427 Rental Units for Active-Adult Retirement Market
As seen in The New York Times:
A developer known for rental properties has broadened his offerings in the active-adult retirement market with a 427-apartment development that will differ from most such communities by allowing residents to lease, rather than purchase, their apartments. The development, Woodbridge Hills, will offer people 55 and over housing as well as social and recreational activities.
Woodbridge Hills is to be made up of 14 low-rise buildings with 23 to 32 apartments each spread over 21.7 acres just off the intersection of Green Street and Route 1. It will also have a 5,000-square-foot clubhouse with, among other things, an exercise room, a business center, an outdoor swimming pool and walking trails, according to Mark Fisch, president of Continental Properties of Woodbridge. It is developing the $45 million project using its own money and bank financing over the next three years.
New Jersey, especially Ocean County, has long been a hub for active-adult residences. But they have usually been built as condominium apartments and town houses or as single-family detached homes for residents to buy, not rent.
While new rental projects for those 62 and over are being built in the state, they generally do not offer such social and recreational amenities as clubhouses, which are common in active-adult developments, as well as in apartment complexes without age restrictions. Many rental apartment projects for older people are also restricted to those with low and moderate incomes.
Continental Properties has fused the rental and the active-adult ideas in Woodbridge Hills, which Howard S. Rappaport, a company vice president, described as a hybrid. ''It will provide an alternative housing option and fill an underserved niche in the active-adult market,'' Mr. Rappaport said. ''What we will be selling here is lifestyle.''
Continental owns or manages more than 10,000 rental units in the state. It has also recently been involved with building active-adult, for-sale, single-family-home communities and has five such projects under way or planned in the state, totaling 973 units.
With the graying of New Jersey, and the nation, demographics continue to fuel the demand for all kinds of housing for older people, including active-adult residences. Of the state's estimated population of 8.1 million last year, 22.5 percent, or 1.83 million, were 55 or over, according to the latest census figures. That number, up from 1.7 million in 1990, is expected to grow to 2.23 million in 2010.
In Middlesex County, 21.5 percent of the 717,949 residents are 55 and over, and in Woodbridge, 20 percent of 97,000 residents are.
While the production of active-adult housing for sale continues at a brisk pace, there are several reasons why a rental alternative has been slow to catch on, industry professionals said. Among them is the difficulty of finding sites that local communities are likely to approve for rentals. Sites also must be able to accommodate a high enough density for such projects to make economic sense given their requisite recreational components, said James Robbins, who heads a housing consulting concern bearing his name in Fairfield.
William Becker, a consultant in Teaneck who specializes in active-adult housing, added that despite the hurdles there was a market for such rentals. There are, he said, ''people who don't want to pay the average $150,000 it costs today to buy a home in a for-sale active-adult community,'' or ''don't want to be tied to the house with a mortgage.''
Mr. Becker said a rental alternative would be particularly appealing to single professionals, people who have lost a spouse and those who live in another part of the country for part of the year.
Agreeing with that assessment is Nathan Slovin, executive vice president of New Jersey Apartment Association, a trade group in East Brunswick. The idea of active-adult rentals, Mr. Slovin said, is sound because such projects will offer people the flexibility now enjoyed in developments with no age restrictions. ''Not everyone in their retirement or preretirement years wants to buy or is ready to relocate to Arizona or Florida,'' he said.
That the state's overall rental market is strong is also on the side of such a trend. According to the apartment association, the rental vacancy rate dropped by one to two percentage points in the last year to less than 5 percent in north Jersey, excluding urban centers like Newark. The rate is slightly higher in central New Jersey and under 10 percent in South Jersey
IN turn, developers continue to build. Some 7,500 new rental apartments are on the market or will come onto the market in six months, Mr. Slovin said. With active-adult rentals, he said, Continental has found ''a different approach to and niche within the industry.''
Other developers may follow. Mr. Becker said that builders of the 6,000 active-adult residences under construction or planned in the state had indicated that as many as 1,000 units potentially could become rentals.
Continental Properties got involved two and a half years ago with Woodbridge Hills. Though the project is the company's first development in Woodbridge, it has built rental apartment properties in nearby Edison, Mr. Rappaport said, adding, ''We know the area so we pursued the seller of the land.''
The seller, Elizabethtown Gas, was winding down its maintenance, distribution and trucking operations on the site, which Continental agreed to buy in 1997. Mr. Rappaport said the property ''lends itself more to a rental than a for-sale project'' because at 21.7 acres it is too small to accommodate the number of single-family homes necessary for his company's more traditional active-adult projects to work. In addition, it is off Route 1 and not far from both the Woodbridge Center Mall and the Menlo Park Mall, he added.
The company took title to the property in September. It spent the intervening years getting the site rezoned from commercial to residential use and securing the needed state and local approvals.
Woodbridge Hills is supported by the community. It is, James E. McGreevey, the mayor of Woodbridge, said, ''a thoughtful project, which largely responds to the need for increased market-rate senior housing in Woodbridge and Middlesex County.'' He pointed out that there was a two-year waiting list for the income-restricted rental housing run by the Woodbridge Housing Authority.
The project, he added, will offer ''an attractive opportunity to help seniors remain in Woodbridge in a more manageable and affordable way'' than living in large single-family detached homes and without making, ''a complicated investment in real estate.'' At the same time, Mr. McGreevey said, the project ''will not have a deleterious impact'' on municipal services like schools or local roads.
The 427 apartments at Woodbridge Hills, designed by Roth Architects of Voorhees, will be in three-story, stone and wood-sided elevator buildings. All the one- and two-bedroom units, with 800 to 1,100 square feet, will be equipped with washers and dryers and wired for advanced telecommunications, including high-speed Internet access. Those on the ground floor will have patios, while upper-level units will have balconies.
The project is expected to attract residents mainly between 55 and 62 and from Woodbridge and Middlesex County, Mr. Rappaport said, adding, however, that it will also draw people from across the Verrazano-Narrows Bridge in Staten Island.
Monthly rents are expected to be $950 to $1,100, which will be competitive to rentals not restricted by age in the area, he said. He added that the rents would include the use of the project's recreational amenities, which will be built at the same time as the housing. Initial occupancy will begin by late next spring.
Mr. Robbins, the consultant, said that, while the project's amenities were not grand, the project still ''will serve as a litmus test'' of what people will be willing to pay in rent for an active-adult style of living.
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