U.S. News and World Report named Colorado the best state for aging in the U.S. One developer seeks to meet the skyrocketing demand for senior housing in the Centennial State.
Founded three years ago, Rocky Mountain Senior Housing now has a portfolio of seven communities across Colorado, with another three under development, Founder and Manager Terry Claassen told Senior Housing News.
Rocky Mountain, based in Glenwood Springs, has been able to achieve this rapid growth via an operating partnership with Lakewood, Colorado-based Wellage Senior Communities, which operates seven communities in Colorado, and consults with developers and operators across the country.
Claassen began exploring the senior living space in 2010. His development company owned a site in Glenwood Springs which was entitled for a high-end condominium project that became a casualty of the Great Recession, so he began looking at alternative development options.
“It was clear very early that the need for senior housing in Colorado’s smaller communities was dramatic,” he said.
Further research revealed the demand was greater than Claassen first realized. Colorado’s 65+ population increased nearly 29.5% from 2010 to 2015, and its over-85 population grew by 20.64% during the same period.
By contrast, the 65-and-older population nationwide saw an 18.6% growth from 2010 to 2015.
Adding to the attractiveness of building senior housing for Coloradans, a U.S. News & World Report study revealed that Colorado was the third-fastest aging state in the nation, the 65-and-older population is expected to reach 1.27 million by 2030 (a 77% increase from 2015), many older residents indicated they don’t want to leave the state as they age and 59% of the state’s population growth from 2010 through 2017 came through net migration.
From a real estate standpoint, Claassen loved the dynamics, but recognized he needed a solid operating partner if he wanted to enter the senior living space. After meetings with several operators, he met Wellage Senior Living President and CEO Jay Moskowitz and CFO John Brammeier and found the two companies’ missions were well-aligned.
“[Wellage] provides the seed capital on the real estate side, and we sign management agreements with them,” Claassen said.
Focus on smaller markets
The trend of Colorado seniors preferring to remain in the state as they age allows Rocky Mountain to build where the population is growing. The company’s target areas are suburban and exurban markets surrounding Denver, as well as rural markets across the state, Claassen told SHN.
Two communities in suburban Denver — The Lodge at Ken Caryl in Littleton and The Lodge at Greeley — are expected to open in Q4 2019 and Q2 2020, respectively.
Rocky Mountain opened an assisted living and memory care community in Grand Junction in the second quarter of 2019, and is doing entitlement on a second site in the western Colorado town that will be an affordable senior cooperative community.
Rocky Mountain wants to be agnostic with regard to price point and, as its portfolio grows, have a solid mix of market rate, middle-market and affordable price points.
“We’re pursuing opportunities across the spectrum,” Claassen said.
Development sizes will be market dependent as well. Rocky Mountain’s sweet spot is in the 60 to 140 unit range. One community, Montrose Lodge Senior Living in Montrose, is an 89-room CCRC which will include 20 free-standing independent living cabins and a central lodge.
With seniors demanding quality housing as they age, Claassen is confident that Rocky Mountain’s markets will provide everything future residents need, as well as provide feeder programs for recruiting and retaining strong workforces at its communities.
“Our mission is to provide quality living opportunities for these seniors so they don’t need to leave,” Claassen said.