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Poor economic conditions can create significant challenges for senior living providers. Due to decreased access to capital and a downturn in the housing market, there’s a “new normal” operating environment where seniors have lower net worth, less disposable income, and reduced tolerance for the housing market’s volatility. Attracting customers in this environment is difficult. But there are three areas continuing care retirement communities (CCRCs) can consider when addressing these concerns.
Overcoming occupancy shortages is a concern for providers, especially those operating in survival mode and competing for the dwindling pool of age and income qualified residents. Some are adapting their missions and visions to meet the needs of older adults who are choosing to retire at home or rely on family caregivers to save money. Providers must find a balance between the continuum of care setting and the emerging home care based services.
Think about what will set your organization apart and how to market to your target audience. Creative techniques could include removing a consumer’s perceived barriers, such as assisting with downsizing, moving efforts, and even providing temporary bridge financing. Some facilities offer getaway weekends—they match potential residents with current ones who have similar interests and backgrounds. This gives people a taste of the activities and services offered in the continuum of care setting.
Ironically at the same time occupancy is an issue, capital costs have increased and credit access has produced an uneasy financial atmosphere. CCRCs need to demonstrate both financial stability and long-term viability, while managing resources to obtain the most favorable capital terms. Consider using operational improvements, coupled with strategic capital planning techniques, to measure resource utilization, monitor quality outcomes, and create liquidity. Good stewardship of your organization’s resources will give the entity flexibility and access to capital at reasonable rates.
Your primary role continues to be providing quality care for residents while right-sizing operations and balancing resident expectations. With the aging of the Baby Boomer generation, providers are anticipating a tidal wave of residents who will be evaluating retirement options. Many CCRC leaders who have come to terms with the new normal environment (strained housing market and lower net wealth) have gone on the offensive, using strategies such as diversifying their services and program offerings.
Some of these methods involve the continuous monitoring of competitors’ activities and a perpetual evaluation of factors affecting the market (e.g., changes in reimbursement and the use of health care technology). Innovative providers are anticipating the interests of prospective residents, diversifying services offered, and developing unique programs. Some are affiliating with universities in order to facilitate new educational programs and activities.
Many retirement communities are beginning to follow these trends to increase the percentage of consumers, while others are rebuilding their whole structure and molding it into the most recent aging American demographic profile. It is good to be open to trying new things, regardless of what market you are in. Although you should do your homework before reinventing your community, remember that these difficult times bring about opportunity. By redirecting marketing strategies, you could give your aging-services organization an edge in the retirement community housing market.