Development and Marketing Experience Jump-Starts Not-For-Profit CCRC Community
When it opens in summer 2017, Heron’s Key will welcome residents with a choice of senior living residences and beautiful views of the wooded area around Gig Harbor, Washington. The not-for-profit Life Plan Community, also known as a Continuing Care Retirement Community (CCRC) in the Seattle area is being developed for Emerald Communities of Redmond, Washington.
Heron’s Key will be Gig Harbor’s first Type A CCRC, a designation that will allow the community to continually accommodate residents’ changing needs as they age. The community will be home to more than 350 residents in 194 independent living residences (including 10 duplex-style cottages), 36 private assisted living suites, and 45 private skilled nursing rooms. A full complement of restaurant-style dining options, fitness and wellness facilities, landscaped and wooded nature trails, and other amenities also will be offered for residents’ enjoyment.
Situated on 18 acres, the campus allows for the construction of an additional 88 independent living residences, 32 memory care assisted living suites, and other amenity spaces (pool, auditorium) expansion at a later date.
Putting Experience to Work
Heron’s Key represents the second senior living community sponsored by Emerald Communities and the largest development that the City of Gig Harbor has ever approved. This, plus the need to satisfy all the requirements for a Type A CCRC, led the board to select LCS Development (LCSD), An LCS® Company, as its development partner for the project in 2011.
With more than 40 years’ experience in senior living development, LCSD is able to bring comprehensive development and marketing services to the project. The company achieved an exceptional pre-sale reservation rate which allowed the financing to be secured and construction to begin ahead of schedule.
Community Development Project
- Early on in the real estate development process, LCSD negotiated an option for the purchase of an additional eight acres adjacent to the site. By working with the Seller and the municipality to adjust the allowed entitlement from the expansion area to other parcels Emerald Communities was able to expand the size of Heron’s Key from 10 to 18 acres for little additional cost. This negotiation was essential to the success of Heron’s Key site planning and overall project feasibility.
- Working with project architect RFM of Bremerton, Wash., LCSD’s internal team of architects provided oversight during plan development to help manage the predictability and the reliability of the design and budget. LCSD will also serve in an oversight role during construction of the project, working with the contractor, The Weitz Company of Des Moines, Iowa.
- Early plans for the community allowed for 180 independent living apartments. LCSD and RFM worked to gain authorization from the city to allow an additional level of wood construction for the independent living building. This yielded an additional 14 apartments enlarging the community to 194 apartments, which enhanced the financial viability of the project.
- LCSD assisted the project team to obtain all necessary licenses, permits, and approvals required for the project, such as certificates from the Department of Health and approvals from the City and its planning and zoning board, and design review board.
- A September 2013 feasibility report, prior to the start of apartment sales, projected financing to be in place by late spring 2016. Instead, LCSD assisted the financing team led by Ziegler to secure $145,055,000 in bond financing for the community more than eight months ahead of schedule.
Marketing & Sales
- An initial interest survey indicated potential residents needed more information about the CCRC concept. In response, LCSD held a series of educational workshops to build interest and answer questions.
- From September 2012 to October 2013, the community secured 229 Priority Sales Deposits from individuals interested in Heron’s Key as a prospective residence. These fully refundable deposits allowed prospects to secure a priority position to select their residences when sales began and also allowed the group of early supporters to serve as sounding board for decisions impacting the senior living development.
- The team secured a harbor-front sales office location with a “million-dollar view” to provide a pleasant, local place that set the stage for strong resident sales.
- LCSD worked with Emerald Communities to build the Heron’s Key marketing and sales team, helping to recruit and evaluate the advertising and public relations agencies, select and train sales staff, and guide the sales and fill-up process.
- In the 20 months preceding the close of financing in August 2015, LCSD worked with the Heron’s Key marketing team diligently to convert Priority Program members into resident sales, averaging 6.5 sales per month.
- By the time financing closed, LCSD had achieved a 70% reservation rate. An 80% reservation rate is anticipated by the time the community opens in the summer of 2017.
- LCSD worked with Emerald Communities to recruit and train selections staff and guide the process of residence personalization and move-in. This helps assure that Heron’s Key Charter Members remain engaged and are retained during the construction phase of the project.
Partnering for Success
LCSD finished the Heron’s Key development ahead of schedule and within budget, with an additional 8 acres of land negotiated for little additional cost — helping to ensure the success and continued growth of this senior living development.
“No single owner will have the breadth of experience or resources to handle all of the details that go into a CCRC,” says Jason Jorgenson, senior project development manager for LCSD. “This is a process you don’t want to take on alone.”
Emerald Communities board member Bob Crist concurs. “I would describe our relationship with LCSD as terrific,” he says. “They have helped us through this process. Their folks are bright, capable, dedicated, and a good team to work with. They’re good partners.”
If you don’t have experience carrying out new development projects, our biggest recommendation is to surround yourself with people who do. The LCS Development team will collaborate with you to help ensure your project meets its goals each step of the way.
To learn how we can help you reach your development goals, get in touch. We look forward to discussing your next project.