Senior Housing
Investment Strategy
BRP-SH focuses on the development of Class A, new generation senior housing projects designed to satisfy the higher standards of today's more demanding residents. Our strategy is to create private pay rental communities as an attractive alternative to existing entry fee-based Continuing Care Retirement Communities. The rental model, with the same full range of senior housing options, is easier to understand and more affordable for residents, and offers a more traditional model for investors.

Most of our senior housing communities are a mix of independent living, assisted living, and memory care, all private pay sectors. A facility that contains all three sectors is referred to as a Continuing Care Retirement Community (CCRC). Traditionally, CCRCs have been funded by an entrance fee model. In this model, the resident pays a fee but does not own any real estate interest. A part of the fee, up to 95%, may be returned to the resident or the estate depending on the scheme. In addition, the resident pays a monthly fee to cover operating expenses. That fee is to be fixed no matter what level of care the resident receives. This is called a Life Estate. BRP-SH believes this model, which is regulated by states, is unsustainable long-term as the market has changed to a rental model.

Independent living is characterized by a normal rental apartment averaging 1,000 square feet with a full kitchen. In addition, a resident is entitled to two meals a day, housekeeping and the use of all amenities and programs the project has to offer.

Assisted living encompasses a higher level of care along with smaller units averaging 700 square feet and a kitchen without a dishwasher or stove. The resident is offered three meals per day, housekeeping and the use of all facility amenities. The assisted living residents have a separate dining room.

Memory Care units are 450 square feet and are like hotels rooms with no kitchens. The residents receive a very high level of care as they have been diagnosed with some stage of dementia.
There is a substantial shortage in most U.S. markets today of large Class A rental and CCRC product. Existing facilities, built on average over 20 years ago, do not fit today's sophisticated senior generation in terms of location, style or amenities. Today, there are only 1,970 CCRC projects in the U.S. with a majority of those as entrance fee models.
Seniors (defined as those 75 years and older) in need of services drive demand for senior housing and care properties. In the US, there are 20 million people over 75 years of age, a number that will grow quickly as the Baby Boomers enter this demographic group.
Market Imbalance
The combined effect of lack of supply and demand growth proved itself during the 2008-2009 real estate down-turn when senior housing projects out-performed every other commercial real estate property type as measured by NCREIF Property Index.
Operating Partners
Partnering with an experienced senior housing operator is crucial to a project's success. To date we have entered into operating agreements with Des Moines, Iowa-based Life Care Services, the nation's fourth largest operator with 23,000 units under management, and Louisville, Kentucky- based Atria Senior Living, the nation's fifth largest operator, with 20,000 units under management. We will continue to explore other operators to ensure best-in-class teams for each location and the mix of product we take to market.