Walk into Santa Marta in Olathe and you’ll find the amenities expected at any luxury hotel: a large salt-water indoor pool, grand dining room, sprawling outdoor patio, wood-paneled pub and exercise center.
Only Santa Marta isn’t a hotel. It’s a continuing care retirement community aimed at residents age 62 or older who want all the amenities associated with luxury living along with the peace of mind that comes from knowing their long-term needs will be met.
“It was my initiative to really have the ambiance, the environment, the service to resemble more of a resort atmosphere,” says Chet Surmaczewicz, executive director with Santa Marta.
To accomplish this, Surmaczewicz turned to his own background in hotels and resorts to create an environment he describes as residential and elegant, without being stuffy.
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The facility is known as a continuing care retirement community because it offers four full levels of care: independent living, assisted living, memory support and skilled nursing. Residents are able to move through the levels of care based on their individual need.
Santa Marta is far from the only option for residents across the metro area. Whether it’s in Overland Park, Liberty, Prairie Village or Kansas City’s Northland, the senior housing market is booming, and older adults have more choices than ever before when it comes to housing.
The market is seeing a rise in high-end apartments aimed at people age 55 or older who want to relinquish some of the responsibilities of home ownership but don’t need any additional healthcare services.
A new senior housing cooperative opened this month in Shawnee, with additional sites planned for Lee’s Summit, Lenexa, Lawrence, Overland Park, Kansas City and Northland communities. Facilities or small group homes specializing in dementia-related care are also growing in numbers, along with continued development of assisted living and independent living facilities.
The nursing facilities of 20 years ago are being replaced and updated to meet the needs of a new generation of seniors who demand a higher level of services and products.
The development is being driven, in part, by the aging baby boomers, who begin turning 70 this year.
It’s estimated by the Pew Research Center that approximately 10,000 people turn 65 in the United States each day and that will continue until 2030.
“That is truly a tsunami as the boomers move through, and they want choice and opportunity and they are going to be very demanding,” said Jim Glynn, a principal at GlynnDevins, a senior living marketing firm based in Overland Park. “Savvy marketers are going to provide us with what we want. They are not going to tell us what we get.”
With the first group of baby boomers turning 70 this year, Jordan Rappaport, a senior economist at the Federal Reserve Bank of Kansas City, says the senior housing industry has yet to see the surge of baby boomers leaving their homes that is expected in the years ahead.
“What we see, is that on average, starting about in their late 70s, a higher and higher share of people start living in apartments rather than single-family houses,” he said. “We expect that to happen starting in about five years.”
Rappaport says overall people are leaving their homes later than previous generations.
“When that happens has changed a lot over time; that used to happen in the late 50s back in 1980, so it has shifted to later and it’s possible it will shift even later going forward,” he said.
However, Rappaport says even if homeowners are staying longer in their homes, a spike in older adults looking for new housing options is still on the horizon. A new study from Merrill Lynch completed in 2014 found that 64 percent of retirees say they are likely to move at least once during their retirement.
“If there are a lot of options popping up, that’s a good thing because demand is likely to grow quite strongly,” Rappaport said.
A rebounding economy has also helped drive overall development across the metro.
“We are doing really well right now — permits are up and I think the market has confidence overall to invest in the area,” said John DeBauche, lead planner for the Long Range Planning and Preservation Division for the city of Kansas City. “It’ s a good place to develop and I think the market is reacting to that.”
DeBauche says the city has seen a growing number of senior housing options in the Northland. Since 2003, about 12 senior housing projects have either been built or are planned in the Kansas City portion of the Northland.
City staff are seeing similar trends on the Kansas side.
Leslie Karr, manager of current planning for the planning and development services department for the city of Overland Park, said the city has seen more inquiries about building senior housing options in the city. The city has also seen more variety in the types of housing.
“It’s kind of a whole array of options,” Karr said. “Where it used to maybe just be exclusively assisted living or nursing homes, we’re getting more active senior type living options and more short-term living options for someone who maybe is in need of some rehab assistance but ultimately is going to go back and live on their own,” she said.
While the overall numbers of seniors have helped to drive senior housing development and expansions, Joe Tutera, chief executive officer of Tutera Group, said the demands of the consumer and new healthcare reimbursement models are driving what those facilities look like.
Tutera Senior Living owns and operates eight senior living facilities in Kansas and six in Missouri.
Tutera, who has been in the senior housing business for 30 years, says in the last 10 to 15 years there has actually been a steady decline in the number of seniors needing longterm care due to a lower birth rate from the Depression through World War II.
The number of nursing facilities has declined from a high of about 18,500 to a low of around 14,000 over the last 10 to 15 years, Tutera said. The slow economy in addition to a smaller population of people needing services led to fewer new developments being built, and those that were in existence were modeled after older healthcare reimbursement and care models.
“Now we are starting to need more of those skilled nursing type services, and the product that is out there is very old and it was build for a completely different generation, different social model, different financial model,” he said.
Many of the older facilities had semi-private occupancies and were geared toward more long-term convalescence care, he said.
“The need for those seniors today is much more toward wellness, hospitality, short-term rehabilitation, integrating with the other products and services that are there like the assisted living, the memory care,” Tutera said. “You know — post acute type facilities providing rehab type services,” he said.
Tutera says the Affordable Care Act has also prompted a shift in healthcare from a fee-for-service payment structure to value-based care, where providers are paid for the value of care they provide rather than the volume. This shift, he said, has also prompted the creation of more continuum-of-care communities, where providers can work together to provide healthcare services for a population.
Tutera Senior Living & Healthcare plans to bring several new continuum-of-care communities to the Kansas City area either through the expansion and upgrade of existing facilities or construction of new facilities.
The advantage of these facilities, Tutera said, is that residents can move seamlessly from one system to another within the same property based on their need.
While most of these type of facilities require a buy-in or large upfront payment, Tutera’s model is based on a rental option and gives residents on both sides of the metro area one more choice as they consider retirement options.
Those in the industry agree that this new generation of seniors values choice and requires more than a one-size-fits-all model.
“We find that seniors are more savvy than their previous generations because they’ve helped their parents with these situations,” Glynn said.
One trend gaining momentum in the senior living space is the development of high-end luxury apartments geared toward people who are age 55 or older. These apartments don’t typically offer any healthcare services, but instead hope to attract active residents who are looking for a more care-free lifestyle.
Mike Rainen, president of Rainen Cos., is developing one of these properties in the Northland called Liberty at Shoal Creek.
The 185-unit property will include a variety of one- and two-bedroom options with monthly rents ranging from $1,100 to $2,000. Residents will have access to amenities like a simulated golf driving range, movie theater, yoga and Pilates studio and fitness center.
“We’re not necessarily looking for seniors; we are looking for mature people that want to free themselves of the responsibilities of home ownership and the time and the labor and the expense,” Rainen said. “And we want to allow them to be able to have fun.”
Cities are also seeing more development of multifamily housing units, as more people turn to rental options by choice rather than need, whether they are millennials or seniors.
Another new concept to the area is the senior living co-op. Earlier this month, the first residents moved into the first co-op opening in Shawnee, called the Village Cooperative.
Shane Wright, vice president of Real Estate Equities Development LLC, which developed Village Cooperative, said it’s a senior living concept that first began in the 1970s in Minnesota. Wright, who grew up in the Kansas City area, said his company felt after looking at the demographics of the area and home prices that it would be a great option to bring to the Kansas City area as well.
“When we first started looking at the demographics for the Kansas City metro, really it was kind of really shocking how far behind we felt Kansas City was in alternative options,” he said.
In addition to the newly opened Shawnee location, the company plans locations in Lee’s Summit, Lenexa, Lawrence, Overland Park and Kansas City.
Under the concept, the properties are ultimately completely owned by the residents themselves.
“Basically, we form a cooperative corporation in the state that it exists and we sell one share in the corporation for every home in the building,” Wright said. “So, if we are doing a 50-unit building as an owner you’ll be a one-fiftieth shareholder in the building, the common areas and the inside of the homes.”
Although the costs vary per project, Wright said typically the average cost to buy a share in the Kansas City area is in the low $100,000s. Residents then have monthly fees typically around $1,200 to $1,300 depending on the square footage.
Each year that they live in the property, however, they earn a 3 percent fixed interest rate on their share. That way residents have a predictable value for their share and the property is able to stay economical for the next buyer, Wright said.
“So for instance if you purchase a $100,000 share, 10 years down the road it’s worth $130,000. That’s what the next buyer pays,” he said.
New senior housing models aren’t the only growth in the industry: Assisted living and memory care facilities are also growing in numbers.
For instance, in 2010, Hunt Midwest partnered with Principal Senior Living Group to build an assisted living and memory care facility called the Benton House. The first property, Benton House of Shoal Creek, opened in 2012 followed shortly by properties in Lee’s Summit and Prairie Village.
“What we’ve seen in Kansas City is that there is definitely a hole in the market for that assisted living memory care product, but there was specifically a hole for the memory care,” said Brenner Holland, vice president and general manager residential development for Hunt Midwest.
Initially the company set out to open four Benton House communities, but the demand was so great it’s already opened six and has plans to open another three more by the end of 2017.
Benton House of Tiffany Springs opened a year ago and includes 45 assisted living units and 14 memory care units. It’s designed specifically to be a smaller facility to create a greater sense of community within the building.
“When you start needing more help, smaller feels more comfortable than big,” says Kyle Diekmann, the cofounder of Principal Senior Living Group, which operates the Benton House facilities.
Residents on the assisted living side of the property have their own apartment with a small kitchenette, a bathroom, living room and bedroom. They also share a small outdoor patio.
ShyAnne Forstner, regional director of community relations for Principal Senior Living Group, said every aspect of the apartment has been designed with safety in mind. For instance, residents are able to go out on their patio whenever they like, but a notification is also sent to staff members.
The facility is only one level so that all the apartments are on the ground level, and none are further than 75 steps away from a large common area where residents eat their meals and participate in social activities.
“We have someone seven days a week to do activities,” Forstner said.
Amos Williams, who has lived at the property for about a year, said one of the most popular events is the regular bingo games.
“We have a superb activity director,” he said.
The common area, which is flanked by glass windows looking out onto two courtyards, also includes a media room and full-size kitchen.
The idea throughout the facility is simplicity, however Forstner said the space also needed to be aesthetically pleasing and comfortable as well.
With more options in Johnson County and the Northland than ever, deciding which property to select isn’t an easy task.
Jo Ann Mulligan of Olathe moved with her husband into Santa Marta’s independent living eight years ago shortly after the facility opened.
As a former long-term care nurse, Mulligan said she’d seen firsthand what can happen as people age if they don’t get the support they need. During her time as a nurse, she worked with people who were no longer able to care for themselves but may not have realized that until an accident, like a forgotten lit stove, occurred.
“My philosophy is you should do it before you have to,” she said.
She and her husband were attracted to the idea of a continuing care community because it would allow her to have the peace of mind that all her needs would be met for the remainder of her life.
Now, that she’s settled into the facility, she said she’s happier than she was living in her own home and spends her days getting coffee, working out, playing bridge and being an active part of the residents council.
“I’ve never lived around such a fine group of people, really,” she said.
She said people who are thinking about moving into a retirement community should read the fine print of any contract they are signing to fully understand what they’ll receive for their money. She also recommends paying attention to the management and ownership of a facility to ensure that there will be stability after the move as well.
Many developers are looking to appeal to residents who want to stay in the Kansas City communities where they’ve spent their lives.
“A metro like Kansas City that has diverse options, it’s more likely that aging baby boomers will remain in it,” said the Federal Reserve’s Rappaport.
The breadth of senior housing options now in Kansas City communities on both sides of the state line doesn’t just benefit the older population of residents, it is also is a benefit to the area itself.
“I think that’s part of the fabric of the community to provide housing options for all of our citizens,” said DeBauche, the long-range planner for Kansas City. “We obviously are having an increase in people reaching retirement age and having these options open — people who want to downsize or have special needs — it’s just a reality.
“And I think the private sector is reacting toward it, and I think we will see more of it as we move forward.”