Some foreign countries have taken groundbreaking approaches to seniors housing, from innovative memory care concepts to large-scale luxury communities capitalizing on economies of scale.
By Jeff Shaw
Although private-pay seniors housing may be considered a niche asset class in the United States, it features a scale, maturity and sophistication that far outpaces the industry in other countries.
But that scale means that parts of the industry are standardized. Innovations are happening in other parts of the world that still have fresh eyes for this type of housing — innovations that American investors could potentially bring back to the United States to improve operations here.
As more and more American developers export U.S.-style seniors housing to other countries, what are some of the lessons they might bring back to our shores?
The Dutch revolutionize memory care
In the small city of Weesp, Netherlands, just southeast of Amsterdam, there’s a specially designed dementia village named The Hogeweyk that is serving as inspiration for a new way of handling memory care.
Unlike the locked-down, institutionalized secured memory care wings the industry is all too familiar with, those living at The Hogeweyk have their own apartments, with units grouped together by shared interests and the residents free to move around the property. While monitored by staff for safety, the feel is a far cry from what we think of as memory care in the United States.
“The traditional nursing home has been deinstitutionalized, transformed and normalized,” according to the community’s website. “The Hogeweyk is just like any other neighborhood — a neighborhood that is part of the broader society in the town of Weesp. In The Hogeweyk, you will find houses where people live together based on similar lifestyles. They can visit the pub, restaurant, theater, supermarket or one of the many offered clubs. The concept supports unique needs, lifestyles and personal preferences.
“Living in The Hogeweyk puts boredom, loneliness and hopelessness in another perspective. It focuses on possibilities, not on disabilities. And it goes without saying that this is all supported by trained professionals.”
Design firm Perkins Eastman has worked on seniors housing projects all over the world, but this would be the first design concept the company is trying to bring to the United States from elsewhere. Although currently on hold due to the cost of construction and capital markets disruption, Perkins Eastman has designed Avandell in Holmdel, New Jersey, based on the Hogeweyk model.
“There’s a lot of interest in some of the new models of dementia care, and the Dutch in particular have been pioneers,” says Brad Perkins, chairman and co-founder of Perkins Eastman. “It’s a very attractive, smaller campus. Everybody has their own front door. Units are even more home-like than most of the ones we’ve been able to achieve. I was very impressed. Some of our clients have been interested in the model.”
Both The New York Times and National Geographic have written about the new model. Unfortunately, the biggest challenge is the cost.
“Construction costs [in other countries] are a fraction of most of where we work in North America,” says Perkins. “Trying to do senior living in an urban setting in any major city is tough, largely due to land prices. Senior living does not generate the returns that other competing land uses generates — particularly luxury housing.”
In a similar story from a different part of the world, Belmont Village Senior Living developed its new memory care program at its sole international location, which is located in Mexico City.
“To work across borders successfully, it’s vital to understand the cultural, legal and operational (cost and otherwise) differences so business models can be adapted accordingly,” says Mercedes Kerr, president of Belmont Village. “Having said this, there are many aspects of what we do which are universal and can benefit all seniors, regardless of language and background.”
Kerr notes that she also hopes to translate the community’s extremely active dining space back to the United States.
“The dining experience is wonderful to behold, especially on weekends. Our dining venues are often full, with multiple generations sitting around large tables for long lunches while visiting loved ones. Separately, the service culture exhibited by our team in Mexico is unmatched and something we celebrate and study.”
The quest to be like Quebec
Cogir Senior Living has been in the news quite a bit in recent years. The Montreal-based company launched its U.S. branch in 2018, and in 2022 bought Cadence Living to dramatically grow its U.S. portfolio to 61 communities. The company focuses on all types of private-pay seniors housing.
But long before Cogir entered the U.S. market, the company was known for its luxury seniors housing communities in its native Quebec.
Perhaps the first feature that most distinguishes Cogir from the competition is the sheer size of its projects. The average Cogir community in Quebec is 285 units, and some are as large as 850 units, according to Benjamin Demelin, regional director of operation, and Yves Duguay, senior vice president of operation.
“We have more economies of scale,” says Duguay. “You can have a pharmacy, convenience stores, many services inside the community. More amenities means more efficiency. You can also have more volunteers and more spirit of community.”
Other services available within the community include vehicle services such as tire changes, which encourage residents to stay active and retain their ability to drive.
While smaller communities come with less risk (and lower development costs), the two Cogir executives believe it ultimately hurts the sense of community.
“In Ontario and the United States, they don’t use the space as efficiently. It always looks empty,” says Demelin. “But if you put 300 people in the same place, you are going to feel the community. It becomes a small village.”
Layout also plays a key role in creating a unified community, according to Demelin. At Cogir properties in Quebec, both the offices and amenities are placed at the front near the entrance.
“The amenities are all at the same place, visible for the families, the prospects. Everyone who comes in can feel the energy,” says Demelin.
“Office spaces are at the entrance — you always see someone talking with the general manager. It’s like a nest. There are a lot of people. It’s really designed to maximize the space that was available for us,” adds Demelin.
The large size obviously comes with its own set of challenges, though. Demelin describes renting units as “the core game” of Cogir’s Quebec communities. And the efforts have paid off, as the company boasts a 97.4 percent occupancy rate in Quebec, according to Demelin.
“It’s everything. If you ask anyone that works with us, ‘What is the most important stuff that you do every day?’ they will all say occupancy, occupancy, occupancy. When you build a football team, you need your quarterback. For us, the key players are the sales agents.”
For developers willing to accept that challenge, though, Duguay and Demelin believe there are opportunities for this type of community in the United States.
“The first time I built a residence in Ontario, we were afraid to build 200 apartments,” says Duguay. “Now it’s 250. The next step is 300 or 350. We know the way to do this. We’re having big success.”
“If you look at the cost difference between building 200 and 250 units, it’s the same,” adds Demelin. “It’s not 25 percent more plus labor, it’s almost the same. So, what would be the point not to have 50 more rents a month for pretty much the same labor a month? If they use the space the way it should be used, you can scale the labor, you can build bigger. If you build bigger you can get a more attractive product. It seems easy, but it comes with a change of culture.”
Europe embraces cohousing
Although seniors housing in Europe is a less mature product than in the United States, industry players across the continent are also incorporating a variety of alternative living types. That’s according to Steven Zijl, founder and CEO of Eurostate Real Estate Partners, a Barcelona-based private equity manager that invests in seniors housing, student housing and urban living.
One of these alternatives is cohousing, also known as collective housing, where the residents mutually own the property and contract with third-party providers for services.
“The typical model usually consists of community apartments equipped with a bathroom, kitchen, a couple of rooms and common services such as cleaning, kitchen, leisure areas, doorman and 24-hour nursing service,” according to Zijl.
“Cohousing is a way to resolve the isolation that many people experience, and to regain the lost neighborhood support. The people interested in these projects are very different as individuals, but united in the desire to avoid loneliness and to be responsible for their own lives. They value living in an active community where they know and can trust their neighbors. They make decisions together and are self-managed.”
Although this model exists in the United States, it’s relatively obscure.
Assisted living does exist in Europe, but is “not yet a common asset class,” according to Zijl. “This type of housing still finds its way in into The Netherlands and also some other European countries in different formats. The scale per project is much smaller than what is commonly developed in the United States.”
Intergenerational projects also operate differently in Europe than in the United States. In Europe, a student lives with an older person for an academic year “in exchange for a few hours of company and small services.”
Zijl highlighted a “mixed housing” project called De Buurt in Utrecht, Netherlands. The 343-unit community features subsidized rents up to $1,000 per month.
“The homes are for starters and for elderly people with and without a care need. De Buurt is a place where people can live, work, meet and relax. In the building there are homes for different people — for example, parents with children with autism, but also homes for elderly people with dementia.”
In another example of mixing seniors in with others, Zijl cites a “community housing” development in Barcelona named La Torre Julia. The property combines a nursing home, a seniors housing community and a sports center in the 17-floor, 77-unit building.
“Wide hallways with views over the city, stairs running around the exterior and a sunny roof make up a building designed so that older people have the possibility of socializing and enjoying community activities.”
Zijl also highlights a “courtyard living” concept popular in The Netherlands, where seniors live independently around a shared courtyard. The country is experiencing a “locked housing market” where sales are extremely rare, making it difficult for seniors to downsize as they age. The courtyard style of housing, known as Knarrenhof, is quickly spreading, according to Zijl.
“Each Knarrenhof also has a communal area and garden. People are more attracted to learn from other one’s knowledge and experience things together, where everyone is always free to participate. A Knarrenhof is about sustainability, affordability and communal living, encouraging residents to help one another.”
Ultra-luxury in Asia
Priya Living, a San Francisco-based seniors housing developer focused on serving the Indian immigrant population, made news last year by opening its first community in India.
The community is located in Flower Valley, an upscale township just south of Gurgaon, in the Delhi metro area. Designed for aging Indian immigrants to the United States who want to spend at least part of the year in India, the community is also expected to appeal to older adults in India who want an alternative style of seniors housing.
“We know that the diaspora wants to spend time in India as they age and come for extended stays every year,” says Arun Paul, founder and president of Priya Living. “We also know that older adults living in India today, those who never left the country, are seeking new lifestyle options, and have much higher expectations than a generation ago.”
Priya Living Flower Valley is the first of what will be many communities of its kind, located in major metro areas throughout India. Paul says the concept will be in five Indian markets by the end of this year.
“This is a product that works very well in the domestic market. In the Indian context, it’s a high-end product. But there’s a huge market for that in India.
“The main difference is the service levels are much, much higher than in the United States,” continues Paul. “Housekeeping is daily not weekly. Private drivers are available. Foodservice is 24/7. Programs are much more intensive.”
Perkins of Perkins Eastman also has incorporated the hospitality component into the projects the firm has designed in India, Japan, Thailand and other Asian countries.
By and large, the communities are ultra-luxury products for areas with a strong history of high-end hospitality.
“There is a strata that have high expectations about their quality of life in retirement,” says Perkins. “It’s done to a standard that’s more like a luxury hotel. Indoor pools, spa elements, the fitness facilities, the dining — generally speaking, they’re held to a much higher standard than even in the good CCRCs (continuing care retirement communities) in the higher-rent projects around the U.S.”
Perkins notes that entry fees for the properties his firm designed in India and Japan generally are $1 million or more.
Unfortunately, the reason these high-end concepts might not translate well to the U.S. is the cost and availability of labor.
“The limitation in the U.S. is labor,” says Paul. “Our product is, from that standpoint, much better in India. The question is how do you translate that back? You can’t solve the labor issue overnight.”
One way Priya attempts to tackle this issue in the United States is by having “universal workers” that handle a variety of tasks, rather than having every position be specialized.
“Roles are not silos. They’re multifunctional,” says Paul. “With universal workers, you get better coverage, better labor efficiencies, people like their jobs more, you get better retention. A housekeeper is not just a housekeeper. He or she can run programs or help on food and beverage service. We have to become much more creative with how we structure operations here in the U.S.”