Paradise Village Seniors Housing Project Forges on Despite the Challenging Economy

By Lisa Iannucci, Contributing EditorSan Diego—It’s been a difficult few years for the housing market and the economy, especially in California. Many residents have lost jobs, homes and a large chunk of their retirement plans due to the faltering economy. It might sound like a logical business decision to put any new projects on hold. But Generations LLC, the development company that’s building Paradise Village, a $130 million, 497-unit independent living senior retirement community just south of the San Diego city limit, disagrees.Portland, Oregon-based Generations LLC is forging ahead with its project, excited about what the new development will bring to the area. Paradise Village began about four years ago as a joint venture project between Generations LLC and Adventist Health Systems-West, a company that operates health care facilities throughout California, Hawaii, Oregon and Washington.“We were excited about being asked about this project,” says Chip Gabriel, president of Generations LLC. “There is a lack of senior rental housing in this area; so, because of the type of project it is, its price point and its amenities, we know there’s a market for it.”  Generations LLC broke ground a year ago on the 12-acre gated mixed-use community and the project will be completed this summer. It will feature 406 retirement residences and 92 assisted living residences, as well as many amenities, including a pool, amphitheater, movie theater, fitness center, tennis courts, 18-hold putting green, walking trails, gardening areas, restaurant, hair salon, chapel, credit union and concierge services.The monthly rental fee for a standard one-bedroom unit, from 718 to 752 sq ft, is $2,862; a one-bedroom plus den, from 868 to 912 sq ft is $3,286; a two-bedroom, from 1137 to 1142 sq ft is $3,922; a penthouses (from 1148 to 2011 sq ft is $4,100 to $5,990. The monthly rental fees for the assisted living units start at $3100 for a 448-square-foot studio to $4,900 for a two-bedroom, 83- square-foot unit.In today’s economic climate, these fees might seem a little high-end for the senior community, but Gabriel says that Paradise Village will of special interest to retired seniors mainly because of the rental rates.“We’re very fortunate that we’re a rental community without an equity buy in,” says Gabriel. “We also bundle services so when the residents move in, their rent will include all utilities, phone, health club, activities, a $150 credit to the restaurants, property taxes, etc. It’s all included, so it’s more cost-effective. It’s more affordable for them to live with us than to live on their own and have to pay for maintaining their home. And all leases can be broken with a 30-day notice, so if it’s not a lifestyle they want, they can choose to give us 30-day notice and move out without any loss.”Gabriel also explains that rents do not increase more than the Social Security increase every year. The community is estimated to bring in more than $130 million dollars to the local economy, as well as provide employment for several hundred employees. The potential residents for this community not only come from the local California area, but Lewis McCoy, VP of Generations LLC says that they are getting calls from other people throughout the country. ““San Diego is a favored place to relocate and retire to in this nation because of its idyllic weather,” says McCoy. “Seniors would prefer not to stay in areas that are 20 degrees in the wintertime. It makes them homebound.”  Units will be outfitted with Energy Star light fixtures and appliances, as well as dimmer switches and motion sensors to ensure that electric usage can be reduced. The developer is also using green Ecotex fabrics, which are sustainable fabrics that are being used on the community furniture. The entire project’s construction was financed through Prudential Mortgage company via a fixed-rate construction to permanent loan with an interest-only fixed rate. “We paid a little premium, but there wasn’t any difficulty getting financing in California for a senior project.“Gabriel explains that there were only a few obstacles in the approval process.“The biggest obstacles were the size of our project, which was a concern to council members, and the environmental review which is long, painful and expensive to go through. In addition, the county and cities have dramatically increased their impact and permit fees. For a project like ours, you could be looking at an extra million dollars in fees.”