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Business Q&A -- Dan McFarland How has the growth of senior and assisted living residences in the Rogue Valley compared to other areas of Oregon? One source says that the Rogue Valley is the 11th most popular retirement location in the United States. However, the industry's growth has been phenomenal throughout the United States. Thus, the growth we have witnessed in the Rogue Valley is happening elsewhere as well. At the present, most industry experts believe that the market is overbuilt. The state of Oregon recently placed a two-year moratorium on the licensing of new residential care and assisted living facilities. How much does the typical senior facility cost to build and what makes it attractive for corporations to enter the market? Generally between $7-$15 million, depending on how large and elaborate of a property you intend to build. In the last few years the growth of the industry prompted a few outside corporations to get involved with the business. Some of these new operators quickly discovered that the successful operation of retirement and assisted living communities is not as easy as it may have first appeared. Nonetheless, a corporation can achieve respectable profits if they have a good reputation and can manage their business efficiently. What are the greatest challenges for your industry? Developing new and creative programs and services to enhance the lives of seniors - staying ahead of the competition. Another significant industry challenge is trying to curb the over-development of regulatory restrictions that have plagued the skilled nursing industry for years. This should be a primary goal of the industry because the costs associated with regulation and oversight is passed on to the consumer. One of the biggest appeals to assisted living has been that a person can receive care at a rate much less than nursing home care; generally about half the cost. What are the advantages of a totally private-pay retirement residence, such as Anna Maria? The advantage is that we don't have the red tape to go through as far as processing. Our residents pay rent on a monthly basis and we don't have to depend on reimbursement from the state. I know from talking to competitors that are dependent on state aid that it has gotten tougher because the market has been overbuilt. The reimbursement rate is set up by the state, so that can pose some pretty significant operational restrictions. How many people are financially prepared for this stage of their lives? I think very few. Generally seniors look at their overall health and well-being as being pretty positive. Generally when somebody moves into a retirement community there's been a crisis - either a broken hip or a health matter that prompts them to start looking at retirement living arrangements. But few are as emotionally and financially prepared as we would hope. Time gets ahead of us. The American dream is to purchase a home and to live in it for a number of years. And that is still the desire among seniors. Generally when they're faced with crisis or have to make a decision, they're not prepared or as well prepared as we'd like. Some are and some are unique and very prepared. They start looking at retirement-living options before there is a health issue. If they do their research and prepare, they'll find success. If they delay, there can be some pretty negative consequences. What are the chief differences awaiting the baby boom generation? One of the nicest things I've observed in this industry is the reaction that I've received from the sons and daughters and family members of seniors, who are looking at this for their parents and grandparents, and they observe the lifestyle at a retirement community and they like what they see. Unfortunately, a lot of older people would view retirement living in the same realm of the nursing homes that they remember. Their sons and daughters of the baby boom generation tend not to do that, they recognize the difference. Gone are the stark hallways with linoleum floors and the odors; there's a more hospitable environment. To suggest a subject for this column, please contact business reporter Greg Stiles at 776-4463 or e-mail [email protected] Mail Tribune Home | Ottaway Newspapers, Inc. | Dow Jones & Co., Inc. | Privacy | Contact Us Copyright � 2001 Mail Tribune, Inc.