In addition to being subject to medical healthcare certifications, structural certifications, food service certifications, and compatibility of special-needs patients, federal agencies maintain concurrent jurisdiction to both inspect and evaluate a senior living facility.
OSHA Compliance
The Occupational Safety and Health Administration (OSHA) has conducted studies of mishaps involving both staff and residents in senior housing. Wise developers keep a keen eye toward these reports in developing the floorplan to best provide for the resident. Especially when developing a specialized product type for a certain type of user, OSHA should be one of the major guideposts your project manager or construction manager follows in the floor planning of the project. Furthermore, experts acting in concert with developers best serve technical considerations of the facility design, such as the likelihood of resident movement and the need to accommodate special equipment, such as mechanical lifts.
As agencies like OSHA set the tone, the private market developing residential care for senior citizens will undoubtedly follow in line to embrace improving standards. To illustrate, the federal government is always seeking best practices for policies and improvement, and with such a political force with organizations such as the AARP, new legislation may incorporate this sentiment.
In one example, “Wyandot County Nursing Home in Upper Sandusky, Ohio, has implemented a policy of performing all assisted resident transfers with mechanical lifts, and has purchased electrically adjustable beds. According to Wyandot, no back injuries from resident lifting have occurred in over five years.”
Facility Value Enhanced through Safety Compliance
OSHA compliance is not just good for mitigating risk in the operation of the senior living facility, but it provides for a much higher investment horizon when discussing replacement costs in the event of resale of the senior housing investment development. OSHA-compliant floorplans should also be built out with consideration that healthcare or senior care providers and operators may be subject to additional, new, and possibly unpredictable laws in the future. As such, impeccable compliance may draw more bids. These, along with other considerations that account for future laws or regulations, are key for repositioning the senior facility in the marketplace for disposition of the facility in a portfolio upon one distant day.
For now, however, there should be less disposing and more acquiring of senior housing product in real estate. Why? Because demand is there. To illustrate the heating up market for senior housing facilities, one sale of a senior care facility attracted as many as 30 bids before ultimately closing on a $145 million dollar sale in 2014.
Not only will thoughtful compliance from day one of managing the development with a design team avoid unnecessary exposure to liability, a thorough understanding of the best practices for floor spacing designs unique to this specialized field of caring for the elderly is encouraged. No real estate developer is specifically required to know everything about senior housing, but as an advisor, Cambridge Realty Capital can help even the novice developer in an opportunity that will put careful consideration into implementing an excellent design team for maximum per square foot value.
