At a time when most attention in the seniors housing development market has been directed at assisted living and memory care, The Wolff Company is betting big on independent living, with a pipeline of 20 properties planned to open in the next few years throughout the western United States. Since its founding in 1949, the company has mostly focused on the multifamily space, but to build up its seniors housing team, in March 2014 Wolff brought on Mike Milhaupt, who has over 20 years of experience developing senior living properties at First Centrum.
Since welcoming Mr. Milhaupt, Wolff has broken ground on 11 IL developments throughout the West and has also purchased three senior apartment communities. In addition to those 11 properties under construction, the company also has nine in various stages of pre-development. So, Mr. Milhaupt expects Wolff to open three or four new IL communities every six months, or so, with the first three set to open early next year in Colorado Springs, Colorado, Henderson, Nevada, and Oxnard, California.
Costs should average around $275,000 per unit for the portfolio (which would, of course, vary based on location), and the average size is around 140 units. And a minority of units in several communities were built to code for an AL conversion in the future, if Wolff or another owner so chooses. In addition, knowing that with the average move-in age of independent living residents rising and the wave of Baby Boomers still years away from reaching that age, Mr. Milhaupt has underwritten based on either four or five move-ins a month, a relatively conservative rate.
Newport Beach, California-based Clearwater Living will manage the portfolio, and Wolff is financing the pipeline with their own equity and conventional bank loans from a number of local and regional banking relationships.
