A 6-Bed Affordable Senior Living Model that Makes A Profit?

One person said, “This rescued me from seclusion”.

The following is an edited version of a conversation between Senior Housing Forum Publisher and Podcast Co-Host Steve Moran and Garden Spot Communities CEO Steve Lindsey about its “Grand Experiment” into affordable senior living. Listen to the Podcast HERE.

Moran: Steve Moran here with Senior Housing Forum and I am at the Environments for Aging Conference in Salt Lake City. Today I am talking to Steve Lindsey, who is the CEO of . . .

LINDSEY: Garden Spot Communities.

Moran: Okay, tell me a little bit about Garden Spot Communities, who you are, where you’re at, and what you do. So, let’s start with that and then we’re going to dig into the really cool thing I want to talk about.

LINDSEY: Okay, great. Yeah. Garden Spot Communities is a life plan community located in Lancaster County, Pennsylvania. We have two locations: our main location in New Holland has about a thousand residents and is spread over a couple of hundred acres. And then we have a smaller site about 10 miles away. We’re affiliated with the Mennonite Church not-for-profit organization.

Moran: How old?

LINDSEY: Coming up on 25 years.

Moran: Cool. Cool. So, uh, you’re actually here today this time at Environment in Aging . . . You actually did a presentation because you have done this really cool sort of single-family, small home, low-income thing. So why don’t you tell me a little bit . . .

Their Grand Experiment into an Affordable Co-Living Home

LINDSEY: This is a project that we’ve really been excited about. It’s something that we’ve kind of called our Grand Experiment over the last couple of years. We refer to it as cooperative living or a co-living model for older adults. We’ve been able to develop it in a way so that it is accessible for people regardless of income. The people who live there are on a month-to-month rental basis and they are on a sliding scale fee, 30% of income – no matter how low that income might be.

Moran: So, in terms of what it actually . . . what you’re actually seeing right now, what are they typically paying?

LINDSEY: Oh, anywhere from $150 a month up to $250, $300 a month.

Moran: Okay. And this is a house?

LINDSEY: It is a house.

Moran: So, sort of describe the physical environment to start with.

LINDSEY: Sure, well, yeah, it’s a residential scale home a little north of 3,000 square feet. It’s got five bedrooms, five-and-a-half baths, and the way it functions is similar to a co-living model. The people who live there have their own bedroom suite. So, the bedroom, bathrooms, and some storage area, that’s all private space and then they share the rest of the house together.

Privacy Plus Life “in Community”

And we think the beauty of that is that you have the privacy you want, but you also have interaction with other people. And one of the things we’ve heard from people who move in is they were living in isolation. One person said, “This rescued me from seclusion” before they moved in. And so that opportunity to be “in community”, to be in relationship with other people once again just has enormous impacts on not only someone’s emotional wellbeing and their social life, but also their physical health.

Moran: So, how do . . . do you provide any services, do you provide the food service, or did they do that themselves or do they cook together or how does that work?

LINDSEY: This is very much an independent living model, and they live in the house together. They do the chores, they do the cooking, they do the cleaning. We do provide building maintenance. We provide grounds maintenance, upkeep, snow removal, and all the utilities are included, Wifi, heating, air conditioning. All those sorts of things, trash removal.

And then we also have a social worker-case manager who works with the folks in the house just to make sure that they’re getting access to the services that they’re eligible for and making good use of the money that they do have. But then also just kind of assimilation into the house. And should there be any disruption of life there. We all know from our own families that there are times things go really well, and you’re really tight-knit and there are other times there’s just a little bit of friction. So, we fully expect to see that in a house like this as well and the social worker’s available just to go in and help to resolve those issues or mediate.

Moran: So how long has it been open?

Almost A Year’s History Behind Them

LINDSEY: It’s been open, uh, about nine months at this point and so, we’ve got a little bit of history behind us. We’re continuing to work with the group there and just understand the way life happens.

Moran: And so, you . . . have you had any big conflicts and how have you worked that out? And, sort of related to that, how did you make sure as you were selecting the residents, because I would assume you had more people than . . . who wanted to move in than you had space for, how did you make sure they were compatible?

LINDSEY: Yeah, well the beauty of the model is that it’s not dependent on any government funds. There’s no government subsidy that goes into it. And so that gives you the freedom to serve the local community. The people moving in aren’t on a county list somewhere and it’s next one up that gets placed in the house. So, we have a chance to do some screening for people who move in.

We place a priority on the lowest income individuals, but then there’s also that ability to fit with the rest of the group, that ability to integrate socially with the other folks in the house. So, we do have some screening that we go through, looking at income levels and looking at a few other factors, but then there’s an interview process. Ultimately the people who are living in the house have a chance to interview, to meet with that person, and they get the last say on who moves in or doesn’t move in.

Moran: So, have you had any turnover yet?

LINDSEY: We have had a couple of folks turned over. We had one person who lived there who had a significant medical issue and needed to move out, so we have had that kind of replacement of persons as it’s gone along.

Living “In Community”, People Keep An Eye on Each Other

Moran: What do you . . . so these are all seniors . . . over age 65, 62 . . .

LINDSEY: 62 and over . . .

Moran: As they age, and they start having increased physical, maybe cognitive issues, how do you expect to deal with that?

LINDSEY: Yeah. Well, one of the nice aspects of the house right now is that the people kind of look after each other. There’s that element of someone else is kind of keeping an eye to make sure you took the pills this morning, you know. Or, “Don’t you have a doctor’s appointment today? You need to make sure you get to that.” Or, “Do you need a ride to the doctor’s appointment?” kind of thing.

So, there’s that life “in community” that we think is going to have a significant impact on keeping people healthier longer. When people do need assistance, the opportunity to bring services in through home care or home health or whatever it might be is certainly available to the folks there.

We think that they’re going to be able to stay in that residence up through the personal care or assisted living level with services being brought in. And then, when they do need skilled care, we will assist them in finding an appropriate setting for them.

Moran: And when they need skilled care, the economics, at least theoretically, become a little bit easier because you’ve got Medicaid.

Or so, so, five residents, um, hundreds of thousands or millions of people who potentially need this level of care. This is like not even a drop in the bucket, right?

LINDSEY: Exactly, exactly.

Scaling the Project

Moran: So, what can the operators learn and how do you see the scaling, or do you?

LINDSEY: Well, I think there is opportunity . . . and one of the questions we’ve gotten is why five? Why only five? And for us, it was a couple of issues. First of all, we wanted to prototype it. We had not been able to find any similar models that existed targeting that socio-economic group. And, the opportunity to prototype something, to make sure it works, to refit it without a huge financial investment was significant for us. Um, so that was one.

The other is we wanted to create a model that would fit into a residential neighborhood. The location of the prototype model is right across the street from our existing campus. We have an opportunity there to do maybe five homes at that location, but then the larger plan is to move it out into the larger community.

This idea is that you could place a house in a residential community so people could stay in their neighborhood close to their social network. You know, their church, their family, friends, that sort of thing, but still have safe, effective, high-quality housing. So, we envision a network of these homes around their larger community.

But there’s also an opportunity, I believe, to, to put this into a multistory building. And if you look at some of the models of co-living that target millennials, that’s exactly what they’re doing. They’re building a hundred units, 150 units, multi-story and each level going up through provides kind of a co-living house. And then common space, you know, together on the first floor.

And I believe that there’s an opportunity to do that. It might be going in an urban renewal effort, taking an existing building and retrofitting that without a huge financial investment. And it could target that age group just as well.

Moran: Does it break even?

LINDSEY: It does. Yeah definitely. That’s the exciting part. And that’s one of the things we wanted to check out.

Moran: So, let’s talk about the . . . how did you pay for the building of it, first, and let’s talk about operations.

The Key to Success — Keeping Construction Costs Down

LINDSEY: Yeah. We went into it realizing that the key to success without using any government subsidy was going to be the ability to keep the cost of construction down. And what we did was to take this vision out to the larger community and solicit input and help. And we positioned it, not as a Garden Spot Communities’ effort, but as we were taking the lead in having a conversation.

And so, we coalesced a kind of a support network in churches and social, civic groups and schools and so forth to come together. And we said this is an opportunity for us as a community to make a difference in our community. We had a steering team that was made up of community members.

And then when we went out and started construction, we really relied on a lot of volunteer construction effort. We solicited people in churches and civic groups. When the first day that we placed walls in place, it was a local college, Franklin and Marshall College, [that] sent their incoming freshmen, a group of their incoming freshmen as part of their freshman orientation process over to help build this house.

Moran: Well, that’s cool. Yeah. So, it’s a little bit like the Habitat for Humanity model.

LINDSEY: Yeah, absolutely. And that opportunity for folks to come together to have an investment, to have a heart in the development was really significant for us and kept the construction costs at a reasonable level so that we were able to make it financially viable.

Keeping Operational Costs to a Minimum

Moran: . . . And then talk to me about operational costs.

LINDSEY: Yeah, operational costs are minimal. Like I said, we have a social worker who dedicates a portion of her time to this. Our maintenance guys will go over and repair things or update things. Our grounds crew does the snow removal or mowing the lawn and that, and utilities really comprise the operational cost. So, it is minimal because it’s an independent living model. You know, it’s not assisted living, it’s not another level of care. So, it’s targeted at housing.

Moran: And so, do . . . the things like the social worker and the maintenance and the snow cleaning, those kinds of things, do you charge that back to that particular project or is that something you absorb as part of your mission?

LINDSEY: No, we felt that especially as we went into this, that we wanted to do a real financial accounting of what the actual costs are. So, we do allocate all of those costs to the cooperative living house and we’re able to keep track. And, the good news as I mentioned, is it does pencil out. It’s in the black and we’re really excited about it.

Increased Pride and Staff Engagement

Moran: Well this is really cool because to me it seems like the kind of thing that whether for profit or not for profit, it’s sort of mission driven. And I could see it, because I’m so focused on work culture, I could see how team members would really get behind supporting something like this and feel proud of an organization that does that. Are you going to do another one?

LINDSEY: Yes. Yeah, absolutely. We are committed after doing the first one. We wanted to take a full year and just kind of learn from it. And so, as we come up on the conclusion of that first year, we know there’s some tweaks we want to make to the building. We know there’s some other things that we can do to make it more livable. We’ve gotten that feedback from the people who live there.

We’ve already started the land development process for the next phase and so we will move into that. And, uh, we’re just excited. We realized five people, as you said, it’s not a drop in the bucket . . .

Moran: . . . except for those five people.

LINDSEY: It makes a huge difference in the lives of those five people. But, I don’t think there’s any magic bullet that’s going to solve all the issues. But one of the things we’re convinced of is that the government is not currently keeping up with the demand for low-income, affordable housing. And as we approach this age wave, we don’t think they’re going to be able to keep up in the future.

So, it’s going to take a lot of organizations, a lot of communities thinking creatively about how they meet the needs in their own community and how they do things a little bit differently in order to make the difference. So, if this is something that others can replicate, that’s fantastic. If it’s just an inspiration for them to go and do something new, that’s even better. I think we can work hard. We can lean in. We can innovate and make a difference.

Moran: Well, Steve, thank you very much.