Defining Active Adult Communities – Notes from the Interface Conference

Last month we wrote about how The Senior Housing Evolution Continues, specifically discussing the Active Adult concept. Last week, The Douglas Company attended an Active Adult conference hosted by Interface, where we heard from pioneers and visionary leaders in this new product. Three major conceptual questions stood out through all the sessions:

How to Define Active Adult?

While there is huge excitement about the space, there isn’t a clear-cut, one-size-fits-all definition of what an “Active Adult” community really is, or for that matter, if the term “Active Adult” is going to stick. While time will probably resolve these issues, there is consensus on the place in the market – Seniors in their early 70s want to take advantage of the equity in their homes and sell them to downsize in an effort to reduce maintenance and find a new social circle. This is want-based, not need-based like other senior housing products, and there is definitely a want for it – Some surveys showing nearly 30% of their senior population being interested in these offerings. Many believe that simply by being age-restricted communities, they afford higher rents that newly cash-flush home sellers will be able to pay.

To Amenitize or Not?

Probably the most highly-debated question was what the amenity spaces in Active Adult look like. Some developers believe the absolute key is a robust amenity space like a clubhouse with a pool, fitness space, meeting/game rooms, etc. Others said the rents don’t work to pay for these spaces, and instead, they should be located in areas where there is ample access to amenities provided by the community already. There were success stories of both extremes. One thing is clear – The facilities need to provide convenient access to things seniors want to do, but it seems regional needs will differ on whether or not extra-curricular spaces are part of the development.

Who Builds and Who Finances?

Are these specialized multifamily facilities or simplified senior living facilities? The answer is both, which makes it unclear who is best positioned to move into this space – Multifamily Developers or Senior Living Developers. Both were represented at Interface and have talked about their success in doing so. There are marketing and building cost parallels to what Multifamily Developers are already used to, but there are also operational requirements that are more robust than a traditional apartment building. Senior Living Developers will be familiar with the demographics and their needs but need to learn a more simplified unit and floor plan and understand different needs of a younger senior group than they are used to.

While the answers to these questions might not be clear today, one thing is: Active Adult is more than just a new idea; it is gaining a lot of traction. We often talk about it as a “new” product, but some developers at Interface have had communities like these since the early 2010s. At The Douglas Company, we have seen quite a few opportunities come in for these this year and expect to talk more with both the Multifamily and Senior Living developers we work with about opportunities to build Active Adult facilities soon.

Bruce Douglas

Director of Preconstruction Services 

The Douglas Company

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