Location is one of the key factors in determining the success of a senior housing project. Cambridge Realty Capital understands that choosing the right location sometimes feels more like magic than science but there are some techniques that can be used to maximize the likelihood of a successful decision.
Don’t Reinvent the Wheel
There is a natural tendency to want to be ahead of the curve, discovering and benefiting from development of senior housing and facilities where no one else is yet in the market. The reality, however, is that trying to be the first can be risky business. Predictions can be inaccurate and things can change, quickly. Think back to 2008 and all of the housing projects (of all kinds) that were abandoned because purchasers were no longer able to follow through and prospective new purchasers backed off.
The benefit of choosing areas that are well-established senior markets is that seniors are already living or looking at those locations, so you can focus on selling the advantages of your development and facility over others rather than also having to sell the advantages of a new location.
Check Migration Data
Of course, senior housing hot spots change, but they don’t change overnight. As aptly discussed in a recentSenior Housing News article, checking migration data can help you identify trends in where seniors are moving to, or from. Migration data shows you the number of individuals that move to or from a given area over a period of time. For senior housing, migration patterns of seniors can provide invaluable insight.
The numbers sometimes contradict anecdotal theories about the movements of seniors. For example, it has often been said that those over 75+ don’t move frequently, but migration data shows this isn’t necessarily true. Over the past ten years, Austin, Texas and Portland, Oregon have seen high net migration rates of this population, meaning more seniors of this age group were moving into these areas than out of them.
Closely related to the question of where seniors are moving is the question of why. Sometimes the why can explain the where. For example, about 20% of seniors 65+ cited a need to find cheaper housing as a reason for moving; thus, markets where land is more affordable may be good options for building housing and facilities attractive to this demographic.
In other cases, the why may provide information regarding how to make housing and facilities more attractive to target market seniors. For example, 30% of those in the 85+ demographic cited health reasons as the basis for their decision to move. Thus, in choosing a facility, they are likely to provide great weight to the perceived ability of a facility to provide for their physical and mental well being.
Invested in Your Success
As providers of real estate finance for senior housing and facilities, Cambridge Realty Capital is literally invested in your success and dedicated to helping you make the most informed, profitable deals and business decisions possible.