LeadingAge Magazine · March-April 2020 • Volume 10 • Number 02

Design and the Middle Market

February 16, 2020 | by Gene Mitchell

Any sustainable middle market model will need to include—but probably can’t be limited to—new ways of thinking about design. We asked architects to give us their perspectives.

For providers interested in serving new middle market populations of older adults with new forms of housing and amenities melded with services, it’s natural to think about ways new properties might be designed and built to reduce costs.

While rethinking the physical design of retirement communities may not be enough, by itself, to solve the middle-market challenge, it should be a part of any emerging strategy.

LeadingAge talked with several architects, all with experience in senior living, to learn more about what they hear from their clients and about how design might contribute to new models.

What Clients are Saying

“The middle market seems to be getting a lot of attention in the last 2-5 years,” says Craig Kimmel, a partner at RLPS Architects in Lancaster, PA. “The challenge is that everyone defines the middle market differently, [and] putting metrics around it is hard.”

Kimmel says many clients are thinking about what they can do to expand and complement their existing campuses, with far fewer considering greenfield projects.

“That segment of the population […] is growing, and the demographics show the explosion will be on the mid-market side. There will still be people interested in life plan communities, but that demographic is not increasing as dramatically as the middle group that is currently significantly underserved.”

“We do client surveys,” says Martin Siefering, a principal at New York-based Perkins Eastman, and the idea of serving the middle market is increasingly important in the way [clients] express themselves. There are a number of ingredients that go into making their [typical] projects feasible that you can’t do for the middle market. But the demand is so extreme that there has to be a way to make this work.”

Melissa Pritchard, managing principal at SFCS Architects, based in Roanoke, VA, tells the story of the latest SFCS By Design Conference, an annual event the firm hosts in Roanoke.

“Last year, we took a vote from the [attendees] regarding the research topics most interesting to them,” Pritchard says. “Affordability was the number one answer. Everyone was talking about having a problem. No one was talking about ideas to solve it.”

SFCS has talked to a number of senior living providers and toured many communities to come up with what she calls a “middle market formula”—a usable checklist for providers to work with.

“We also noticed,” says Pritchard, “that a lot of the discussions we see […] are all bullet points and numbers, very dry and not about the people that need this, and what their circumstances are. We need to put a face to this.”

Design Can’t Do the Job Alone

All of the architects interviewed agreed that design changes alone could not make a project middle market-friendly.

“Design has a significant role to play, but of the 8 stages of a project, design and construction are only 2,” says Pritchard. “The business model, the target market, operational decisions—all of them carry more weight.”

Even so, there are a variety of design strategies that can cut costs.

Unit size and common area design: “You can try to get more units out of a piece of land,” says Siefering, “and help clients find land in more urban locations. One thing we’re looking at is where we can ‘borrow’ facilities from adjacent organizations, or where there’s an abundance of services in a short walk.”

Design of common areas can minimize single-use spaces and emphasize multi-use areas.

“Think about flexible spaces that can be used for card playing one minute, a movie another, and exercise another,” Siefering says. “Can we use volunteer labor to transition from one program to another? People don’t come for the community space, they come for the community.”

Pante’a Khoshnevis, an associate - senior project manager for the California-based DAHLIN Group Architecture Planning, notes that in some markets, the mixed-use concept can apply to buildings as well as spaces within them.

“We may have an opportunity to use a mixed-use building that can be shared with residents and the surrounding community,” Khoshnevis says, referring to urban structures that house, on the ground floor, day care or wellness centers, medical services, or bistros that are also open to the public.

She also notes the importance of high building efficiency (the ratio of rentable square feet to gross square feet): “Building layouts should be as efficient as possible, with ratios […] higher than 65% for independent living, and higher than 50% for assisted living or memory care.” In California, she says, typical unit sizes for middle market independent living are 600-800 square feet. “As soon as you go above 900, the building efficiency drops.”

Rethinking parking: “A lot of money goes toward storing vehicles,” says Kimmel. “We start by looking at things outside the dwelling, first being how do we handle the car.”

Khoshnevis has worked in West Coast cities that actively discourage driving; she cites a project in Seattle that has no requirement for parking, thus making more space available for amenities.

Height and structural materials: Kimmel says, “It’s pretty easy to do 3-4 stories with wood frame construction because it’s less expensive, and we’re doing a few projects in steel and concrete because they are 5 stories or more.”

He says he prefers 3 stories to 2 because, “If you want to be more compact and vertical, 2 stories are a killer because you’re buying the elevator and stairs but not taking much advantage of those fixed costs.”

Khoshnevis echoes that advice: “Urban development demands mid-rise non-combustible [i.e., not wood-frame] construction, whereas in a suburb, we have the land and can design larger footprints [for] low-rise buildings up to 4 stories with no underground parking.”

Tricks of the trade: Kimmel lists a number of design elements that can typically reduce costs:

  • Eliminate “plane changes” whenever possible. (Imagine a simple rectangular building with 4 flat sides rather than a rectangular building with indented sections that break up the exterior walls.) “As architects, we love plane changes because they create visual interest,” he says, but notes that they add construction cost.
  • Be creative with unit plans to decrease width and increase depth. “The offset with that is daylight. The narrower the face open to the sun, the less daylight, so we can increase window heights to compensate.”
  • Avoid balconies, and if they are used, make them small, with a sliding door and a railing. “The cost of balconies can’t be recouped in the first turnover of a unit. A few units could get a balcony if you can charge more for them.”
  • Use less masonry and more vinyl siding.
  • Use single-hung windows in which only the bottom sash opens.

Managing Costs

Siefering believes that economies of scale must be leveraged.

Deer Creek
Deer Creek Senior Apartments is a suburban middle market
development for older adults, near a community library,
community center, and a community college, which allows for
sharing of parking as well.

“One ingredient to watch is density or scale,” Siefering says. “It’s difficult to do a small project because it’s very [hard] to deliver services in a cost-effective manner. Maybe you can get the care increments down to 30 minutes instead of hours. And doing projects with 50 units is too small. This becomes more practical, perhaps, in the 125-175 unit range.”

“Another way to reduce costs, especially in California, is solar hot water systems and photovoltaic panels providing energy,” says Khoshnevis.

“If it’s a rental product,” says Kimmel, “[providers] have to put some significant equity into the deal, or get a partner. Without entry fees to recover some of the development costs, rental products can be a difficult shift for an established life plan community.”

Kimmel also speculates on ways to blend an entry fee model with a rental model in the same place. “You might have different people—with different meal plans because some are drawing down a declining balance while others are buying a la carte—but all of them are just swiping their smartcards, so with new technologies, some of the stigma between rental and entry fee residents goes away. Another idea is that a rental product typically [has] smaller unit sizes, and some life plan communities have a hard time selling smaller units. Communities may be able to create a rental product with the smaller inventory without actually building anything.”

Is Housing Plus Services the Model Most Likely to Succeed?

“If your approach is to take a life plan community [model] and strip it down, then you may get to a solution that serves the upper middle market, but not the whole range of the middle market,” says Pritchard. “We haven’t seen [a way] to strip out enough amenities to be able to get to a middle market product that serves the middle or the lower section of the middle market. But what if you start with an affordable development mindset, and the first job is affordable and accessible housing? You [then] build on top of that.”

Pritchard suggests that solutions to this problem lie in limiting amenities, providing resident service coordinators with strong social work backgrounds, and community nurses to help with transitions and resources.

A Design Competition for Barrier-Free Living

Providers of older adult housing might enjoy reviewing entries in the ZeroThreshold Design Competition, sponsored by North Coast Community Homes, a Cleveland, OH, based provider of housing for persons with developmental disabilities, severe mental illness, and other disabilities. The competition has received funding support from the Cleveland Foundation.

DAHLIN is one of many firms that entered the competition, which aims to create accessible designs with a goal of making Cleveland “the world’s best barrier-free city.”

LeadingAge members may find the competition’s submissions interesting, perhaps inspiring new ways of thinking about design for aging. View the projects at the ZeroThreshold gallery page (be patient; this link takes a long time to load). DAHLIN's submission is titled “The Link.”

Gene Mitchell is editor of LeadingAge magazine.