Senior Housing Design Changes lead to Increased Profits without Compromising Resident Care

SCOTTSDALE, ARIZONA– Suntereo has been working with property management and architects to reduce its staffing at new communities. Scott Laten stated

"We have been working on ways to reduce our operational costs of our communities. Operational costs run from 63%-65% of total revenue. We have approximately 70 full and part-time employees at a community. Of our operational costs, salaries and benefits make up the lions share of total expenses.

“SMARTLY” eliminating three positions reduces operating expenses by approximately $120,000 annually. At current capitalization rates of approximately 7%, that translates to an increase in value of $1.7 million dollars. The trick and finesse are making changes that do not effect directly or indirectly safety, service or quality of care.”

Another area which is closely tied-in to staffing is design. We are no longer designing because the senior industry model is doing it that way. We are examining the way spaces are being used. It is frequently very different than our original design and anticipated acceptance and use. By more closely watching residents and "their" programming use of the space, we can add, adjust and expand spaces to meet our residents wants. Several years ago Donald Bren told me that "if we build something we want, the public will acknowledge that and let us keep it".

This is a perfect example of being wise and humble enough to allow the market to drive the design."