Senior Living Business Interactive: Key Strategies For Success During Economic Recovery
It’s a whole new world. Economic recovery may be fragile, but it is happening. Plus, seniors in coming years—and there will be a lot of them—will have new/different ideas about how they want to live and what they expect from a retirement community. Senior living providers must position their organizations to survive and compete in this challenging new environment; but instilling a new approach, whether physical or cultural, doesn’t happen overnight. Providers must listen to seniors—and listen hard—if they expect to meet the coming generation’s expectations.
So what do seniors want from providers? Mostly, they want to maintain their independence. They also want to see a focus on wellness, on healthy aging, on green initiatives, on lifelong learning, on giving back to the community. Just a few years ago, the marketing emphasis for senior living was more lifestyle-driven, with ads showing older people having a wonderful time in their new environment. Today, the emphasis is on security—physical security, the security of knowing that health care will be available, and the security of understanding the cost of that care.
Given these changing—and emerging—marketplace demands, then, what are providers doing to move forward? And on the design side, what fundamental changes are taking place—and need to take place—as we navigate economic recovery? Sitting on the sidelines while the economy shakes out may make sense to some, but a case for growing can be made, even now, across the continuum, according to Brian Schiff, Senior Vice President of Planning and Financial Services at Greystone Communities, Inc. in Irving Texas. And for Greystone’s clients, four specific areas of change have been driving them to take action despite the economy:
1. Compelling demographics. By 2050, one of every five people will be age 65 or older. But from 2010 on, we’ll see not just growth but an acceleration of growth in the population age 65-plus and, more importantly, age 85-plus. Even more significantly, the top third of the market will grow by 25% (from 4.2 million to 5.4 million) by 2020 and another 33% in the following 10 years. (See charts, p. 4.) The cumulative effect is an increase of 3.5 million more age- and income-qualified people that the senior housing market will need to service by 2035. Using the historical 5-10% market penetration rate for this sector, the steep growth curve suggests that the market will require more than 350,000 additional independent living units over the next 20-25 years.
2. Customer demands. Meeting the changing demands of new seniors in terms of what they want, what they need, and how they’ll go about the process while trying to offer the current product to new, younger customers will be a real challenge. Across the continuum, product demand is influenced in a number of ways, but the propensity to choose is often based on the market’s education about and understanding of the product. Certainly, facilities that have been in place for a long period of time (e.g., in Pennsylvania) have a higher market penetration rate than in areas, where the product is relatively unknown (e.g., in Texas)...Want to read more? Click here for a free trial to Senior Living Business and download the current issue today