For decades, the Baby Boomer generation has made a huge impact on the U.S. economy. Now, this well-known group is starting to move into retirement, creating a so-called “Silver Tsunami” of new retirees. The coming population wave is poised to make a big splash on the multifamily and senior living construction markets.
According to the Population Reference Bureau (PRB), the number of Americans ages 65 years and older is projected to “more than double from 46 million today to over 98 million by 2060.” If this swell in numbers hold true, the demographic will eventually make up 24 percent of the total population. The PRB also predicts this generation could lead to a 75 percent increase in seniors requiring nursing home care (specifically, 2.3 million by 2030, which is up from 1.3 million in 2010).
While the future construction of senior living facilities is bound to grow to match this need, for the time being, some markets are facing challenges of oversupply. In an interview with Senior Housing News, Beth Mace, chief economist at the National Investment Center for Seniors Housing & Care (NIC), said senior housing facilities in Houston, San Antonio, Las Vegas, Dallas and Atlanta all had occupancies below 84 percent near the end of 2018. However, Mace did point out that these communities will eventually fill up due to the coming wave of baby boomers.
For now, it’s up to building industry professionals to make the most of the calm before the storm. With the ongoing labor crunch, identifying ways to meet the impending boom and produce high-quality, multifamily and senior living facilities quickly and affordably may very well be at the top of the list. Prefab construction is one tool a growing number of developers and contractors are already using to achieve these outcomes. Built under controlled factory conditions, modular units arrive at the jobsite ready to install, minimizing onsite assembly work, reducing the need for qualified trade workers and speeding projects to market.
Prefab construction is currently considered a progressive, alternative construction method, but experts note it’s turning more and more mainstream. In fact, the National Institute of Building Sciences’ 2018 Offsite Construction Industry Survey reports “prefabrication in a controlled, off-site environment may become a necessity for many U.S. contractors attempting to remain competitive with a lower-skilled workforce.” On a similar note, Jobsite rated prefab and modular units as one of the top five construction trends to watch in 2019. Duane Craig of Jobsite explains, “The labor shortage, materials prices, and interest rate increases will cause developers to look for ways to remove risk and speed up projects.”
With the cost of senior living construction on the rise, modular, prefab construction is a natural counter-measure to the growing cost of labor and building materials. Even better, it can help developers catch the incoming wave of retirees as the Silver Tsunami hits the senior housing market.
If you’re ready to make use of the calm before the storm and learn more about how prefab can shave time off construction schedules while improving quality in senior living/assisted living facilities, contact Bill Seery, Oldcastle SurePods vice president of business development, at Bill.Seery@oldcastle.com. Over the last five years, we’ve made it a priority to put prefab into practice in these critical markets. We’ve worked on numerous successful projects and seen firsthand how the use of modular bathroom pods allowed facilities to open earlier than possible with traditional construction.
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