Why the Future in Senior Housing Is All About Health, Affordability
Two industry experts explore how these qualities will be key to meeting residents’ expectations.
As Baby Boomers and Gen Xers continue to transition into their retirement years and beyond, demand for senior housing is skyrocketing. These older generations are increasingly prioritizing health and wellness in their living environments, which presents a significant opportunity for both investors and developers today to cater to this growing demographic group.
With more than 60 percent of Gen Xers and Baby Boomers having chronic conditions like diabetes, heart diseases and depression, there is a pressing need for housing that supports physical activity, social interaction and access to healthy food, according to Joanna Frank, the CEO of the Center for Active Design.
And as older generations move to more affordable regions—but prone to extreme weather events and poor air quality—health-optimized homes become critical, particularly as having a roof over one’s head can create pathways to better health outcomes, Affordable Homes & Communities President & CEO Paul Bernard told Multi-Housing News.
We talked to Frank and Bernard about the most sought-after features of senior housing developments today, and the elements that will be key to the future of senior housing.
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What health and wellness features do senior housing communities need to prioritize to meet Baby Boomers and Gen Xers’ expectations?
Frank: Health-promoting senior housing communities are prioritizing evidence-based strategies from the Fitwel standard that specifically address the health needs of their population such as the climate and proximity to local amenities.
For chronic disease prevention, these strategies include features that promote physical activity, access to healthy food and encourage social interaction—with loneliness presenting as great a threat to life expectancy as smoking. These strategies also include creating or sitting homes in a walkable environment with sidewalks, street furniture, street trees, areas for social engagement, access to parks and amenities within a 10-minute walk. Strategies shown to mitigate stress and anxiety include homes with natural light, gardens with biodiverse plantings and management policies that prioritize maintenance, strong communication and emergency preparedness plans.
Additionally, housing preferences among Gen Xers and Baby Boomers include single-level homes, low maintenance living, safety features such as street lighting, environmental sustainability and accessibility…
As a Fitwel operator, what can you tell us about the specific features that address the health concerns of today’s older adults?
Frank: Several Fitwel strategies address the specific health concerns for older adults while having tangible impact on value. These strategies include site access with universally accessible bike parking located near bike lanes for employee commuting, safe street infrastructure for pedestrians, street furniture and amenities at transit stops, pavements and streetscapes, efficient parking practices. They also include shared spaces by adding full-service dining, fitness centers, common activity rooms, accessible common restrooms, indoor walking paths, best practices in corridor design, lighting design, and wayfinding; and lastly, outdoor spaces with therapeutic gardens, fruit and vegetable gardens, walking trails, biodiversity and rooms with views of nature.
To what extent can design effectively contribute to integrating affordability and health in senior housing projects in the current high-cost environment?
Frank: There are three main demand drivers for senior housing: affordability, climate change and health. The good news is that there are several design strategies that meet all of these determinants—including adaptation of existing properties that include health-promoting features—and policies do not need to be capital intensive to be effective. Some of the most effective strategies are policies that use best practices in maintenance, pest management, wayfinding and creating green spaces. These are low cost and contained in operational budgets.
Other strategies, like using light-colored paving and roofing materials, have a net positive impact on operating costs by reducing energy costs associated with mechanical cooling.
Other affordability considerations are on the cost for tenants to operate their homes. These can be controlled by using low-maintenance, low-cost design features such as LED lighting, non-slip flooring, and by prioritizing design that reduces energy use through natural lighting, operable windows and passive cooling such as shade trees, exterior louvers and cross ventilation.
Please expand on the climate change element and its impact on senior housing development.
Frank: As an industry, commercial real estate is responsible for about 30 percent of carbon emissions. We now need to both minimize our impact on climate change by limiting carbon emissions, at the same time as adapt our built environment to maintain the quality of life of our residents. There are practicable, actionable strategies we can employ to mitigate environmental impact and enhance resilience. We know that the business of real estate is based on responding to the needs of society, and today, the pressing need is how to adequately adapt to climate change.
The true costs of climate change can only be understood when looking through a public health lens and, going forward, we know that the real estate industry must prioritize the reduction of carbon emissions while adapting our built environment to be resilient to climate change’s many threats. This isn’t unique just for senior housing developments, however. Adaptation will not only save untold lives, but also mitigate the most severe financial risks to the industry.
What do you think will shape senior housing over the next decade?
Frank: Longevity. The life expectancy of Gen X is 85, taking this population beyond the 1.5°C increase in global temperature by 2050, compared to Baby Boomers whose life expectancy is 70. At the same time, we are going to see more of the population being affected by extreme weather and dealing with affordability issues. It is predicted that in three decades, more than 100 million Americans will live in an ‘extreme heat belt’ where at least one day per year, the heat index temperature will exceed 125°F.
Meanwhile, Gen X is the first generation to retire since moving away from private pensions to 401Ks, with the National Institute on Retirement Security finding that the average retirement savings for Gen X is $40,000. Between all these factors, Gen X tenants are more health conscious and more environmentally conscious, driving demand for senior housing properties that are affordable and cater to health needs.
How is AHC addressing seniors’ financial constraints to ensure they have access to affordable housing options?
Bernard: As part of our broader mission to support seniors aging in place, we have been reviewing the World Health Organization’s age-friendly cities and communities guide. This review helps us evaluate and enhance the services we provide to our residents, focusing on creating environments that support their needs as they age.
One notable example of our efforts is the development of the Health & Wellness suite and additional health services at MonteVerde Apartments in Baltimore. This initiative was specifically designed to address the critical health-care needs of our senior residents, many of whom face significant financial challenges.
With the support of the Enterprise Thome Aging Well grant, we have been able to cover expenses not covered by insurance, ensuring that our residents have access to essential medical treatment without having to make dangerous choices between health care, medication, food and living expenses. These services are crucial in preventing the financial strain associated with out-of-pocket health-care expenses.
READ ALSO: Maintaining Senior Residents’ Satisfaction When Expenses Increase
What legislative or regulatory changes would most benefit your efforts in creating sustainable and affordable housing for seniors?
Bernard: In the U.S., we have a lack of affordable housing across all age groups, but as seniors are particularly vulnerable, we need to ensure we pay special attention to increasing the supply of affordable housing for 55+ communities. To do this, policymakers need to find ways to streamline development and increase subsidies for affordable housing development and preservation.
Policymakers should be increasing low-income housing tax credits and loosening restrictions to fund more affordable units. The Low-Income Housing Tax Credit (LIHTC) Program right now offer 9 percent tax credits primarily used for new builds and 4 percent primarily for preservation, retrofits and adaptive reuse. The latter costs about 50 percent less than new builds, so if we can increase priority for preservation using tax credits, that could ultimately provide more dollars and more opportunities to create additional affordable housing for seniors.
Tell us more about the process of convincing owners/developers to adopt healthy building practices over time.
Frank: Owners and developers are convinced once they are presented with the data. The pandemic increased demand from both tenants and investors for healthy buildings, and now we can substantiate the impact health-promoting strategies have on the financial performance of assets. This insight is the result of our extensive analysis of the evidence base showing the correlation between a people-focused approach to the built environment and financial performance metrics including return on investment, net operating costs and climate-related risk. Investors now see promoting occupant health tied to value, because tenants are demanding health and are willing to pay more for it.
What are some best practice solutions when it comes to integrating health-care facilities into senior housing developments?
Bernard: The key to creating effective health-care facilities and programs for senior housing developments is securing strong partners who can deliver quality health care to residents. We seek out partners we know can deliver the expertise and quality services that our residents deserve, which is especially important when dealing with health care for senior communities. Additionally, no two communities are alike and therefore there is no one-size-fits-all solution. We understand every community has unique health needs, and so we tailor our services and programs to be most effective.
Can you provide examples of successful projects where combining health care and housing resulted in increased demand?
Bernard: Integrating health care and housing has proven to be an effective strategy in addressing the needs of vulnerable populations and improving overall community health. Several successful projects have demonstrated increased demand and positive outcomes by combining these services.
For example, the New York Medicaid Redesign Team Supportive Housing Initiative has significantly increased access to supportive housing for vulnerable populations. This program showed that providing stable housing, coupled with health care services, led to improved health outcomes and reduced Medicaid costs. The initiative used Medicaid savings to fund supportive housing projects, creating a sustainable model that benefitted both health and housing sectors​.
In Houston, the Integrated Care for the Chronically Homeless program has demonstrated similar success. This initiative focused on individuals experiencing chronic homelessness, integrating housing with comprehensive health services. The program resulted in increased physical and mental health functioning, decreased depression, and reductions in emergency department usage among participants. These positive outcomes attracted additional funding and support from local Managed Care Organizations, showcasing the demand for senior housing and sustainability of such integrated care models​​.
These examples illustrate how integrating health care and housing can lead to increased demand, better health outcomes and cost savings. They underscore the importance of collaboration between health and housing providers, careful planning, and securing diverse funding sources to ensure the sustainability of such initiatives.
What types of health-care services are offered onsite at your MonteVerde Apartments community? And how are these services tailored to meet the specific health concerns of the senior population?
Bernard: At MonteVerde, National Capital Treatment & Recovery uses the space to support residents who are dealing with substance abuse issues. They provide a range of services including assessment, outpatient treatment, medication-assisted treatment, cognitive behavioral therapy, 12-step program facilitation, and trauma-informed treatment—all provided onsite for the convenience and direct support of the residents.
These services and programs were designed with the Baltimore senior community in mind: In Baltimore, while senior Black men account for just 7 percent of Baltimore’s population, they account for about 30 percent of the city’s drug-related deaths. This is unacceptable—the MonteVerde community is proof that affordable housing can be more than a place to live, it can create pathways to better health outcomes.
What feedback have you received from residents at MonteVerde Apartments, and how has it informed your other projects?
Bernard: We have received overwhelmingly positive feedback from residents at MonteVerde Apartments regarding the Health & Wellness suite. Initially, we anticipated a slow start given the sensitive nature of the topics such as substance abuse treatment and mental health support. However, our residents were eager to start treatment as soon as we completed the necessary state licensing with our partner. This enthusiasm was a pleasant surprise and has led to active participation in both monthly group therapy sessions and one-on-one work with clinicians.
Residents have expressed gratitude for the accessibility and quality of care provided onsite. They appreciate the convenience of having these critical services within their community, eliminating the need to travel and navigate external health-care systems. This has significantly reduced barriers to receiving treatment and support, resulting in better health outcomes and improved quality of life for our residents.
The positive feedback from MonteVerde has informed and inspired our approach to other health services across AHC communities. Specifically, it has highlighted the importance of accessibility of services, holistic care, community engagement, and securing strong partnerships and funding.
Based on the success and feedback from MonteVerde, we are looking to replicate and adapt this model in other AHC communities. This includes expanding the range of onsite services and continuing to engage residents in meaningful ways to ensure their needs are met effectively. By doing so, we aim to support more seniors in aging with dignity and grace within their communities.
