Editor’s Take: Amazon, Realogy and the Uncertain Future of Senior Housing

Imagine it’s 2025, and you’re an 81-year-old who has had a rough year. Maybe you had a surgery, or your adult child moved across the country. Maybe you lost your spouse. You’re still healthy and active but it’s time, you realize, to consider moving into an independent living community.

So, you log onto Amazon.

Through the Amazon website, you’re connected with a local referral agent who is well-versed in senior living options. With the agent’s help, you find the perfect community and decide you’ll make the move. Once the lease is signed, you receive a package of Amazon products worth thousands of dollars, to turn your new IL apartment into a smart home. And, you get an Amazon service package, meaning someone shows up to help you downsize and physically make the move into senior living.

Advertisement

If that sounds far-fetched, consider the TurnKey initiative that Amazon launched in July with Realogy, the nation’s largest residential real estate broker. Realogy brands include Coldwell Banker, Century 21, Sotheby’s International Realty and Corcoran.

The TurnKey website is accessed via Amazon. Through TurnKey, users answer some questions about what they’re looking for and are connected with a Reology agent. If a sale is made via that agent, the homebuyer receives coupons for Amazon products and services, which together could be worth up to $5,000.

The partnership is meant to bolster lead generation for Realogy, which has taken hits from competitors like Zillow and Redfin. Amazon, meanwhile, hopes to benefit by creating new business for its Home Services division, which faces competition from outfits like TaskRabbit and Handy. Not to mention, it’s another potential way for Amazon — maker of the Echo — to get an edge on its rivals in the smart home tech sphere.

TurnKey has launched in just 15 markets so far, and it’s not a service specifically tailored to older adults — although, Realogy is aware of this consumer segment.

“While we created the TurnKey program for all consumers, we believe the added benefits of being matched with a hand-selected and highly vetted agent, along with the Amazon Move-In Benefits we currently offer, including complimentary Amazon Home Services and fully-installed smart home products, can be especially beneficial to older homebuyers,” Eric Chesin, Realogy senior vice president and head of strategy, told me in an email. “These benefits can appeal to buyers who may wish to live more independently in a connected home or who seek extra help with tasks like deep cleaning or a handyman to assemble furniture, hang pictures, install shelving or mount a TV on a wall, which are all part of the program.”

TurnKey today is focused on single-family home sales. Extending the platform to help people find senior housing rental options might seem out of scope, but anything is possible. Here’s what Chesin wrote when I asked about TurnKey venturing into these other areas:

“We plan to pay close attention and learn as much as we can in these [launch] markets to understand the needs of consumers across the country, so we can continually evolve and improve the program.”

I don’t know whether a TurnKey type of offering for senior housing would be a net positive or negative for the industry, but the venture at least suggests to me how Amazon might disrupt the current sales process — which clearly is far from perfect.

There are longstanding complaints about the expense and influence of existing online referral platforms. This marketing director recently “confessed” about a host of challenges in making memory care sales. Major owners and operators from Brookdale (NYSE: BKD) to Capital Senior Living (NYSE: CSU) to Life Care Services to Bridge have made sales process improvements a priority in the last year, with varying levels of success.

But TurnKey may have implications that extend far beyond sales. There has been ongoing speculation about the scope of Amazon’s ambitions in real estate. Some analysts view TurnKey as a possible first step toward Amazon acquiring Realogy outright and eventually becoming a one-stop shop where people can find, finance and buy a home.

Meanwhile, Amazon has also invested in PlantPrefab, an outfit that creates custom single-family and multi-family homes utilizing prefabrication — a growing trend in construction that has attracted senior housing interest.

Senior living stakeholders might be tempted to take a wait-and-see approach to determine if and how Amazon disrupts the real estate sector, given that the most immediate focus appears to be on single-family home sales and, perhaps, construction. But keep in mind that Amazon is actively gathering intelligence on the senior living industry, and many providers already have invited Alexa into their buildings.

It’s been a few months since TurnKey launched, and I’ve been kicking around the idea for this column ever since. I’m finally putting pen to paper — or, fingers to keyboard — following comments I heard at last week’s National Investment Center for Seniors Housing & Care (NIC) fall conference in Chicago.

At NIC, several industry veterans described to me how tremendously the event has grown over the years, and how this reflects the maturation of the senior housing sector. Some of these same people observed that the industry has grown but the product has not evolved from the early days — not enough, anyway — and now radical innovation is needed to serve the coming wave of baby boomers.

Often, that observation about the need for innovation comes with warning: Change could take the form of unwelcome disruption from the likes of Google, Apple —- or Amazon.

In other words, the senior living industry cannot afford a wait-and-see approach, or draw too much confidence from an anticipated demand surge as the boomers age. Because, surely, Amazon is not blind to the market opportunity represented by this demographic.

Will senior living providers find their communities do not fill up as planned, because massive numbers of older adults are turning to Amazon to solve their housing needs, and they end up in buildings constructed by PlantPrefab and outfitted with the latest smart tech to enable aging in place, with home maintenance provided by Amazon services?

That’s just one scenario that comes to mind, and I don’t pretend to know how realistic it is. But it’s becoming increasingly obvious that senior living owners and operators must entertain such possibilities and be willing to shake up the status quo now, or they will find themselves in a world of pain tomorrow.

Companies featured in this article:

, , , , , ,