United Properties triples its commitment to senior housing

Senior housing has been a minor part of United Properties' development pipeline for the past two decades, but the company is now making a major commitment to the fast-growing sector.

The Minneapolis-based developer says the company plans to triple the number of senior housing projects it builds over the next few years.

Those projects, and most of the senior housing communities it has already developed, will also be part of a new branding strategy, including a new name: Amira.

"Everything about it, every indicator about it is positive," said Matt Van Slooten, co-president and chief investment officer for United Properties Investment. "It's a need in society that's going to be growing dramatically. COVID slowed down that growth and need, but it is coming back. We're in it for the long run."

Senior housing accounted for just 9% of the value of United's long-term holdings three years ago, with the rest being a mix of industrial, office and retail properties. Van Slooten expects that figure to increase to about 40%.

United already has 10 communities open and operating, with three more under construction. The developer aims to have another 30 open or nearly completed within the next four years in the Twin Cities, Denver, Austin, Texas, and select cities in Florida.

The company is consolidating its various senior-living brands under the Amira banner.

United's existing cooperative communities, which are owned and operated by residents age 62 and older, will continue to be known as Applewood Pointe, while future coops will be developed under the Amira brand.

Van Slooten, who manages United's division focused on its long-term holdings, said the decision to expand these offerings is based on strong, growing demand for senior housing rather than any weakness in other parts of the market.

United is making a big bet that a swell of seniors are getting serious about where to spend the next phase of their lives, and United will offer an array of environments, from fully independent to fully assisted options. The cohort of Americans age 75 and older is projected to grow from 23 million to 43 million in the next two decades, the company said.

Many developers in the sector today are either new to senior housing or are building these facilities for other investors and operators; United is focused on long-term ownership of the properties.

Though the company partners with other organizations and companies that operate the buildings and manage the services, Van Slooten said the company is a hands-on partner influencing how the operations are managed.

The company's RBC Gateway tower project in downtown Minneapolis includes a luxury hotel and condominiums, and it is pursuing more traditional rental projects in other states, including Texas.

Going forward, though, United's long-term residential holdings will focus on senior housing, a sector that other Twin Cities developers are also embracing.

Mary Bujold, president of Twin Cities-based Maxfield Research, said many developers will dip their toes in the sector, but because of the complexity of owning and operating these projects, they often retreat. Still, she's getting more requests for market studies for senior projects.

"We're now seeing a lot more demand for that product," she said. "I think there's significant growth potential."

Twin Cities-based Ryan Companies, for example, has built more than 50 senior living communities throughout the country, including about 1,000 units in the Midwest in just the past two years.

Twin Cities-based Doran Properties Group recently also secured approval for a 201-unit senior housing development in Maple Grove, and St. Paul-based Real Estate Equities recently completed its income-restricted senior living project in Brooklyn Center.

Bujold said that as baby boomers age, their housing needs will change, so United and other developers will have to be nimble and pay close attention to the needs of today's aging population.

"We know that baby boomers are going to demand something different," she said. "I'm not sure exactly what that'll be, but I know it won't be the current product that's out there."

Van Slooten said that United's deepening commitment to senior housing reflects the company's interest in meeting those long-term needs. For now, he said, the focus will be on creating a sense of community that's tailored to the specific region where the project is built. Across the company's senior portfolio, that starts with a new, cohesive brand name. Amira, he said, was chosen for the brand because the term is often translated as "treetop" or "upper branches."