Hubbell looks to seniors
Friday, August 26, 2011 7:00 AM
"I think there is an appetite in the lending community for that type of product."
– Steve Niebuhr, Senior vice president, Hubbell
Hubbell Realty Co. has remained nimble during the tight real estate market.
The company is dabbling in the construction of senior living communities while it studies the potential of that market niche in its larger mixed-use developments.
For the time being, Hubbell is the construction manager for Fort Des Moines Senior Living, a three-story apartment building with 54 one-bedroom and six two-bedroom units for low-income seniors that is being developed by Tom Akers.
The building will feature a theater, a library, a common casual dining area, an activity room and various meeting areas. Each floor has laundry facilities and private meeting spaces. The project should be finished next year.
Hubbell’s own Cottages at Johnston Commons should be completed later this year. Like Fort Des Moines Senior Living, it is being built with the assistance of tax credits, which provide gap financing for the developer and a tax break for private equity investors who purchase the credits.
The complex’s 29 two-bedroom and two one-bedroom townhouses will feature attached garages and, according to a market study for the Iowa Finance Authority, which approved the tax credits, provide an upgraded living environment from much of the existing housing for low-income seniors in northern Polk County.
The study said the units should be more than 90 percent occupied within a few months of completion, filling a need that exists for low-income seniors age 55 and older.
By 2012, there will be 927 age- and income-eligible people for the 31 units, according to the study.
The study went on to point out that in northern Polk County, the senior population age 55 and older increased 36.5 percent between 2000 and 2008 and was expected to increase another 10.7 percent by 2014.
Hubbell is considering whether to add market-rate senior living communities to its product mix, and for those developments, it is following the progress of Ewing Development & Land Services LLC and other developers.
“The demographics are moving that way. It is an area that is underserved,” said Steve Niebuhr, a senior vice president at Hubbell.
He noted that the high-end market is being served by other projects, but there is a need to serve moderate-income seniors.
Hubbell is studying Ewing and others “to understand the market and learn what’s going on,” Niebuhr said.
The projects offer good construction pricing because they are largely based on tried-and-true construction methods used in multifamily, apartment-style projects.
“I think there is an appetite in the lending community for that type of product,” Niebuhr said.
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