This week we’ve discussed various reports and acquisitions that demonstrate the robustness of the senior living market. In addition to these items, another measure of the market’s health is construction activity. A high rate of construction activity relative to previous years would indicate that demand for seniors housing is strong and providers are doing their best to meet it. According to a number of economic and real estate reports that have been released recently, the extreme weather conditions that the country experienced during the winter dampened construction activity in many states. But now that these conditions have largely passed, activity has begun to pick up in a number of different markets.
For example, in Mounds View, Minnesota, construction has begun on a new $14 million, 105,000 square foot, 97-unit senior living community that will include assisted living, independent living, and memory care apartments. The project is being led by Bel Rae Senior Living which has touted a number of attractive features that the facility will have, such as advanced monitoring and reporting technologies, a high-end restaurant quality dining room, overnight guest rooms, and underground parking. To help meet the care needs of its residents the facility will also have onsite visits by nurse practitioners and geriatric physicians, and a full-time nurse who will be on call 24 hours a day. Bel Rae is extremely excited about this project because of these features and the high level of demand for senior housing in the area, and it expects construction to be complete by March 2015.
Meanwhile, in an effort to meet growing demand in the Atlanta area, Dominion Partners has decided to expand its Somerby of Peachtree City facility which is located just outside the city. Somerby of Peachtree City is one of five Somerby facilities in Dominion’s senior living portfolio and just opened last year. Demand in the area is so great that Dominion now plans to build an additional 12 villas and 100 independent living apartments on a 13-acre site that is adjacent to the existing facility. The estimated cost of this addition is $25 million and Dominion expects to break ground on it this summer. In addition to its Somerby of Peachtree expansion, Dominion is also keeping busy by building a new facility in Florida. The company just broke ground on a $13.8 million senior living community located in the Florida Panhandle that is called Somerby at Santa Rosa. Somerby at Santa Rosa will be the sixth Somerby senior living property and will house 52 assisted living apartments and 24 memory care apartments. Amenities will include wellness areas, a medical clinic, a fitness center, hydrotherapy and aerobic pools, and physical therapy facilities as well. Dominion is extremely excited about these two projects and plans to build additional Somerby communities in Nashville and Georgia in the future. Lastly, to meet additional demand in Hawaii, the Honolulu based provider, Plaza Assisted Living, recently began construction on a new assisted living facility in Waikiki. This will be the Plaza’s fifth property and will be located on the site of the former PBS Hawaii building.
These construction projects provide additional evidence of the strength of the senior housing market. The pace of construction is also likely to increase now that winter is officially over and a number of developers are looking to take advantage of today’s low interest rates before they increase in the future. Senior living providers and others who are interested in obtaining capital for development or other reasons should continue to look to the successful financing firm Cambridge Realty Capital and its many different financing programs for assistance in financing these projects and their other needs as well.