Do’s and Dont’s for Active Adult: Playbook for Emerging  Property Type

Thinking of investing in, developing, or operating an active adult project? Here are some do’s and don’ts from experienced experts.

August 31, 2022

Active Adult • Industry Leaders and Experts • NIC Fall Conference • Blog

Thinking of investing in, developing, or operating an active adult project? Here are some do’s and don’ts from experienced experts.

  • Do pick a location near restaurants and shopping.
  • Don’t talk about seniors.
  • Do welcome pets.
  • Don’t provide transportation.
  • Do create an edgy design.
  • Don’t offer meals but do include a relaxing bar where residents can meet.

That’s just a sample of active adult do’s and don’ts highlighted at the 2022 NIC Spring Conference. In a fast-moving brainstorming session, participants divided into small groups to help define a playbook for the emerging active adult segment, a quickly growing property type targeting baby boomers.

The lively, well-attended session was moderated by Maria Nadelstumph of Brandywine Living, and Ben Burke of Headwaters Group. The breakout groups tackled three dimensions: people, programming, and product.

The session was so well-received that a special discussion on the active adult market is planned for the 2022 NIC Fall Conference on September 14 at the Marriott Marquis in Washington, D.C.

At the NIC Spring Conference, introductory video comments by current residents in active adult communities provided helpful context. The residents said they chose an active adult property because they wanted a sense of community. They were ready to ditch the house, but they weren’t ready for senior living with services. They were more interested in the lifestyle. After moving into an active adult community, one resident said: “I felt like I was on vacation.”

Investor interest in the segment is being driven by several factors, according to co-moderator Burke. The average age of residents is 72-74, younger than those in independent living. Active adult projects have higher rents than multifamily projects and lower expenses than independent living and longer lengths of stay. Fewer employees are required to run active adult projects, increasing the appeal in a tough staffing climate.

Facilitated by industry experts, the breakout groups discussed the three dimensions of the active adult market in 10-minute segments prompted by key questions. Observations were then shared with the entire audience. Here’s a quick recap of their do’s and don’ts.

2022 NIC Notes Blog Active Adult Session Summary Image

People: What’s the best way to attract residents of the right age?

Do think like a consumer. Active adult customers want to maintain their sense of autonomy. They aren’t looking for an institutionalized setting. Senior living is more needs driven than the active adult segment which is more of a lifestyle choice.

The consumer isn’t looking for care but wants to belong to a community. Residents want to engage but seek a carefree lifestyle. They want to be free of the responsibilities of homeownership. And they don’t consider themselves old—don’t use the word “senior.”

The active adult sales cycle is longer than that of traditional senior living. Adult children are typically not involved in the decision. Location matters. Consumers want a place that is near destinations outside the building, such as restaurants and shops.

Product: What design elements are necessary? Which aren’t?

Do include parking and storage space. These customers have cars and a lot of stuff.

Don’t remind people they’re getting older with subtle cues like grab bars and prominent elevator banks.

Forget on-site salons and therapy space. In-house services will encourage much older people to stay put and not move to a more appropriate setting.

Baby boomers prefer modern designs with an edgy feel, nothing like an old folk’s home. Open concept designs are popular. Common areas need to be flexible. Do include gathering areas and bars.

Welcome pets. Dog parks and exercise areas are popular with baby boomers who have pets. “People love their dogs,” said one participant.

Program: What program elements are necessary? Which aren’t?

Do offer resident-driven programming based on their interests. Wellness programs and informal gatherings, such as happy hours, help build a sense of community.

A big part of the discussion centered on how to maintain a younger resident profile. New residents may be hard to attract if existing residents are aging in place and need a lot of assistance. Best advice: Don’t offer transportation. Don’t offer care. Don’t offer meals. “How to handle the back door is a hot topic,” said Burke. One group thought residents would naturally decide to move out because they wouldn’t feel like they fit in anymore since the programming and activities were geared for younger people.

Mark your calendar for the 2022 NIC Fall Conference session, “Rational Exuberance: Investing in the Rapidly Growing Active Adult Segment” being held September 14 at 4:15pm. Learn from current investors in Active Adult who will share candid thoughts from their experience about operations, debt flow, and investors.

To view the full Spring Conference discussion, a recording of the active adult session is available on NIC’s YouTube channel.