Paying in gold for the golden years
It is move-in day at Varenna at Fountaingrove, and Tess Manion looks up from a stack of paperwork with a glint in her eye. “Have you seen the wine cave?” she asks in a thick New England accent, before admitting that, not being from California, she’s more partial to Scotch than sauvignon blanc.
But that’s OK. Because Manion, 80, and her new-neighbor-turned-fast-friend Evelyn Radunich (an octogenarian who likes vodka tonics) can go to the bar instead. Or they can sip cocktails from their own broad balconies overlooking graceful grounds planted in zinfandel.
Manion and her new pal are not your average retirees, and Varenna is far from your average retirement community. The Mediterranean-themed complex collects an entrance fee of up to $1.3 million, along with monthly charges that can peak at nearly $5,500, depending on the unit.
Varenna, which opened its doors in mid-May, is the latest in a new breed of luxury retirement villages, putting the gold in some Americans’ golden years and providing at least one bright spot in an otherwise bleak real estate picture.
The women’s neighbors include a one-time teacher from Arizona with two sons. One son is a former television anchorman; the other is a high-tech entrepreneur who sold his company to a telecom giant and is paying her way. And then there’s the widow of a California congressman-turned-federal judge.
For a fee, these affluent elders can have dogs walked and cars detailed, new apartments decorated and boxes unpacked. They can get a daily wake-up call and store their wine collections in climate-controlled comfort.
They can shop for groceries in a chauffeured Cadillac. Views are expansive, ceilings high and apartments spacious -- the biggest, nearly 3,000 square feet, with a gourmet kitchen, two master suites, an office and a den.
“For someone coming from 5,000 to 8,000 square feet, this is downsizing,” said Allison Cervantez, Varenna’s vice president of marketing. “They’ll pay the extra to keep the dining set they’ve had for 50 years, or their grandmother’s armoire.”
This is late-life living large, and it raises at least one serious question: If you can afford to live in Varenna, or Classic Residence by Hyatt in Palo Alto, or Peachtree Hills Place in Atlanta, or Fox Hill in Bethesda, Md., or the Clare at Water Tower in Chicago, you can afford to stay in your own home forever. So why move?
“The very affluent have always had the most choices and really had the easiest time saying ‘I’m going to stay right where I am,’ ” said David Schless, president of the American Seniors Housing Assn.
But “one of the driving forces behind people moving into senior housing -- even people with a lot of resources -- is that, while you can get meals delivered, home healthcare, a visiting nurse,” he said, “people 80, 85 and up can be prisoners in their own homes.”
Sociability aside, there’s another big characteristic the new residents of Varenna and similar properties have in common. Most of these complexes are what California state law describes as “continuing care retirement communities.” And most people who move into the communities, experts say, are “planners.”
Although there is some variation, this is how a continuing care retirement community works: New residents pay an entrance fee -- all cash, not a penny financed -- and then pay monthly fees for a certain number of meals and activities in independent-living units. At Varenna, for example, the cost of admission ranges from $345,000 to $1.3 million, and monthly fees range from $2,724 to $5,485.
When they are no longer able to perform the basic tasks of daily life, like bathing, dressing and taking medication, they receive extra help in their own apartments or get a priority spot in an assisted-living wing in the same complex.
Many continuing care retirement communities have “memory-care” facilities for residents with Alzheimer’s or other types of dementia.
Depending on the community, they may receive the stepped-up care for virtually the same monthly fee they paid originally.
If they die or choose to leave the community, they get a large portion of the entrance fee back or it goes to their estate.
That’s how it works at Classic Residence by Hyatt in Palo Alto -- described by many senior housing experts as among the ritziest retirement communities in the country and the first in the current wave of super high-end senior complexes.
Classic Residence by Hyatt began building upscale senior housing in 1987. The company now has 21 properties in 11 states.
The Craftsman-styled Palo Alto complex -- the jewel in the chain -- opened in 2005 across the street from the Stanford Shopping Center (with anchor stores like Neiman Marcus) and a short walk from the storied campus.
The seven biggest units are 4,212 square feet, with three bedrooms, 3 1/2 baths and a den.
The cost of admission to one of those apartments is nearly $4.2 million for a couple, and monthly fees can top $9,000.
There are memoir-writing classes, trips to the San Francisco Symphony and a residents’ lecture committee that has brought luminaries like former Secretary of Defense William Perry to discuss “the possible split of Iraq and the split of Yugoslavia.”
It wasn’t all that hard to persuade Perry to come talk in May. He teaches at Stanford’s Center for International Security and Cooperation. And he lives at Classic Residence by Hyatt.
In fact, about 80% of the community’s residents have a strong Stanford tie. The complex’s library devotes two shelves to books penned by residents, a section heavy on heavy reading, like “Angiography,” by Herbert L. Abrams, emeritus professor of radiology.
Alumni live there, and so does the outgoing president of the board of trustees, venture capitalist Burt McMurtry, who with his wife, Deedee, has donated more than $30 million to Stanford and two years ago pledged $32 million to Rice University.
There are three separate dining venues, including the Bistro, with its wood-burning pizza oven, where light breakfast and lunches are served, and the elegant Colonnade, with wine list and corkage fee. A private dining room is available for parties, and there’s a wine-tasting room.
The chefs are all trained at the Culinary Institute of America.
One recent morning, a group of sprightly, gray-haired women was busy hanging a show of residents’ watercolor paintings in the complex’s sunny art studio. White-haired men read the Wall Street Journal and tapped away at flat-screen computers in the library.
Herbert Ratet, a retired interior designer, strolled across the high-ceilinged great room with its baby grand piano. “You go out in style here,” the 87-year-old said.
Despite fees that rival nearly any complex in the country, the waiting list is 225 prospective residents long. All but one of Hyatt’s continuing care retirement communities is completely occupied, said Randal J. Richardson, company president, and that one’s in Florida, “the worst housing market in the country.”
Those who follow the senior housing market believe that California is underserved, particularly in the highest end. Which is why the company has just expanded its La Jolla property, Richardson said, and why “I fully expect to announce a couple of more opportunities [in the state] before the end of the year.” Although Schless estimates luxury retirement at no more than 4% or 5% of the senior housing market, a wave of new properties is in the works around the country.
The Los Angeles area is particularly underserved, according to Richardson and Molly Forrest, chief executive of the Los Angeles Jewish Home. Forrest’s organization is developing a 108-unit continuing care retirement community in Reseda called Fountainview at Eisenberg Village, which was more than 90% sold before it broke ground in December.
The New Urbanist-style complex has a fitness and wellness center, fine dining venues, complete with wine list and movie theater, and entrance fees ranging from $350,000 to $809,000 -- the price of admission eased somewhat because the Jewish Home bought the land 35 years ago.
Forrest attributes the dearth of such accommodations to complex regional factors, including “the lack of societal planning for an aging population, the high cost of land [and] zoning limitations.”
Fox Hill, which is scheduled to open in Bethesda, Md., in December, has a 200-seat performing arts center, a recording studio and indoor driving range. Condominiums in the 240-unit complex cost up to $1.8 million, and monthly service fees peak at $4,200. With 41 penthouses, the Amsterdam at Harborside in Port Washington, N.Y., has entrance fees that top out at nearly $2.1 million, and monthly service fees can be up to $7,520. It is scheduled to open in the spring of 2010 and is already 90% sold.
Peachtree Hills Place takes up 23 acres in Atlanta’s Buckhead district and offers residents an on-site concierge medical practice, a greenhouse and outdoor raised gardening plots. Top entrance fees are $1.4 million, and monthly fees can be as much as $6,765. The community is scheduled to open in about two years.
Redmond, Wash.-based Aegis Living, which just opened Varenna, hopes to break ground next year on a similarly high-end community in the same Santa Rosa neighborhood, this one for older gays and lesbians, said Dwayne Clark, the company’s chairman.
And an “east-meets-west, health-themed” complex is in the works in Redmond, he said. Naturopathic doctors and physicians from the University of Washington will live on site, and residents will dine from the facility’s own organic gardens.
Clark describes his clients as someone who “ ‘just sold a $2-million house, I have a pension of $60,000 a year, and I want to retire well, have a martini at 6, go out on the rowboat, not have any worries. I want to live well.’ ”
Tess Manion and her daughter, Lynne Hurst, are doing a final walk-through of apartment 325 before bringing up boxes of specially purchased towels for the kitchen and bath.
Jaunty in black-and-white seersucker Bermudas and freshly polished hot pink nails, Manion waves her hand at the foyer and muses. The tapestry from Venice goes there. There’s a mahogany four-poster and chest for her room. Maybe she’ll buy a piano for that corner over there.
The move-in staff has left a welcome basket with toiletries and wine in the kitchen. A charcuterie tray arrives for an afternoon snack. There’s a “Varenna”-embossed robe in the walk-in closet.
“We keep telling people it’s like a Ritz-Carlton for old people,” Hurst says. “My daughter says it’s a cruise ship without the water.”
And it is perfect, except for one thing. Manion’s husband isn’t here to celebrate with her. He died two years ago from Parkinson’s disease after making sure his wife would have a home at Varenna. It had just broken ground.
“I have two kids who are good to me,” Manion says. “I can afford to be here. But he isn’t here.”
A pause. Damp eyes. A resolute smile.
“But I’m here. And I’m happy to be here.”
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