Retirement Communities Still Being Built
Just came across this article that talks about Scottsdale, AZ, but if you read through it, it can be applied to Arizona real estate in general. So what we have here is that the economy is moving slowly, but the retirees and seniors have money to buy homes in retirement communities that redefine them; they’re creating new properties right now that wouldn’t fly for the single family market. I’m real interested and curious to find if these retirement communities will fare as well as expected even in the recession.
Scottsdale’s real estate industry has slowed to a crawl but three developers are still pursuing a segment of buyers with money and at least a few more years to enjoy it.
Three luxury communities with a combined 850 units are under development in northern Scottsdale. Executives at all three say they are not worried about overbuilding these communities, which will primarily cater to seniors living independently.
“We are aware (of the competition) and believe there is enough room for all of us,” said Jason Craik, vice president of Avenir Retirement Communities, based in Vancouver, British Columbia.
Arizona is among seven states with the most robust construction activity for senior housing. That includes Washington, California, Colorado, Texas, Illinois and Ohio.
Each of the states has more than 2,000 units under construction, said a recent report from Marcus & Millichap Real Estate Investment Services.
Wealthy senior buyers in Scottsdale will have a choice of three new communities:
• Arté, 170 units on nearly 5 acres at 114th Street and Via Linda.
• Maravilla Scottsdale, 410 units on 25 acres northeast of Scottsdale Road and Frank Lloyd Wright Boulevard.
• Classic Residence at Silverstone, 270 units on 32 acres southeast of Scottsdale and Pinnacle Peak roads.
Communities evolve
All three feature contemporary interior designs that match Scottsdale’s upscale condominiums and dispel outdated perceptions of what retirement housing looks like.
“This business has evolved,” said Craik, whose company is building Arté. “These people are not just waiting to pass on.”
All three communities are going after so-called “go-go seniors,” who play golf, tennis, hike and exercise regularly. Each also has a limited number of accommodations for “slow-go seniors” in assisted-living units.
Maravilla and Silverstone will also offer care for residents with Alzheimer’s disease or dementia. Silverstone will have 24 beds in a nursing center.
Amenities will include swimming pools, fitness centers and multiple dining options. The two larger communities - Maravilla and Silverstone - will include pitch-and-putt golf courses.
Silverstone tab at $195 million
Among them, the three development groups will spend several hundred million dollars building the resortlike retirement communities.
Silverstone’s development partners, the Peoria-based Plaza Cos. and Chicago-based Classic Residence by Hyatt, are pouring more than $195 million into their project.
Silverstone is under construction on the site of the former Rawhide theme park.
Jackie Wolf, Classic Residence by Hyatt sales director, said the company’s success with its luxury retirement community at Grayhawk led to development of Silverstone.
Buyers have put down deposits on about 75 percent of the Silverstone units, she said, adding that the average age of buyers is 77.
“But as I tell our future residents, 80 is the new 60,” Wolf said.
Maravilla buyers plan ahead
Tim Cowen, Maravilla executive director, said a lot of buyers in their mid-60s are planning ahead, knowing that they can move from independent-living villas into assisted-living units if and when they need to.
“This is about making their own decisions,” he said.
Maravilla is being developed west of the Fairmont Scottsdale Resort by the San Diego-based Senior Resource Group. The 20-year-old company has 13 retirement communities, including four in Arizona in Phoenix, Tucson, Chandler and Green Valley.
The Avenir Group developing Arté has five retirement communities in British Columbia and is planning one more there, plus one each in Surprise and Chandler.
Mark Myers, a senior vice president for Marcus & Millichap, said Arizona is still a fairly strong market for retirement centers, but sales of luxury retirement units in Scottsdale will depend greatly on the recovery of the single-family housing market nationally, Myers said.
“Some of the go-go seniors are having trouble because they have trapped equity in their homes,” he said.
Nationally, occupancy in independent-living senior housing was 95 percent last year and the average rent was $2,390 per month, according to the Marcus & Millichap report.
Credit: AZStar.Net
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