Over the next four decades as the nation's baby boomers age, more than 48 million people are projected to be added to the ranks of the 65 and older population. What's even more staggering, the 85 and older population is expected to more than triple from 5.8 million in 2010 to 19 million in 2050, according to the Center for Housing Policy.

“The reality is we are not prepared at all, not in Social Security, not in Medicare, not in housing, definitely not in housing,” says Laverne Joseph, president of the California-based Retirement Housing Foundation, which owns 160 communities, nearly all serving seniors, in 26 states. The nonprofit's residents include 60 centenarians.

RHF recently completed a $43 million rehab of its Angelus Plaza development in Los Angeles, the largest affordable housing community for seniors with 1,093 units.

About a year ago, RHF announced it would open the waiting list for an apartment on a Monday. People began lining up Sunday evening, and by the next morning the line stretched several blocks. Administrators passed out 4,000 applications to seniors just hoping to get on the list. Roughly 2,400 people met the age and income requirements for the property, which serves seniors 62 and older who earn no more than 50 percent of the area median income.

“Some people will never get to the top of the list,” Joseph says.

The need is only going to increase.

“Many factors will contribute to a large demand for affordable housing for older adults,” says Emily Salomon, state and local policy coordinator at the Center for Housing Policy. “There's an enormous increase in population size, with the 65 and older population doubling and the 85 and older population expected to triple by 2050.”

Those sheer numbers indicate that there will be a huge wave of people looking for affordable housing.

As people age, cost burdens increase, according to Salomon, one of the authors of the Center's recent report, “Housing an Aging Population: Are We Prepared?”

Older adult households are more likely than younger families to spend more than 30 percent of their income on housing, a threshold for determining if one has a housing cost burden. People paying 50 percent or more of their income on housing are considered to have a severe cost burden.

According to the Center, there are 9.6 million households 65 years and older that have a moderate or severe housing cost burden.

The shadow cast by the Great Recession also looms large. Although the picture is not entirely clear, the fear is that many middle-age families have fallen underwater due to job losses and foreclosures. They have used up their savings, and as they age they will continue to be financially strapped.

The other critical concern is health. Salomon points out that a large number of older households have members with disabilities.

Shrinking funds

As all signs point to a fast-growing need for more affordable housing, funding to develop projects is shrinking.

“As the population is growing, the appropriations and supply are dropping,” says Bill Kelly, president and CEO of Stewards of Affordable Housing for the Future (SAHF), a network of 12 social enterprise nonprofits. “We've reduced our investments, there are long waiting lists, and we need to step it up.”

Tom Slemmer, president and CEO of National Church Residences (NCR), agrees. “Affordable housing production is going to be in great stress,” attributing this to budget cuts and the aging affordable housing stock.

“We're losing affordable seniors housing faster than we're able to build,” he adds. “I think it's a serious problem. As we show cost effectiveness more clearly, we're hoping to shift opinions so affordable housing will be seen as a worthy expenditure by the government.”

Kelly points to the downsizing of the Sec. 202 program as one of the culprits. “It's gone from a very large program to a small program to nothing,” he says. In the 1970s, tens of thousands of Sec. 202 units were built for seniors. But those numbers trickled down to 3,000 to 4,000 a year, with no new money for the program in the fiscal 2012 HUD budget. The Housepassed bill for fiscal 2013 includes $50 million for new Sec. 202 units, but that figure is not set in stone since the House and Senate will approve a six-month continuing resolution in September to keep the government running.

RHF relies on a number of funding sources, including low-income housing tax credits (LIHTCs), tax-exempt bonds, and the Sec. 202 program, to build its communities.

Back in the 1980s, it wasn't unusual for the organization to be developing 10 new Sec. 202 properties at a time. In 2007, it opened two, and in 2010 it opened just one project but acquired several others, according to Joseph.

The LIHTC program is the nation's main financing tool for building affordable housing, but it is not limited to seniors housing. It is called on to finance family, special-needs, and other housing communities.

In 2010, states allocated an average of about 26 percent of their tax credits to seniors housing, according to the National Council of State Housing Agencies' latest factbook.

In August, Congressman Joe Baca from California introduced H.R. 6295, which aims to encourage more affordable housing for seniors through the LIHTC program. The bill calls on states to award additional points to developments serving moderate-income seniors.

Even with a sizable LIHTC award, developments almost always have a funding gap. Key sources of funding that have been used to fill that hole have been recently eliminated or reduced, including California's local redevelopment agencies and the federal HOME program, Joseph says.

The services component

With the growing number of seniors, decreased retirement savings, and spiraling health care costs, some in the affordable housing industry are developing solutions to house this population and give them a better quality of life.

Providing a host of supportive services for seniors is key in keeping residents healthy longer and monitoring the needs they already have.

“One of the things that we tell people who are getting into seniors housing, it's not just bricks and mortar anymore,” says Larry Minnix, president and CEO of LeadingAge, a trade association for nonprofit seniors housing and nursing care providers. “If you're not considering the inclusion of a package of services, then you're shortsighted in your planning.”

LeadingAge is working with a host of organizations to identify best practices in seniors housing with supportive services.

“We believe that special attention given to low-income vulnerable seniors has a payoff for every community. We believe it has a payoff of health care cost reductions,” Minnix says.

SAHF and LeadingAge are teaming with Enterprise Community Partners to launch a national housing with services learning collaborative where they'll invite several dozen seniors housing organizations to submit applications. “We'll take approximately 10 to be committed the next couple of years to developing seniors services with applied research to begin to gather data for the housing and health care policy changes that need to occur,” says Minnix.

The organizations will meet periodically, share information among themselves between meetings, and share publicly what they're finding.

“One of the drivers is to see if supportive housing for seniors as an alternative to long-term institutional care is health effective and cost effective,” says Kelly.

LeadingAge also announced in early August that it has teamed with NewCourtland Foundation to provide $100,000 in grants through its inaugural Innovations Fund for projects that address bringing housing and services together to meet the needs of lowerincome seniors. As part of the collabora tion, the NewCourtland Foundation will work with LeadingAge to administer the grants, which will be awarded in increments of up to $25,000 in the first year.

The Mercy Housing model

Providing supportive services is a priority for Denver-based nonprofit and SAHF member Mercy Housing.

“We have a program model that says we have to focus on service efforts that will generate positive health outcomes for our seniors,” says Jane Graf, Mercy's COO.

Graf says there is a lot of focus on socialization to keep residents active as well as providing access to quality food and nutrition skills. The nonprofit is starting to put into place a chronic disease self-management program designed by Stanford University that helps residents stay focused on their symptoms and treatments and is working on a fall prevention program. Many times, falls can lead to declines in health or other highcost care for the elderly.

For affordable housing owners, it's also important to become an aggregator of services. “We don't want to duplicate anything that's already available in the community,” Graf says.

But Mercy is also creating a model to push the boundaries of housing and health care.

“We need to keep people out of nursing homes until the very last minute,” Graf says. “Providing a supportivehousing environment with certain interventions at so much less cost is one of the answers.”

Its Mission Creek Senior Community in San Francisco, which focuses on a higher level of service need and includes an adult day health care center by SteppingStone on site, demonstrates this. The adult day health care center is licensed and can provide a high level of medical support to seniors in combination with what Mercy support staff provides.

The San Francisco Department of Public Health has partnered with Mercy to provide housing for 50 individuals from the city's public nursing home. The seniors pay a share of their housing, with the health department paying a subsidy on top of that.

Of the original 50 resident referrals, 47 stabilized and were able to maintain out of nursing home care. The residents' Medicaid and Medicare costs shrank by $28,000 per year per person, amounting to $1.4 million in cost savings.

“A very supportive environment demonstrates what we believe is one of the many answers to the future of how we're going to deal with an aging population who is living longer and has health complications. We might not be healthier, but we're going to live longer because of modern medicine,” Graf says. “People should be able to live in dignity until their end of life, and we also need to do it in a fiscally responsible way.”

Mercy Housing is driving the independent long-term care model and is looking for a health care plan that is willing to partner and push the boundaries of Medicare and Medicaid to demonstrate the cost savings and effectiveness.

“The housers are essential. We're the foundation, and then we add to it with our services package. Then you put the medical service delivery piece on top of that. You've got to have all the pieces, they're all essential to the health of that senior. Medical care alone won't do it; housing alone won't do it. They need to come together,” says Graf. “With the Affordable Care Act, we have to look at this in a new way.”

NCR's health care approach

Columbus-based nonprofit and SAHF member NCR also continues to push the envelope on combining housing and health care. NCR provides a full range of seniors services, including independent living, home care, assisted living, hospice, adult day care, and nursing homes. It employees 3,000 people, with half on the housing side and half on the health care side.

Dr. Mike Barber is the chief medical officer for NCR and has been with the organization for about a year. He has been working on what model would work best in affordable housing to produce better outcomes and lower the costs for the residents.

NCR launched earlier this year its medical home pilot program where an integrated person focused on primary care would be on site in four differing service environments, including adult day health centers, retirement centers, independent living, and a supportivehousing project. In addition to service coordinators in each building, who help to engage residents in programs like chronic disease self-management and connect residences with services such as transportation to and from the grocery store and doctor visits, nurse practitioners will be on site. They can put in place comprehensive care plans for residents and be available for urgent care. The on-site team will be focused on better care, better health, and lower costs for the residents.

“Affordable housing is a successful intervention. If you can add to that with case management and primary care, you'll have a home run,” says Slemmer.

NCR also has a new development under construction called National Church Residences Avondale in Dublin, Ohio, that is a first for the organization. The 100-unit project for seniors 55 and older will be the first time the nonprofit is offering adult day health right on the campus. “It's the first time we're intentionally developing a community care setting in housing,” Slemmer says.

The project, which is financed with LIHTCs and Sec. 8 funds, will include a central community building for the adult day health center and a doctor's office.

“We think this [type of housing and services] will be funded in the future because it's solving more complicated problems,” adds Slemmer. “We know we're helping seniors, and we hope in the process we'll convince policymakers this is a better solution.”

Catering to the Seniors Workforce

New seniors workforce housing by Gorman & Co., Inc., will open this month in downtown Phoenix.

“It's not your grandmother's seniors housing project,” says Brian Swanton, Arizona market president of Gorman. “This project is really designed for active seniors.”

As the population continues to age and stay in the workforce longer, it's important to have centrally located housing. Lofts at McKinley, which will serve seniors 55 and older earning 40 percent to 60 percent of the area median income, is located less than a quarter-mile from a light rail station and is next to the business center downtown. It's the first new seniors development to be built in the downtown core in years and the first project to be approved under the city's new form-based zoning code.

Gorman partnered with Arizona Bridge to Independent Living, which is the state's largest accessibility service provider, to create housing that is 100 percent accessible for the disabled. The nonprofit will provide education, employment, and supportive services to residents with disabilities.

“This is really independent living,” says Swanton. “But the accessibility nature of the project allows folks who are physically disabled to stay much longer on their own.”

There's also a clubhouse room with shared artists' workspace, a major focal point where the residents can congregate. “We're looking at ways to not just provide housing that's appropriate, but to stimulate minds and activities in the community. Seniors are an active, vibrant part of the community.”

Nonprofit Downtown Phoenix, which promotes economic development in the city's core, also partnered on the $14 million project, which was financed with low-income housing tax credit equity syndicated by Boston Capital and HOME funds from the city and state. —C.S.

Answering the Need

The Mirabella was almost an affordable housing development for families.

Developers initially considered building a community for young couples and the general population, but instead they created 172 units of affordable housing for seniors in San Antonio.

The move was critical, satisfying nearby residents who objected to more family apartments in the neighborhood and answering the needs of the region's growing population of older residents.

The number of people 65 and older in Texas will swell by more than 3.1 million between 2000 and 2030, a 150 percent increase, projects the Census Bureau. In comparison, the state's overall population is expected to increase just 60 percent during the same period.

The San Antonio metropolitan area, which has about 235,000 seniors, has already seen its elderly population grow by about 38.5 percent between 2000 and 2010, according to the Office of the State Demographer.

The $19.9 million Mirabella was developed by The NRP Group, a leading affordable housing firm, and the San Antonio Housing Authority (SAHA). SAHA has built four seniors communities in the last five years.

Serving low-income residents 55 years and older, the development was completed last year.

During the course of the project, “we went from the best time to the worst time in finance history,” says Dan Markson, NRP senior vice president.

The development started out when lowincome housing tax credit (LIHTC) prices were strong and all the numbers penciled out. However, by the time the developers were ready to close on their financing, the economy had crashed and the financial markets had nearly shut down. The deal had a roughly $5 million gap in its development budget.

The project managed to stay alive with a financing package that includes tax-exempt bonds and 4 percent LIHTCs. Boston Capital was the LIHTC syndicator, investing about $6 million into the project.

The sizable gap was filled through the Tax Credit Assistance Program, which was created under the American Recovery and Reinvestment Act of 2009 to help affordable housing developments through the financial crisis.

The Mirabella, which features solar heat and water, is the first multifamily housing complex to receive Build San Antonio Green level 1 certification, a regional green building program, says Lorraine Robles, SAHA assistant director.—D.K.


Gearing up for Aging Alaskans

Alaska is getting old fast. Its population of residents 65 years and older grew from 35,699 in 2000 to 54,938 in 2010, a 53.9 percent increase, more than any other state.

And, there's more to come. Between 2000 and 2030, Alaska's older population is projected to expand by a whopping 256 percent, estimates the Census Bureau.

To help meet the need for seniors housing, Cook Inlet Housing Authority (CIHA) completed Eklutna Estates in 2010. The Anchorage development is part of a larger seniors housing campus called Centennial Village, where CIHA has six seniors housing developments with a total of 367 units.

Eklutna Estates is a mixed-income community with eight market-rate units and 51 affordable apartments for seniors earning no more than 50 percent and 60 percent of the area median income.

The local market could easily absorb more units, but balancing the state's high construction costs with debt-carrying capability continues to be one of the biggest challenges. Without development subsidy it is difficult to make market-rate and affordable projects feasible, says Jeff Judd, executive vice president of real estate at CIHA.

The approximately $22.8 million Eklutna Estates was financed through several sources, including low-income housing tax credits, the Tax Credit Assistance Program, the Native American Housing Assistance and Self Determination Act, and the state Senior Citizens Housing Development Fund. —D.K.

Combining Design and Services

For Boston-based Beacon Communities, design, programs, and amenities that improve residents' daily lives are priorities in its seniors developments.

“For a long time, we've been trying to figure out what we should be doing with elderly housing,” says Pamela Goodman, director of development at Beacon. “The people who have resources have a lot of options ”¦ but for people who have limited resources, they have very few options.”

As Beacon got more interested in seniors housing, the development team created its Living Well by Design philosophy, which it's incorporating into new construction and into its existing portfolio. This philosophy focuses on universally accessible design and social and supportive services, tailored to each specific property's residents' needs.

“It means really integrating the physical with the programmatic,” says Goodman. “It's really the first in the health care chain. The longer you can keep people independent in their own homes, it's better for them and better for society.”

Special attention is given to functional room layouts, flooring, lighting, and bathrooms. “We've moved toward more showers than bathtubs,” says Goodman. “We've really tried to figure out what we think this population needs in order to make it easier on them to live in their apartments, especially as they age.”

The developer used this Living Well by Design philosophy in its Ocean Shores Apartments, which is a 55 and older community in Marshfield, Mass., that was completed in early 2011.

The building is universally accessible to help residents age in place, and 5 percent of the units are fully accessible to those with disabilities. All of the units are fully adaptable.

Comprehensive surveys are done at each property to understand residents' needs. At Ocean Shores, residents are taking advantage of computer training, social activities like barbecues and line dancing, and the new community gardens in raised beds that were installed in August. On the health side, a visiting nurse comes once a month in the summer and every other week the rest of the year. —C.S.