For a lot of us working in or serving the senior living field, the present feels eerily familiar. Every time there is a significant falter in the economy, we wonder, “How will this affect my business?”
The recession in 2008 was quite a hit to the senior living industry. Not only were economic markets down, but the bubble bursting on the real-estate market was like a one-two punch for new sales at independent living and continuing care retirement communities.
Similarly, as we find our “new normal” in the age of the coronavirus, we’ll be faced with a consumer who not only likely took some market-based financial loses but who also has become a cautious consumer of healthcare services. So where do we go from here?
We’re all looking for some crystal ball into the future. I wish I had one. What I do have, however, is a background in retail-buyer behavior and forecasting design trends for senior living. Drawing from this knowledge, here are some thoughts on what it may look like for us as we begin the long road back from this crisis.
Middle-market communities will be appealing.
We’ve been talking about the needs of the middle market for years. The new reality will bring these needs into focus even more.
For many Americans, dropping half a million dollars on an entrance fee simply isn’t an option, nor is a monthly rent of $7,500 or more. Certainly, a market still exists to serve upscale consumers (see below), but for those folks who have worked their whole lives toward the goal of retirement, the pandemic likely has affected their financial position as well as their comfort in parting with the dollars they still have left. Communities that offer senior housing options that are affordable while still providing access to limited lifestyle amenities will appeal to this consumer.
Older adults will find value in being a part of a healthcare system.
Again, it isn’t a new idea, but living in a community that is a part of a larger healthcare system likely has gained importance for consumers looking to join a new community.
How close of an alliance you make with a healthcare network is up to you. In some cases, simply locating your community close to hospitals and medical offices may be enough. Other consumers may want communities that are tied into a larger network of providers to which they will have priority access.
Whichever approach you take, strategically associating and marketing those associations will increase prospective residents’ comfort levels when deciding to make the move.
Upscale consumers will be looking for a ‘wow’ factor to make the leap.
Upscale consumers often have the luxury of being able to make a decision to move based “want” rather than “need.” Such prospective residents will be especially discerning in the aftermath of the pandemic. The desire to join a community will still abide, but they will be looking specifically for a community that suits their lifestyle.
I foresee appealing offerings as being more active adult or resort-style living, with small-footprint buildings featuring underground parking, limited units and large, residential-style units.
The upside of being a part of a larger community or health system still will drive some of the decision-making for upscale consumers (see comments above), but the need for some additional “social distance” in small buildings with only 12 to 24 units will offer a comfort to people who now are uneasy with the idea of living in a large complex. In the end, such residents will be looking for a community that offers the domestic “comforts of home” with all the wellness-based amenities that we have come to expect from top-tier communities.