A prominent name in real estate development is creating its first senior living projects, partnering with Solera Senior Living on a pipeline in the mid-Atlantic region of the U.S.
The Denver-based senior living operator is partnering with Chicago-based McCaffery Interests on Modena Reserve at Kensington, a 135-unit community with independent living, assisted living and memory care in Kensington, Maryland. The $75 million, 167,000-square-foot development is the largest project in Kensington in 40 years and marks McCaffery’s entry into the senior living space.
Modena Reserve at Kensington also marks the beginning of an ongoing relationship between Solera and McCaffery. The joint venture is bidding on a second site in northern Virginia, and is looking at other opportunities in markets where McCaffery has a presence, Solera founder and CEO Adam Kaplan told Senior Housing News.
Headquartered in Chicago, McCaffery Interests has offices in Washington, D.C., Pittsburgh and Denver. In addition to development, the firm offers leasing and property management services, marketing and investment advisory services across multifamily, office and retail real estate. McCaffery founder and CEO Dan McCaffery has spearheaded the development of over $3 billion in completed developments, and is a mixed-use specialist.
A budding relationship
The Solera-McCaffery relationship dates back to May 2016, a month after Kaplan founded Solera.
“McCaffery is one of those firms I put on a pedestal. They were one of the top five in Chicago I could align with,” Kaplan said.
McCaffery Interests, meanwhile, was impressed by Kaplan and Solera, McCaffery Executive Director Juan Cameron told SHN. The relationship was solidified when Kaplan invited McCaffery COO John Ziegenhein to a National Investment Center for Senior Housing & Care (NIC) conference in San Francisco. There, Ziegenhein had a chance to see Kaplan in action, as well as gauge his industry knowledge and interactions with other senior housing professionals.
“The evidence of how people approached Adam, discussed his background and previous professional experience was pretty eye opening to us,” Cameron said.
Prior to founding Solera, Kaplan was senior vice president of business and organizational development at Chicago-based Senior Lifestyle Corp. The company is one of the largest senior housing providers in the United States, and was co-founded by Adam Kaplan’s father, Bill Kaplan.
Finding the right site
McCaffery controlled an office property in Virginia it wanted to reposition and believed senior housing would be a viable option. That site fell through, but Solera did market research and found the northern Virginia market had strong demographic and economic trends to support senior housing development. McCaffery had other sites in the area, including the Kensington property, Executive Director Juan Cameron told SHN.
Local officials did not want to see for-rent or for-sale multifamily housing on the site, as it would put added burden on the school system.
“Senior housing alleviated that,” Cameron said.
The community will include multiple dining venues, a penthouse lounge, a 10,000-square-foot courtyard, a wellness center with a fitness studio and therapy gym, and a full-service wine bar. Living units will feature hospitality-inspired designs, while the common areas will include open floor plans and a full slate of innovative technologies geared toward maximizing the resident experience.
The project is also incorporating two smaller historic buildings into the design, which will feature a coffeehouse that will be open to the public. The two-acre site is located near public transit, reducing the need for parking.
The Solera-McCaffery venture secured construction financing from M&T Bank to begin developing the site, and construction is expected to begin in the coming weeks. AEW Capital Management is another partner in the venture.
Construction is expected to be completed in early 2021, and Solera will operate the community under its Solera Reserve brand.
In addition to the second Virginia site, Solera and McCaffery are looking for opportunities to develop more senior housing in Pittsburgh, Boston and Richmond, Virginia, Cameron told SHN. The venture is a marriage each partner’s individual strengths. McCaffery’s extensive development and construction management experience allows it to quickly vet sites and move them through the entitlement process. Once a development is completed, McCaffery transfers the operations to Solera.
“They trust my expertise and I trust theirs,” Kaplan said.