Reasons for renovations in senior living can be brought up from many sources. Some of these sources may include normal wear, new or evolving security concerns, increased competition for residents, or even a budget surplus. While all of these may be motivating factors in the decision to move forward with a renovation project, there are several other reasons which may also contribute to a need for renovations.
Market Background & Trends
All market indicators are pointing to the single largest population shift in American history. After World War II, the increase in the population known as the Baby Boom has caused a number of changes to everything from shopping trends to economic policy. As the Boomers transition into retirement, senior communities are scrambling to prepare for the largest demand their market has ever experienced. This unprecedented shift is causing many existing facilities to rethink their business approach so that they can not only remain relevant but can also compete in this evolving landscape.
Faced with significant shifts in new construction, or an increasing trend of seniors opting for in-home care, and increased life expectancies, the facilities who are proactive are the ones most likely to rise to the top. To help those who may be on the fence about the need to renovate, I’ve put together this list of 5 reasons why renovation should either be in-progress now or on a schedule to be done.
1 – Baby Boomers are already in the market and planning their future
According to the U.S. Census Bureau in a March 2018 report on senior housing, the estimated population growth of seniors over the age of 75, during the years 2020 until 2030, is expected to grow at 36%. Additionally, by 2050 the 75+ population estimate is more than double that of 2020.
You may be thinking, “Anyone can do the math, but how do I know that they are planning for the rest of their retirement?” Try thinking of it like this. You need groceries. You may look at coupons, plan for upcoming meals, and rummage through the pantry before you make a grocery list. Now, I ask you, if you would take this much time to prepare for a trip to a grocery store, when would you start looking for a place to spend your retirement, and maybe the rest of your life?
2 – If you aren’t competing, you are already behind
The senior living construction boom started ramping up in 2014 and into 2015. During this period, the number of new senior living facilities under construction almost doubled over the same time just a few years earlier. These soaring numbers continued through 2016 and 2017, but these trends began to tail off in 2018 and into 2019. The number of new construction projects are still way above normal even though the largest surge of the construction boom has passed. This points to the fact that the market has already reacted to the projected growth and has a jump-start on attracting new customers in the market.
Many of these new modern facilities are colorful, open and bright, designed with the goal of attracting new residents. Often, activities focusing on fitness, health and wellbeing, and social interactions are used as additional lures to drive occupancy. In short, this is your competition. If you want to compete for this market and fill your beds, it is critical to compete on a similar level.
3 – The competition isn’t just other senior living facilities
Even with the flood of new, modern, active and beautiful options, more and more retirees are opting for in-home care. Among the reasons driving this trend are budget concerns, the pride of being self-sufficient, and the fact that many older facilities feel like hospitals and institutions.
It isn’t necessary for a senior living facility to feel like a hospital. The more a facility can be made to feel like home, the more appeal it will have for the portion of the market that may be choosing in-home care as an alternative to living in a senior community.
4 – Word-of-Mouth Can be Positive or Negative
As research deepens into the causes of dementia, depression, and feelings of isolation later in life, non-medicinal treatments are beginning to rise to the surface. Activity programs, or any opportunity that a facility can provide which encourages social interactions in seniors, can be used to help treat and sustain mental health.
Part of the treatment plan, prescribed by many doctors and healthcare providers, is to take part in socialization programs with other seniors. When they get together to discuss what is happening in their lives, what do you think they are talking about? And more importantly, what can you do to ensure that when options for living arise, a compelling case is made for your facility? You can drive the narrative through the experience provided in your community.
5 – It doesn’t have to cost a fortune
At the end of the day, the cost of operating a business will often determine what improvements can be made. Improvements can cost anywhere from a couple of dollars to thousands and hundreds of thousands of dollars.
I believe that two of the quickest and most cost-effective improvements that can be made consist of adding décor items and improving lighting. From there additional changes can be repainting a room or replacing furniture. Installing a patio or larger construction projects can then be spaced out and budgeted into a refresh cycle spanning several years.
Remain Competitive in the Market
If remaining competitive is the goal, simple upgrades can help you get there. Competition is an essential part of any business. But, in the senior living industry, the commodity being sold is the experience, not a facility. The ability to make that experience positive so that your business thrives may be the difference between struggling to fill beds and having a waiting list to join your community.