Over the next 15 years 11,000-14,000 people per day will reach retirement age.

The American population is rapidly aging. As a result, healthcare spending will grow by 8.3% by 2014 and more than 3.2 million new jobs in healthcare will be created between now and 2018, according to the Bureau of Labor Statistics. In 2011, the first baby boomers turned 65, and over the next fifteen years, between 11,000 and 14,000 people a day (or between 60 and 80 million people total) will reach retirement age. Additionally, the population of individuals 85 and older has increased dramatically as well. This population grew an estimated three times the national rate through 2010 due to advances in medical care and increasing longevity. The following chart from IBISWorld shows the annual change in the number of adults over 65 years old, including projected levels through 2019.[1]   
[1] IBISWorld. “Number of adults over 65 years old in the US – Business Environment Report.” May 2014. Source: http://www.ibisworld.com

By 2020, national healthcare spending will reach $4.6 trillion and account for 19.8% of the GDP. Government-sponsored health spending will increase 50% by 2020, largely due to an expected robust Medicare enrollment growth, coverage expansions, and Exchange plan premiums and cost-sharing subsidies. Medicare paid for 20% of all health expenditures in 2010.[2]
[2] Centers for Medicare and Medicaid Services.  “National Health Expenditure Projections 2010-2020”  Obtained at: https://www.cms.gov/NationalHealthExpendData/downloads/proj2010.pdf

For the next two decades, 10,000 people will turn 65 each day.[3 The growing aging population throughout the U.S. will place greater demand on the health care industry. Medical News Today reports that the assisted living industry is seeing a boom due to the increase in Americans’ life expectancy, now over 78 years.[4] All of the Baby Boomers will be 65 or older by 2029, according to the Centers for Disease Control and Prevention, and 65-year-olds live an average of 19 more years.[5] The following chart indicates the United States Census Bureau’s projections for the population growth for individuals 65 and older between 2010 and 2050.
[3] The Silver Book.  Future Demographics.  Obtained at:  http://www.silverbook.org/browse.php?id=57#
[4] Medical News Today. Home Care, Assisted Living Boosted By U.S. Life Expectancy Increase. 2011. Source:  http://tinyurl.com/3z2d3vn
[5] The Silver Book. Future Demographics. Source: http://www.silverbook.org/browse.php?id=57#

The following charts, provided by the United States Congressional Budget Office, display the growing number of elderly adults as a share of the U.S. population, as well as estimated economic value of formal and informal long-term support and services for elderly people in the United States.[6]
[6] Congressional Budget Office. “Rising Demand for Long-Term Services and Supports for Elderly People.” June 2013. Source: http://www.cbo.gov/sites/default/files/cbofiles/attachments/44363-LTC.pdf

All of this, combined with the constantly progressing state of the art in the medicine of eldercare, is creating a huge demand for residential facilities that is not currently being met in southern Oregon.

Elder Care Development LLC has received approval through the State of Oregon for two projects. The Company’s initial location at 800 N. Haskell Street in Central Point, Oregon, (Jackson County) places it in an underserved area near a 100 unit independent living apartment complex and adjacent to a new 300-unit apartment building being constructed just south of the property. Also located in the community is an existing, 112 room independent living facility. These independent living facilities are not equipped for the advanced needs of assisted living and memory care, so they currently refer residents to assisted living and memory care facilities out of the area. Once the Company’s facilities become operational, they will likely receive these references from local, independent living communities. Elder Care Development LLC has received State approval for a second location in Grants Pass, Oregon, (Josephine County). The Company’s chosen locations will maximize its ability to tap into a steady population of aging adults who will require assisted living or memory care. The following tables provide the most current U.S. Census data with regard to the population growth of Jackson and Josephine Counties.

[7] U.S. Census Bureau. Source: http://www.census.gov/
[8] U.S. Census Bureau. Source: http://www.census.gov/

The following table provides pertinent figures for the population surrounding 800 N. Haskell Street in Central Point, Oregon. This data includes the Twin Creeks Retirement community, as well as adjacent neighborhoods, and is provided by ESRI, a market research firm.[9]

[9] Business Analyst Online. Source:  http://bao.esri.com/

The following table provides pertinent figures for the population surrounding Grants Pass, Oregon. This data is provided by ESRI, a market research firm. [10]

[10] Business Analyst Online. Source: http://bao.esri.com

Market Segmentation

Elder Care Development LLC strives to build facilities featuring state-of-the-art technology and amenities that offer residents the comforts of home while providing a safe and secure environment. Elder Care Development's tenants will target individual’s ages 55 and older who require either memory care or assisted living, and will also market specifically to adult children (typically between the ages of 30 and 50) who are now faced with caring for their aging Baby Boomer parents. This phenomenon is known as the “Sandwich Generation.” According to the Pew Research Center, “Nearly half (47%) of adults in their 40s and 50s have a parent age 65 or older and are either raising a young child or financially supporting a grown child (age 18 or older)… about one-in-seven middle-aged adults (15%) is providing financial support to both an aging parent and a child.” [11]

Nearly 16% of the population surrounding Elder Care Development LLC's initial location is age 65 or older, and a full 21% of individuals living in the Grants Pass area are over age 65. In addition, the Company recognizes that many elderly individuals choose to relocate during their retirement years to be closer to their adult children, and will therefore cater to elderly individuals who do not yet live in the area but have relatives who do. Approximately 25% of the population surrounding the Central Point location, as well as 23% of the population surrounding Grants Pass, falls within the “Sandwich Generation” age group

Market Needs

According to the U.S. Congressional Budget Office, “By 2050, one-fifth of the total U.S. population will be elderly (that is, 65 or older), up from 12 percent in 2000 and 8 percent in 1950. The number of people age 85 or older will grow the fastest over the next few decades, constituting 4 percent of the population by 2050, or 10 times its share in 1950. That growth in the elderly population will bring a corresponding surge in the number of elderly people with functional and cognitive limitations. Functional limitations are physical problems that limit a person’s ability to perform routine daily activities, such as eating, bathing, dressing, paying bills, and preparing meals. Cognitive limitations are losses in mental acuity that may also restrict a person’s ability to perform such activities. On average, about one-third of people age 65 or older report functional limitations of one kind or another; and among people age 85 or older, about two-thirds report functional limitations. One study estimates that more than two-thirds of 65-year-olds will need assistance to deal with a loss in functioning at some point during their remaining years of life. If those rates of prevalence continue, the number of elderly people with functional or cognitive limitations, and thus the need for assistance, will increase sharply in coming decades.” [12] The Company’s new and amenity-rich facilities will meet these growing needs while providing peace of mind for both residents and their loved ones.

[11] Pew Social Trends. “The Sandwich Generation.” January 30, 2013. Source: http://tinyurl.com/om7m8nw 
[12] Congressional Budget Office. “Rising Demand for Long-Term Services and Supports for Elderly People.” June 2013. Source: http://www.cbo.gov/sites/default/files/cbofiles/attachments/44363-LTC.pdf

Industry Analysis

The $60.2 billion Retirement Communities industry includes businesses that provide “residential and personal care services for the elderly and other individuals who are unable to fully care for themselves or who desire to live in a community facility.”[13]Market research firm IBISWorld projects nearly 5% annual growth for this industry over the next five years as the number of adult’s ages 65 and older continues to grow. IBISWorld reports, “An aging population and growing need for dementia care (care provided to those with memory impairment) are stimulating much of the industry’s growth. Retirement communities provide a number of services to assist seniors who suffer from chronic illnesses or with activities of daily living. In the past five years, the number of assisted living facilities that provide dementia care has risen as a proportion of total facilities.”[14]
The following charts provided by IBISWorld, present an overview of the Retirement Communities industry in the United States.[15]

[13] IBISWorld. “Retirement Communities in the United States.” July 2014. Source:  http://www.ibisworld.com
[14] Ibid.
[15] Ibid.