The Future of Senior Housing Development: Why Strategic Project Management Matters More Than Ever

The senior housing market is going through an unprecedented growth period. Demographic changes in the U.S., increased longevity and changing resident expectations are creating strong demand for new senior housing communities, assisted living housing, memory care centers and active adult developments. Meanwhile, developers, operators and nonprofit organizations are grappling with soaring build-out costs, labor shortages, regulatory complications and problems financing investment. 

The Demand for Senior Housing Continues to Rise

Success requires more than an impressive vision. It takes thoughtful planning, veteran project leadership, and disciplined execution from start to finish, from the idea to the occupancy site. And this is where owner representation and project management come into play. Older Baby Boomers are leading the senior housing demand drive. Occupancy levels will continue to grow, industry analysts say, as increasing numbers of Americans age beyond the point at which independent living, assisted living or memory care services are needed. Meanwhile, the amount of new construction activity is still at a historic low, contributing to increasing mismatch between the supply-demand trade-off. The oldest Baby Boomers are now getting into their 80s, a pivotal age for many members of the population when they start considering senior living. Even then, demand is growing faster than new inventory, providing openings for developers and operators that are prepared to invest in smart community-based development plans. Senior housing providers now don’t have the challenge of assessing whether there is demand. The challenge is delivering projects efficiently, on schedule and to an affordable standard that will satisfy the needs of current generations of people. 

Today’s Residents Expect More

Senior living communities have changed dramatically in the last decade. Today’s residents and their families are searching for something more than housing and care. They want vibrant communities for wellness, socialization, technology and hospitality-style amenities. Modern models of senior housing often include:

• Wellness and fitness centers
• Outdoor gathering spaces
• Flexible dining options
• Tech-facilitated healthcare
• Paths and green spaces you can walk
• Multipurpose community rooms
• Improved safety and security protocols

Projects grow more complex as expectations increase. Developers must weigh the experience for resident experience, operational efficiency, construction costs, long-term performance of facilities and operational efficiency versus the experience building costs. 

How an Owner’s Representative Adds Value

The development of many senior housing projects involve different stakeholders: operations, nonprofit boards, health care providers, investors, architects, engineers, contractors and local municipalities. Each group has specific priorities and goals. Without dedicated leadership, communication failures happen, important decisions can be delayed, and risks can mount. An experienced owner’s representative utilizes the client’s view and serves as their voice. They coordinate stakeholders, manage risk, budget, schedule and subcontractors to ensure project decisions are consistent with longer-term operational objectives. For senior living construction, owner’s representation delivers value through strategic planning. 

Good projects start long before the building begins. The feasibility study, evaluation of the site, budgeting, scheduling, and entitlement planning all impact the project success. In the early stages of project planning, an owner’s representative can identify risks before they become expensive problems. Here are some specific areas:

Budget management

Construction costs remain elevated across most markets. Active budget discipline keeps the project budget under control while upholding goals of the project. Ongoing cost and value engineering and procurement control can greatly minimize budget surprises.

Schedule Control

Financial, occupancy and operational planning can be affected by delays. The owner’s rep will liaise with the design team and contractors in managing schedule risks and to ensure projects don’t lose momentum.

Risk Mitigation

There are healthcare rules, access controls, life-safety systems, and intricate operations complexities which come into play in senior housing developments. Oversight on a project from an experienced team helps make sure that there is compliance, without costly reworks and change orders.

The Importance of Good (and Early) Communication

The disconnect between the design and construction can be one of the most problematic difficulties in construction of elderly housing. Communities might be great on paper with the perfect design but hard to manage. On the other hand, if cost-cutting measures are adopted they may have a negative impact on the resident experience and lead to the project becoming unmarketable in the long run. Involving operational stakeholders early in the planning process leads to better results. When project managers, operators, architects, and ownership teams can engage up front, they can make informed decisions in a balanced manner.

Renovation Projects Are Also On the Rise

Although new development gathers the most attention, many organizations are also committed to modernizing existing communities. A lot of senior housing holdings were built decades ago, and are in need of renovations.

Such projects may include:

• Memory care renovations 
• Resident room upgrades 
• Common area enhancements
• Dining renovations
• Building system replacements
• Wellness center additions

Community members often remain active during construction, so these projects need careful planning. An owner’s representatives can help coordinate phased construction plans that don’t come at the expense of a residents’ ability to stay safely and comfortably during the process.

Preparing Senior Housing Projects for Long Term Success

The senior housing sector offers great potential, but demands systematic execution. With increased need and more complex projects, those organizations need trusted advisors who can oversee development, construction, and capital projects through every stage of development. Successful communities aren’t about what you build. These are defined by how well those buildings serve residents, staff, operations and goals for the organization. 

At BC Group, we assist clients in dealing with that complexity by acting as a reliable advocate from the very beginning to end to turn our clients’ vision into high-impact, high-functioning environments that create successful, high-performing communities.