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Baby boomers spark surge in demand for luxury eldercare
THE restaurant at Fountaingrove Lodge has a sweeping view of California's Sonoma County, a panorama one might expect at a five-star resort. The grounds include an impressive wine cellar, a spa, a bank, a fitness centre, a movie theatre and a large outdoor swimming pool.
But Fountaingrove Lodge is a not a resort - it is a retirement community, part of a new breed of luxury-supportive senior housing. These upscale communities offer a continuum of care from independent living to failing health, allowing people to age in one place for a relatively fixed price, but with amenities common in exclusive hotels and high-end cruise ships.
Now, as the baby boom generation is about to enter its most senior years, billions of dollars are being invested in a building surge for high-end housing.
The potential market is huge. By some industry estimates, 20 per cent of baby boomers, or about 15 million people, have saved enough to afford private continuing care, with many expected to demand a very high standard of living.
William Baird, 71, and John Kennedy moved to Sonoma in 2013 from San Francisco. Mr Baird was sceptical of retirement communities, but loved the design of the 1,800-square-foot apartment.
The community is part of a category of housing called a Continuing Care Retirement Community (CCRC). Industry experts said there were nearly 2,000 CCRCs nationwide with about 700,000 residents. Many require entrance fees and monthly charges that cover services, care and food.
"You're basically investing in your future health care and future needs," said Stephen Maag, director of residential communities for LeadingAge, an association that represents organisations and businesses in the ageing industry.
He said the average age nationwide of people entering the communities is the low 80s. Residents tend to stay seven to 10 years.
Entrance fees average about US$300,000, but in the luxury category that can be substantially higher. Entrance fees for the largest units at Fountaingrove Lodge - two-bedroom bungalows - are about US$1 million, with monthly charges of more than US$6,000.
"Our occupancy rate is 100 per cent," said Robert May, executive director, in October. Mr May said there were 100 residents and a waiting list of nearly 70.
Demand is also high in North Dallas, where construction of the US$140 million Ventana by Buckner luxury complex is due to be completed next year. The 186 apartments, ranging from 950 to 2,000 square feet, with concierge-level services and fine dining, have entrance fees from US$400,000 to US$1.8 million and monthly charges as high as nearly US$11,000.
Similar luxury communities have opened or are in development in Southern California and Arizona.
Recently, Related Cos of New York reported a partnership with Atria Senior Living, a housing management company, to develop, own and operate US$3 billion of upscale supportive housing for older people in the nation's top urban centre, including New York City, San Francisco, Boston, Los Angeles, Miami and Washington.
"For our whole careers, we've been in the luxury housing business," said Bryan Cho, executive vice-president of Related Cos. "So we're very excited about channelling all that talent into providing the best-in-class environment for seniors."
Although early in the process, the Related-Atria plan is to offer rentals and not charge entrance fees.
Those fees can be confusing and daunting, often representing a large portion of someone's savings or the proceeds from the sale of a home. The industry is not federally regulated, and contracts can be complex.
With people seeking assistance, Brad Breeding has gained a following with MyLifeSite.net, a blog that reports on the industry and dispenses advice.
Mr Breeding said it was rare for a community to go out of business, making the risks relatively low. Still, he recommended hiring an eldercare lawyer to review a contract.
"You're not selling a mattress here," he said. "You're selling somebody's complete lifestyle in a retirement housing plan, and they're putting a lot of money into this." NYTIMES