SHN Research: 88% of Senior Living Pros Say Active Adult Should Lead the Continuum

Technically speaking, independent living remains the consumer entry point into senior housing — the first step in the traditional care continuum.

But as senior living operators know too well, consumers at that entry point are older than in the past, with many now well past 75. That’s why so many senior housing operators are looking into adding active adult — and why, according to original data from Senior Housing News shared in a new SHN report, many believe the industry should codify it as an official piece of the care continuum.

In an SHN survey querying 120 senior housing professionals, conducted from Sep. 16 to Sep. 24 of this year, 88% of respondents stated that active adult should become the new first step in the senior housing continuum, preceding independent living. (Full results of the survey can be found in the new deep-dive report on the active adult opportunity, “The Changing Face of Active Adult Rental.”)  


After all, the typical IL resident today is in her mid-to-late 80s. As of 2017, life expectancy for an 85-year-old was 6.6 years.

That means senior housing potentially has less than a decade with any given resident. For an industry battling oversupply as well as the simultaneous surge in telehealth and home health care that combine to help seniors age in place in their own homes, a care continuum that ends just 10 years after it begins is bad math.

Though confusion and disagreement remain around the term “active adult” — NIC is actively seeking to nail down a definition — the product was defined in the SHN survey as age-restricted or age-targeted rental apartments with no care or personal service component, thus distinguishing it from IL.


From that starting point, it’s easy to understand the thinking on why senior housing operators are starting to enter the active adult space. The product addresses multiple problems facing the senior housing industry today.

First, with active adult’s move-in age in the low- to mid-70s, the product helps the industry re-capture a younger senior — a demographic that formerly was in IL.

Second, senior housing operators that develop and own active adult create a pipeline of residents into their IL — seniors who become a greater risk to eschew senior housing the longer they remain in their own homes.

“We’re not competing with multifamily, we’re not competing with independent living,” Zachary Crowe, principal at active adult leader and private equity firm The Carlyle Group, said in September at the National Investment Center for Seniors Housing and Care (NIC) conference. “What we’re competing against is our prospects staying at home, generally speaking.”

With its 15 stabilized active adult communities, The Carlyle Group is among the many traditional multifamily players making big active adult plays. Those moves, along with increased consumer demand and increased investor interest, is leading to more senior housing operators entering the fray — including a billion-dollar-bet from Atlanta-based Holbrook.

The demographic opportunity

The raw numbers showing the size of the baby boomer generation — including the oft-cited 10,000 boomers turning 65 each day — give only a vague sense of the active adult landscape facing senior housing operators, because those numbers reveal little about the consumer other than the market potential.

When operators and developers drill deeper into these figures, what they find is a vast consumer base, and a greater understanding of why senior housing operators are starting to view active adult as a possible stepping stone into IL.

These young boomers want an active lifestyle focused on wellness, fitness and socialization. They perhaps even want a glamorous lifestyle, at least compared to how they have lived for the bulk of their adult life.

“You’re not getting the ‘55+ person’ — you’re getting the 75+ person who may be retired, but perhaps doesn’t want to renovate his or her house again,” says Dan Cinelli, architect, principal and board director at Perkins Eastman. “And because of the last economic downturn, they basically said, ‘I don’t want to own anything anymore. I don’t want to worry about maintenance or another recession. I’d rather take the money and rent.’”

In other words, just because young seniors don’t want to move into “senior housing” doesn’t mean they don’t want to move. There are two main reasons that young seniors move into the active adult product:

1. An economic lifestyle — what comes from selling and moving

2. A social lifestyle — what comes from entering active adult

Boomers moving into active adult typically prefer renting over owning due to economic and logistical flexibility. They long for a sense of community, whether that means remaining in their long-time neighborhoods or cities, or moving to a new city to live closer to their adult children. They are healthy enough to not need traditional care-based senior housing, but they also do not want to move into multifamily communities where their lifestyles will conflict with younger residents.

Nor do they want to live with older residents. These young boomers view themselves as young, and they want a housing option that caters to that mindset.

Their view of themselves as young is more than just optimism. In 1972, age expectancy for 65-year-old Americans was 15.2 years. In 2017, 65-year-old men were projected to live more than 18 years, while women live 20.6 years, meaning the average 65-year-old in 2017 could expect to reach at least his or her mid-80s, with many people now planning for 90- or 100-year lives.

Through technology, diet, fitness and medicine, seniors in their 70s can also remain independent longer and better manage their chronic conditions. They are not moving into independent living as young as they once did. Ten years ago, the average assisted living resident was nearly 87 years old. Today, that’s a normal age for an IL resident.

Seniors moving into active adult do so for the socialization and active lifestyle, yet for many, there are economic factors as well. These factors often carry emotional weight, which impacts the buy process.

A Freddie Mac survey in April of 2019 showed that boomers face greater economic strain around housing than any other age cohort: 74% of boomers had to spend less in the past two years to afford their mortgage or rent, 48% had to put less money toward savings and 44% had to move.

In September 2016, only 10% of boomer respondents to a similar Freddie Mac survey thought that renting was more affordable than owning. That number is up to 17% now. And only 14% of boomers believe it is “extremely likely” that their next move will be a home purchase.

“A lot of these residents coming into these communities are widows or widowers, and they find themselves in a situation where they want to gain a sense of community, a sense of camaraderie,” says Carey Levy, president of Passco Companies Development. “We want to provide this quality living environment for them.”

The key draw into active adult, Levy says, is wellness — both physical and emotional. That means an emphasis on amenities, services and common areas that offer a range of opportunities for residents to both stay fit and socialize.

While the residents might be drawn to the physical and emotional wellness that active adult provides, the operators should be too. The top reason why renters leave active adult is that their care needs advance. For the active adult portfolios of both The Carlyle Group and active adult developer Avenida Partners, the average resident age is 72.

That’s about 10 years younger than the average independent living resident. If an active adult developer can facilitate a lifestyle that keeps residents both happy and healthy, their residents can spend that entire decade in active adult before they age into traditional senior housing.

“If we treat them right, I think we have an opportunity to keep them for a very long time,” Robert May, founder and managing partner of Avenida Partners, said at NIC. “And with our life enrichment programs, our intention is to focus on that wellness, to keep them healthy longer, so that they don’t have to take that next step.”

This article draws from the new report, “The Changing Face of Active Adult Rental.” Click here to access the complete report, which dives into the active adult collaboration and competition between senior living and multifamily, shows the data driving active adult development and illuminates the drivers that are leading young baby boomers to embrace active adult as a new living option.

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