Such a story, he added, involves investing in technology, providing healthcare navigation services, using data to drive resident engagement, and offering price points and products that appeal to a large market.
“As the industry pivots to this new value proposition, senior living organizations will need to overcome the myths and negative perceptions associated with senior living settings created by the pandemic, by telling a new and compelling story rounded in reality,” Franklin wrote in the report.
Strategic planning
Contract choice, rental and middle-market offerings, healthcare offerings, partnership opportunities and the possibility of joining a larger organization are some of the strategic challenges and decisions senior living organizations will face in the new year, according to the report.
Although the entrance-fee model has been the standard in not-for-profit senior living, today’s upcoming pool of residents prefers the flexibility and freedom found in rental products, said OnePoint Partners Partner Toby Shea.
Affordability and freedom are the top two reasons older adults are attracted to rental communities, he said. Rental communities, Shea added, allow residents to keep their assets liquid and remove perceived restrictions and long-term commitments that come with an entrance-fee contract.
The pandemic, according to the report, also accelerated the move away from skilled nursing, increasing the demand for assisted living, memory care and in-home nursing care. The authors noted that in the post-pandemic world, flexibility is key, and providers should be thinking now about how to meet future residents’ needs and expectations.
Design and technology
The pandemic gave the senior living industry pause in many areas, not the least of which was how their communities are designed and operated, the report authors stated. Technology also became more prominent as the pandemic changed expectations of prospects and residents.
“The community has a responsibility — especially with COVID-19 changing things — to provide safe visitation spaces and make other long-term investments that make the community relevant to prospects,” Perkins Eastman Principal J. David Hoglund wrote. Such investments could include reconfiguring outdoor visitation spaces or adopting a small home model, he said.
OnePoint Partners Partner Mike Kivov said that long-term care is in a “transformative period,” driven by lasting changes in consumer behavior. Right-sizing skilled nursing areas, providing more assisted living services in the home, and the continued need for residential memory care are notable trends, he said.
The report also examined expanding service lines into the greater community — think home- and community-based services and continuing care at home programs — creating a strong staffing and organizational culture, providing social and entertainment amenities, investing in marketing and sales, and committing to diversity, inclusion and equity.
