Posts Tagged ‘Housing Options’

Nightmare in Nanaimo?

Wednesday, December 7th, 2011

A recent article in the Nanaimo Daily News about seniors housing suggests that the average Nanaimo senior can afford 37.5 months of assisted living. And after that? The article leaves it to your imagination. Ice floes maybe?

But perhaps the situation is not as dire as the article suggests. For example, the average cost of assisted living per month is indicated to be $6,000. The average sale price of a condo in Nanaimo is indicated to be $225,000 resulting in the aforementioned 37.5 months.

Where exactly the reporter found that $6,000 unit is a good question. I have never heard of a $6,000 assisted living unit in Nanaimo. And most people who move to a retirement community don’t need assisted living anyway—they need housing that provides meals, housekeeping, laundry etc but they don’t need the level of care provided in assisted living.

According to CMHC, the average cost of an independent living unit in Nanaimo (one that provides meals, housekeeping, laundry etc) is $2,553—a long way from $6,000. And many people don’t move from a condo to seniors housing—they move from detached houses, the average value of which in Nanaimo is currently $356,000. And people use their income to finance their monthly housing costs, not just the proceeds of house sales. The article says the average after-tax income for 65+ people is $25,996. In fact, the average income of all 65+ households in Nanaimo is $46,471; of owners is $50,334 (80% of 65+ households in Nanaimo are homeowners).

All this is not to say that low income seniors, especially renters, don’t face serious housing challenges. They do. But to scare people by saying that the average senior in Nanaimo will only be able to afford to stay in a seniors’ community for 37.5 months is highly misleading. What is needed is a mix of options, ones that take into consideration peoples means before lumping them all together into one big pot of seniors.

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Transforming Institutional Long Term Care

Tuesday, November 8th, 2011

To most people in the field “institutional long term care” is a redundancy. If it’s long term care, it’s institutional.

But a movement in the US, called the Green House Project, is aiming to change all that. And it’s not green as in sustainability, it’s green as in grass, plants, gardens, the outdoors.

Here is a brief description from the web site:

‘The Green House residence is designed to be a home for six to ten elders. It blends architecturally with neighboring homes, includes vibrant outdoor space, and utilizes aesthetically appealing interior features. Each elder has a private room or unit with a private bathroom. Elders’ rooms receive high levels of sunlight and are situated around the hearth, an open kitchen and dining area. While adhering to all codes required by regulations, Green House homes look and feel like a home, and contain few medical signposts.’

To anyone familiar with modern care facilities in Canada and their associated regulatory frameworks, such a model seems impossible. But lots of research shows that not only is the Green House Project possible, it delivers better outcomes than traditional skilled nursing facilities and it doesn’t require any more staff resources. Many green home communities are now operating throughout the US although I have never heard of one in Canada, not surprisingly. It took us 10 years to catch up to the US in the assisted living sector.

We have lots of questions about this model as you probably do too. My first question is: how frail is too frail, physically and mentally, for a Green House client? We’ll find out and let you know in future posts.

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Lumina Group Newsletter Imminent!

Tuesday, October 25th, 2011

It’s been a long time coming (also one reason why there’s been a little bit of a drop off in my posting) but we will be in a position very shortly to launch our newsletter, called, perhaps a little unimaginatively, Industry Insights.

We have actually produced the first issue, focused on affordability in service-enriched housing environments. My colleague Carol Omstead and I have endless debates about this issue, focused on just how important affordability is in the grand scheme of things. That may sound ridiculous at first blush but remember that the private pay service-enriched sector appeals to a very small proportion of its target market—somewhere between 5% and 10% in most market areas. A very large proportion of the other 90% can afford what we are offering so to what extent will a more affordable product widen our target market? I think that is a very good question.

The first issue also lists 24 very exciting topics we will be addressing in future issues, ranging from operating expense ratios (how are YOU doing relative to industry norms?), to acquisition versus new construction analysis, to turnaround strategies for underperforming projects. And everything in between!

The details of how to get on the distribution list for the newsletter will be available within a week or two.

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The Largest Gated Retirement Community in the World

Tuesday, August 9th, 2011

I have been engaging in a bout of summer cleaning—trying to create breathing space in my usually very cluttered office. I can’t remember what clutter means from a personality perspective but I am feeling very smug about the order I have brought to a certain amount of chaos.

Part of the process involved going through piles of paper I always meant to get back to. One item in the pile was the Winter 2009 edition of Public Policy & Aging Report, which contains an article about The Villages in Florida, the largest gated retirement community in the world. It must also be the largest ungated retirement community in the world—it spans three counties, two zip codes and more than 20,000 acres. The dozens of villages are home to a total of more than 75,000 people (as of Winter 2009) with room for 35,000 more. Sun City Arizona in contrast is home to only 40,000 people.

To keep those 75,000 people amused, The Villages offers two downtowns, several shopping centres, dozens of pools and shopping centres, hundreds of hobby and affinity clubs, and 36 golf courses. How could they fit all that into 20,000 acres? 20,000 acres is just over 31 square miles so I guess it’s easy.

If all this sounds faintly horrifying to you, the same thought occurred to the author of the article (Andrew Blechman) so he set out to see for himself. What he found went beyond faint horror—his article makes The Villages sound like something right out of science fiction or George Orwell or both. He wrote a book about The Villages, called Leisureville: Adventures in America’s Retirement Utopias.

It all reminded me a bit of a local “utopia,” Arbutus Ridge on Vancouver Island. I recently tried to tour Arbutus Ridge when I was doing some work nearby. Not possible—you have to get written permission in advance from a higher authority than the security guard at the gate. The very first page of the Arbutus Ridge web site contains the following sentence, in bold.

A key attraction of our development is the security provided by a gated community design and our “24/7/365” security staff.

I am probably sounding a bit judgemental about all this. After all we are constantly saying in the industry that what we need is choice so that there is something for everyone. But withdrawal from civil society may go beyond the pale.

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Aging in Britain

Monday, June 6th, 2011

A recent article in the Economist (An age-old problem, May 28th, 2011) discusses the findings of a report from the Law Commission, an agency in Britain that helps Parliament “tidy up legislation”, in the inimitable words of the Economist. The report is focused on long term care and how to pay for it. At present, poor people have their care paid for by the state; wealthier people have to pay for it themselves, either by running down their savings or selling their home or both. This is a much different situation from Canada, where almost all long term care is paid for by the state. (Rich people pay a little more than poor people for subsidized care, but not much more. How long this can last is another question entirely.)

The Law Commission considered the fairness of the situation in Britain—should people who have worked hard all their lives, saved their money and bought property be faced with financial ruin if they require long term care? The Economist expects that further work by the Commission will recommend an insurance scheme of some sort, probably underwritten by the state, to help deal with these problems. Almost no one in Britain buys long term care insurance but as loyal readers of this blog will know, almost no one in any other country does either.

Another solution for aging Britons, suggested by the Joseph Rowntree Foundation, involves a home equity scheme. People would sell a stake in their houses, which would be reclaimed after death. The money so raised would be used to pay for home modifications designed to facilitate aging in place—showers instead of bathtubs and so on. A pilot project in North London has experienced only modest take-up so far but that is partly because a similar scheme in the 1980s did not work well and people remember.

Something is going to have to work, in Canada as well as in Britain. State-funded long term care is most definitely a time-limited solution to emerging needs.

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Baby Boomers (one more time)

Thursday, April 28th, 2011

Emmylou Harris has just released a new record which, by all accounts, is excellent. Reading the reviews I learned that Emmylou, who is 64, lives with her mother, who is 89, just outside Nashville. That got me thinking, yet again, about the future housing behaviour of the boomers. Coincidentally we have been cleaning out files and found a 2005 article from Australia written by Val O’Toole called Baby Boomers Housing Demands. The article references psychologist Erik Erikson, who theorized that when people are enmeshed in one stage of life it is very hard to foresee the next. That is certainly true of the boomers—it is probably true of everyone. When you are, say, 60 and fit, how can you possibly foresee what you might want when you are 85 and frail? People are always saying the boomers will be different when they are 85 but I am not so sure. It’s one reason I am looking forward to actually being 85—finding out how the story ends.

The Australian article speculates about all the possibilities and concludes that typical older boomers, like Emmylou Harris and her mum will choose to remain in the family home no matter how inappropriate it may be. That certainly mirrors the situation in North America as well.

But that is partly a matter of options, or lack of options. Today there isn’t much choice for mobile seniors beyond active adult type housing and service-enriched type housing. There are a few cohousing communities around, but very few other examples of more communal type living arrangements. That is one area I think is going to be a much more prominent part of the landscape in future years.

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Food and grab bars

Friday, April 8th, 2011

I realize that I have posted about these two issues on numerous occasions but they are both something of bêtes noires for me.

I have been travelling a lot and have eaten at several seniors’ projects. In one of them (which will remain nameless) the food was execrable. It isn’t often you get to use “execrable” in a sentence and I would have been glad of the opportunity if it weren’t for the fact that because I couldn’t eat the food I was extremely hungry.

I mentioned this to my good friend and colleague Rita Thibault at Westbridge Group Valuation Partner and she said: “Aren’t people trained to cook decent food for large numbers of people?” Good question. One of the residents at a sister project of the aforementioned community, where the food was much better but apparently still not up to snuff, commented that if the chef really were trained at some school the school ought to be shut down.

It consistently amazes and astonishes me that operators serve such lousy food. Even in projects that are fully funded and also full of people who can’t afford to move anywhere else, you would think simple human decency would lead these operators to serve decent food.

Then yesterday I ate a community that prides itself on its food and rightly so. My lunch was delicious. Food costs here are $7.50 per person per day, which is on the high side, but not only are the residents happy, the community generates a lot of revenue by catering outside events.

Enough said about food, at least for today, and on to grab bars. I have been in two seniors communities recently that have no grab bars in the bathroom because these communities are intended for “independent seniors”. That’s just dumb. Even hotels are better than that, or at least some hotels. I am currently staying in a brand new mid-range hotel and there is not a grab bar in site although the bathtub is very high. How many people do you think actually have baths in hotels? Very few I imagine. Why don’t they install showers instead? Even if there is some logic to the bathtubs, why no grab bars? Grab bars make tubs safer for everybody, to say nothing of the one in four British Columbians who are going to be over 65 in no time flat.

So there you have it – my rants for today.

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Are Publicly Funded Campuses of Care a Fraud in British Columbia?

Friday, March 25th, 2011

For quite a long time health authorities in BC have been extolling the virtues of the campuses of care they are creating where people can “age in place”. Most of the campuses are combined assisted living/residential care combinations—there are very few examples in BC of true campuses where housing for independent seniors (no services at all) is part of the campus. That model—the full spectrum—is common in the US, where it is known as Continuing Care Retirement Communities (CCRCs). The reason there are so few true campuses in Canada is because of our health care system. US seniors buy into CCRCs so they can be assured of access to the kind of care they need, no matter what it might be, as long as they live. Canadian seniors generally assume that the government will look after them when they get old and frail.

Most of the campuses in BC are subsidized by the government—“funded”, in the jargon. Access to funded spaces, residential care beds or assisted living units, is controlled through health authority case managers. Case managers are responsible for the needs of all the people in their areas, not just the people who may live on a campus. That means that there is absolutely no guarantee that if you live in an assisted living unit and you need a higher level of care that you will be able to move next door.

Health authorities are very sensitive to the needs of couples who may need to separate because of different health care situations and there is a lower incidence couple separation than there used to be. But aside from some couples, the promise of aging in place on publicly funded campuses is really a fraud, at least for most people.

Unless those people who need help have the ability to pay for everything themselves, in which case they can move to a few (but only a few) true campuses of care in BC or alternatively, bring all the services they need into their current homes, aging in place can be a very tough objective to achieve.

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An Asian Retirement Community

Thursday, March 17th, 2011

Readers of this blog are by now familiar with one of my many obsessions, that being the impact of multi-generational cultures on the demand for supportive seniors housing. The hypothesis is that in cultures where families look after their elders at home until they are so frail they need residential care, the intermediate step of supportive housing (IL, congregate care, service-enriched) is skipped. Here in very multi-cultural British Columbia, there is lots of evidence indicating that this hypothesis is a sound one. For example, in spite of a very large Chinese population (which typically cares for elders at home) there is only one small private pay supportive housing project targeted at the Chinese community.

But a recent issue of the Journal of Active Aging focuses on a retirement community targeted directly at the Asian community in Fremont, California that has been around for a decade. Fremont is a community of just over 200,000 people that is part of the much larger San Francisco Bay area (over 7 million people). The 64 unit project is owned and operated by Aegis Living and is called Aegis Gardens. The article is very positive, highlighting the linguistic skills of the staff (all, at a minimum, speak Cantonese or Mandarin or both), the design of the project (incorporating feng shui principles), and the activities (tai chi, mah-jong, origami). Food is not addressed in the article.

Outcomes have been extremely successful—80% of residents participate in physical activity programs, falls are a fraction of what they are at most communities, average age is older than at most other communities, staff turnover is extremely low.

The president of Aegis is quoted in the article as saying the company needed to negotiate a very steep learning curve on the way to success.

Part of that learning curve is described in an article in the San Jose Mercury News in 2004. That is a very long time ago but it is interesting to note that way back then, residents were upset. Here are some excerpts from the article:

But in the last few months, residents say, beloved Chinese staff members have resigned or been released, and replaced by employees who speak only English. The new staff members have implemented several culturally puzzling changes: buying wine for “happy hour,” moving a pingpong table into the tai chi space, and banning residents from cooking zong zi, a special rice dumpling prepared for the Chinese Dragon Boat Festival.

Residents have also complained that the center only spent $5.25 per resident a day on food. Though management has since raised the food budget to $5.75 a day, the food budget remains an issue. [note: $5.00 per day on food is quite common in 2011]

The Aegis Gardens situation is a “typical business problem” among companies trying to serve ethnic communities, said Felipe Korzenny, Florida State University professor of marketing communities and a local marketing consultant. The Aegis company has no Asian-American managers or corporate executives outside of its Chinese-oriented facility, Lucas said.

Note that was way back in 2004 and clearly, Aegis has addressed those issues. But the fact remains that in a metropolitan area of over 7 million people, where 20% are Asian, there is only one very small retirement community for those 1.5 million people.

Perhaps there are others and if any blog readers know of them please let me know.

Note: in US demographics “Asian-American” typically includes people of East, South East and South Asian descent.

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US AL occupancy slowly improving and other thoughts on assisted living

Tuesday, February 22nd, 2011

The most recent edition of Assisted Living Executive includes a chart illustrating AL occupancy levels over the period from the fourth quarter of 2005 to the third quarter of 2010. Occupancy levels fluctuated in a very narrow band between 90 and 91% from 2005 to 2007. Then the recession started to bite and occupancy levels fell to a low of 87.6% by the first quarter of 2010. They recovered somewhat to 88.7% in the third quarter of 2010.

Well you might say 88.7 to 91% is only 2.3 percentage points and that is true. But in view of the fact that there are more than 1,000,000 Americans living in assisted living units (estimate from ALFA) 2.3 percentage points means about 23,000 more vacant units in 2010 than there were in 2005.

While I was searching for that 1,000,000 number (it’s not actually units, it’s number of AL residents but I made the assumption that they are all living in individual units), I found another number on the ALFA website—86.2%. That’s the number of AL residents who pay privately for their accommodation and care. We always consider the US AL industry to be primarily private-pay so that was no surprise. But it got me thinking about AL in Canada. We have absolutely no idea how many assisted living units there are in Canada but there probably aren’t anywhere near 100,000 (using the old 10 to 1 ratio). In BC, the only province that regulates assisted living, the Office of the Assisted Living Registrar has registered over 6,700 units, 45% of them private pay. That does not mean that 6,700 people are actually receiving assisted living services because many operators register units in advance of providing services. Furthermore, no other province has provided subsidies for assisted living on the scale that BC has through the Independent Living BC program.

It seems fair to assume that BC probably has many more AL units per person over the age of 80 than any other province. If we remove the ILBC units and make an adjustment for registered units not actually providing AL services, perhaps there are 2,000 private pay AL units in BC, which has 14% of the 80+ population in Canada. Does this suggest a grand total of 14,000 AL units in Canada? When we might expect 100,000 based on US experience? Food for thought.

And for those wonderful blog readers who would like to listen to this as a pod cast please click the following link:

US AL occupancy slowly improving and other thoughts on assisted living

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