The $12.5 million Collingwood Green development on Division Street will create a 68,000-square-foot senior living complex. The Crane's Landing and Collingwood Green projects are benefiting from federal tax credits for low-income housing.
In the last month, there have been three Toledo-area ground breaking ceremonies for senior housing centers or complexes.
And in the near future, experts say, expect more such projects to be built as demand for senior housing -- everything from independent living units to skilled nursing-care centers -- continues to grow.
While the recession became a wet blanket that smothered much of the nation's construction industry the last four years, one niche that continued to maintain a steady pace and now has begun to grow slightly is housing for seniors.
"I don't know if there's really a trend there yet, but it's a niche that's been fairly consistent," said Gary Haas, vice president of contracts and administration for Rudolph/Libbe Inc. "We see it with the baby boomers aging and retiring and people living longer that the demand is there and the money is loosening up," he said. "There are more of these projects going on compared to the overall commercial market."
According to an April report by F.W. Dodge Co., a subsidiary of McGraw-Hill Construction, overall construction starts in the first quarter of 2012 were down 3 percent from the same period a year ago. And for the 12-month period ending in March, construction starts were flat.
"On balance, the construction industry can still be viewed as struggling to see renewed expansion take hold in a sustained and broad-based manner," Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction, said in the report.
By contrast, data from the National Investment Center for the Seniors Housing and Care Industry shows that nationally the senior housing inventory grew by 1.1 percent in the second quarter of 2011, by 1 percent in the third quarter, 1.2 percent in the fourth quarter, and 1.2 percent in the first quarter of 2012.
The first phase of St. Clare Commons is under way in Perrysburg. The complex, owned by the Franciscan Living Communities, will have a 26-bed memory care center, a skilled nursing center, and 56 assisted living suites.
The center tracks nearly 13,000 investment-grade seniors housing and nursing care properties across the country that serve the 75-years-or-older population.
In Ohio, senior housing inventory grew by 1.1 percent in the second quarter of 2011, 0.6 percent in the third quarter, 0.6 percent in the fourth quarter, and 0.8 percent in the first quarter of 2012. In Ohio, the center tracks senior housing inventory in the state's seven largest metro markets.
Andy Schaub, president of Architects Plus Ltd., an architectural firm in Cincinnati that helped design St. Clare Commons, a $40 million senior housing project that broke ground in Perrysburg two weeks ago, said growth in the senior housing market would be even higher if not for the recession.
"The part of it that has suffered is that since people are having trouble selling their houses, they aren't as ready to move into these projects as quickly as they would like. So the people building these housing units are a little ahead of the game," he said.
"But the number of projects is much higher than regular commercial projects. We're seeing hardly any activity in corporate construction," Mr. Schaub said.
The Douglas Co., a Toledo-based general construction contractor, focuses the majority of its business efforts on senior-housing projects. As a result, it maintained a steady work flow during the recession and it is thriving in the post-recession.
In 2011, it handled 10 senior housing projects in various U.S. markets. Thus far in 2012 it has either completed or has under construction 17 projects nationwide. That includes one in Monclova Township, the $16 million Trilogy Health Service's Monclova Health Campus, an 82,000-square-foot campus featuring 120 beds for assisted living and a special facility to treat Alzheimer's or dementia patients.
"From 2003 to 2008 we grew from $20 million in revenues to $120 million primarily on the back of this market," said Pete Douglas, the company's president. "The development slowed in the recession, but it's back, and it's going to be incredible what happens in the next 10 years."
What will happen and what is happening now to fuel senior housing development is the graying of the Baby Boom generation. The number of Americans over age 65 will double to 71 million by 2030, and 7.7 million of them will suffer from Alzheimer's disease, according to the Alzheimer's Association.
Consequently, one of the bigger growth areas within senior housing is the construction of "memory" centers -- special facilities that concentrate on caring for and treating people with Alzheimer's or dementia.
Last month, Ohio Masonic Homes broke ground on the Pathways at Browning, a 24-unit apartment complex on its health campus in Waterville. The complex is a "memory-care center" specializing in the latest programming and technology to treat Alzheimer's.
St. Clare Commons, which will be owned by Franciscan Living Communities, will have a 36-bed memory-care center along with a skilled nursing center and 56 assisted-living suites.
"Memory care, that's probably where we're seeing the most demand," said Jay Morgan, senior vice president for finance at Toledo's Health Care REIT, a real estate investment trust that invests in senior housing and health-care real estate. "There's just a lot more research in how to care for folks with that affliction. It's creating a demand for that kind of care facility," Mr. Morgan said.
The senior-housing sector "has remained healthy because the demand is somewhat inelastic," Mr. Morgan said. "Even through the recession, people were still aging, people were still becoming frail, and they still needed the care."
In 2008, David Lynn and Tim Wang, two analysts for Clarion Partners Inc., predicted that there would be new opportunities for investors in the senior housing market, a niche they said would heat up and begin to take off, starting in 2010 and continuing through 2015.
One of the areas for growth: the Midwest.
They reasoned that there already was significantly more senior housing in the South and West, and that an increasing number of seniors were choosing to stay in their present states rather than relocate to the South and West.
"As far as seniors or the elderly choosing to age in place, that's probably true now," Mr. Morgan said. "But the other dynamic is seniors want to move near their adult children or their children want to move them near them. So if you have a growing [area] with professionals in their 30s or 40s and with parents in their 70s or 80s, they may want to move their parents near them." That is leading to growth in senior housing in several major Midwest metro areas, Mr. Morgan added.
Clearly a need
It is also leading more construction or architectural firms to find work in senior-housing projects.
Dan Tabor, a partner at The Collaborative Inc., a Toledo architecture and design firm, said his company hadn't designed a senior-housing project in more than a decade. "But we're doing three right now," Mr. Tabor said.
The company helped design Crane's Landing, a 40-unit senior housing project in north Toledo being developed on the site of the former Chase Elementary School by community development corporation United North Inc.
The Collaborative is also working with the Lucas Metropolitan Housing Authority on its $12.5 million Collingwood Green project on Division Street, which will create a 68,000-square-foot senior living complex. Rudolph/Libbe is the general contractor on Collingwood Green.
Recently, United North contracted The Collaborative to do a feasibility study to look at converting the former St. Hedwig School in north Toledo into additional senior housing.
Mr. Tabor said both Crane's Landing and the Collingwood Green project are benefiting from federal low income housing tax credits. "Whether those projects would have happened without that? Probably not," he said.
But all three projects are definitely being prompted by need for such housing, Mr. Tabor said.
"Clearly there is a market there to support these types of projects, and obviously there's ways to fund these other than the private funding. … The rest of the commercial markets and multi-housing in particular has been very slack for a while now by comparison," he said.
Architect George Berardi, of Berardi + Associates of Columbus, said there are in fact two population segments that are fueling the increasing demand for senior housing.
"One is the individuals that are living on fixed incomes and can no longer afford to live independently in large, inefficient homes. They have retirement plans but are looking at shrinking dollars," said Mr. Berardi, who also worked on the Crane's Landing project and on the Renaissance Senior Apartments in downtown Toledo.
"The other segment is people who just want to have a greater sense of independence, who want to be more mobile and more secure in leaving their large homes," he said.
Mr. Berardi believes the demand for senior housing has remained steady for years and never abated during the recession.
"There is more of a focus on responding to the demand, but the demand has always been there," he said.
Contact Jon Chavez at: firstname.lastname@example.org or 419-724-6128.
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