The active adult segment, sometimes referred to as 55+ housing, has a bright future according to many of its developers. To stay ahead of the game, though, operators need to carefully consider both how they define their product and what they offer in order to capture a new resident who is looking for a certain type of lifestyle.
That’s according to panelists on a webinar titled “Active Adult — How to Define It and Where is the Industry’s Hottest Segment Trending?” Seniors Housing Business hosted the webinar, which ProMatura Group sponsored.
Panelists included Ryan Frederick of strategy and consulting firm SmartLiving 360 as moderator; Michael Uccellini of The United Group, which owns and operates 18 active adult communities; Margaret Wylde of research firm ProMatura Group; Mitch Brown of Greystar, which operates 40 active adult communities; and Robert May of Avenida Partners, which has developed seven active adult communities to date.
Frederick opened with a question to the panel: “Where is this field heading? I’m particularly interested in the consumer needs and how the product will change to serve a difference consumer.”
Wylde continued the discussion with some history and defining characteristics of the segment. She noted that while age-restricted, for-sale, single-family home developments appeared in the 1950s, it wasn’t until much more recently that demand appeared for rental product.
“They have a variety of amenities — some are highly amenitized, then others scale back and deal more with lifestyle.”
Brown notes that that diversity sometimes makes it difficult to market. Unlike a shopping center where the consumers understand what it is, many aren’t as familiar with the niche of active adult rental housing.
“We struggle with nomenclature,” he said. “What do we call ourselves? We’re highly diverse.”
May noted that the market is ripe, as well, as many healthy seniors are downsizing. But many move into standard multifamily housing because of that lack of knowledge of the lifestyle they might enjoy at an active adult community.
“It’s important to create a definition and we’re struggling with that,” he said. “The three questions we have to answer are: What is the senior going to want, what will they pay for it, and what will it cost to operate?”
Uccellini noted that because of the lifestyle elements — his properties include a 8,000-square-foot to 10,000-square-foot clubhouse — they charge 25 percent to 50 percent higher rent compared to Class A multifamily.
“It’s important to have amenity spaces and lifestyle spaces and create community. Active adult is very much an operating business,” said Uccellini. “Seventy-five percent of our residents are selling a home and come from within a five-mile ring, so it’s also important ot analyze the demographics very critically.”
To view the full webinar, click here.