The American Senior Housing Association (ASHA) and leading national construction firm The Weitz Company have published the results of their bi-annual Senior Housing Construction Cost Data Special Issue Brief.
The tight labor market continues to evolve into a top-tier issue for several markets, causing higher than expected cost escalation for current projects and especially those which are near commencement. The need for labor is resulting in companies challenged with keeping good employees and preventing defections to the competition. Skilled labor/trades are seeing the highest incidence of this and companies need to be mindful in maintaining their core staff. The number of new, young workers entering the trades are not keeping pace with the aging workforce that is advancing through the ranks or leaving the trades altogether. The overall impact is not only cost but a real potential for a slowing of schedules and firms trying to do more with less. The expectation is for these cost escalations to continue creeping upward at a higher than normal rate over the next 9 – 12 months based on current data.
About the CCRC and Senior Housing Construction Cost Data Special Issue Brief
The bi-annual CCRC and Senior Housing Construction Cost Data Special Issue Brief is released every Summer and Winter, and is based on nation-wide data of senior living projects under construction or completed by The Weitz Company. Costs are full burden and include general conditions, insurance, tax, bond and fee, but exclude site construction costs. The costs are based on a city index of 100. Each city carries a different index. These indices, coupled with local market conditions, are essential when comparing overall pricing.
*Full Burden: Costs are full burden and include general conditions, insurance, tax, bond and fee, but exclude site construction costs. The above costs are based on a city index of 100. Each city carries a different index, for example: Gainesville, FL has an index of 85.7 which translates to a cost range of $110 – $141 per sf for Independent Living; Chicago, IL has an Index of 117.6 which translates to a cost range of $150 – $194 per sf for Independent Living. These indices coupled with local market conditions are essential when comparing overall pricing.
Mid-Level: Generally wood-framed with standard amenities and finishes, typically targeting the moderate income senior.
High-Level: Generally steel or concrete construction with high-end finishes and luxury amenities, typically targeting the higher income senior