As the population of America rises, the demand for long term care facilities continues to rise, making building a nursing home or assisted living facility a rather solid investment. In fact, one can expect annual returns of 10% or more if they take the proper steps for opening a nursing home.
The first major question an investor must ask before building a nursing home or assisted living facility is: how much will it cost? This can vary depending on a number of factors, such as the size and location of the facility, the type of construction, and the amenities that are included.
The Impact of Location on the Cost of Building a Nursing Home
Building a nursing home in a rural area is typically cheaper than building one in an urban area and building a nursing home in a state with lower labor costs will keep construction costs down as well.
For example, if you are considering building a nursing home in San Francisco, the construction costs are between $280 to $725 per square foot. As for the labor costs, PayScale notes that you can expect to pay the average construction worker $25.54 per hour. Meanwhile, the construction costs in Cheyenne, Wyoming, are $100 to $220 per square foot and the average worker will expect $18 per hour, according to ZipRecruiter.
Building Size and Its Impact on Cost
A smaller building will obviously cost less to construct than a larger building, but it is important to keep in mind that the cost per square foot can increase as the size of the building decreases. Also, there are certain minimum sizes that must be met in order for a commercial building to be considered functional. For instance, a nursing home must have a certain number of beds in order to be licensed, meaning it must be a certain size to provide adequate living space for residents.
The Impact of Material on Nursing Home Building Costs
Naturally, higher-quality materials, such as reinforced concrete, which is designed to last, are more expensive than lower-quality materials like wood or stone. In addition, though, the type of materials you use can impact the time it takes to complete the construction project. A construction project using higher-quality material will take longer to complete than one that uses wood, for instance.
But while it may be tempting to use lower-quality materials, one should carefully consider its consequences. Nursing homes built using high-quality materials—although costly at first—tend to last longer and need less maintenance in the long run. Not to mention, the nursing home is likely to attract residents on account of its more appealing appearance.
A building that uses lower-quality materials will require regular maintenance. For example, if one uses wood for construction, termites could pose a threat to their building, making it necessary to conduct regularly checks for invasive insects and to use termite-resistant polish or treat their wood with polystyrene.
RSMeans data provides estimates of what it would cost to build a nursing home using face brick with concrete block back-up or bearing walls:
|Cost Estimate (Union Labor)||% of Total||Cost Per SF||Cost|
|Contractor Fees (GC, Overhead, Profit)||25%||$35.38||$884,400|
|Total Building Cost||$196.33||$4,908,300|
|Cost Estimate (Open Shop)||% of Total||Cost Per SF||Cost|
|Contractor Fees (GC, Overhead, Profit)||25%||$32.56||$814,000|
|Total Building Cost||$180.71||$4,517,700|
Of course, this is just the median cost and there will be nursing homes that cost more or less than this to construct. However, it gives a ballpark figure of what you can expect to pay for a newly-constructed nursing home.
5 Insider Tips To Build a Nursing Home
Once one has secured the funds to build a nursing home, they will need to come up with a strategic plan for building a nursing home if they want it to provide sustainable income for decades to come:
1. Build With the Future of Care in Mind
When building a nursing home, one should not restrict themselves to what they think their current residents need but rather consider the future needs of these residents as well. As residents age, their needs will change, and they may need more assistance with activities of daily living. Hence, one should design the nursing home in a way that will make it easy to make changes to living spaces in the future.
This strategy could include adding wider doorways and hallways or avoiding the use of carpeting in common areas, as it makes using wheelchairs difficult. Another example is that if one plans on providing memory care services in the future, they should try to build a nursing home that has small units. This is because people with dementia or Alzheimer’s disease tend to feel more comfortable in smaller and more intimate surroundings.
By building with the future of care in mind, one can save themselves time and money, as they will not have to make as many changes down the road.
2. Observe All Accessibility Codes
It is essential that one observes all of the relevant accessibility codes when building a nursing home. This is because the nursing home should be accessible to all residents, regardless of their physical abilities.
Some accessibility codes were passed as federal law while others are simply recognized as an international standard. Examples include the Americans with Disabilities Act (ADA), the Fair Housing Act (FHA), and the International Building Code (IBC). Accessibility requirements that must be met when building a nursing home include ramps, grab bars, and wide doorways. In addition, all common areas must be accessible to residents in wheelchairs.
One should note that every state and municipality has different accessibility codes for nursing homes. Thus, it is important to check with the local building department to see what the requirements are before beginning construction.
3. Consider the Life Cycle Cost Analysis (LCCA) When Building
The Life Cycle Cost Analysis (LCCA) is a method for taking into account all of the costs associated with building a nursing home, both in the short-term and long-term. Some of the costs that are included in the LCCA are the initial construction costs, the costs of operating and maintaining the nursing home, and the staff’s salaries.
By considering all of these factors, one can make informed decisions about which materials and construction methods to use. This can help to save money in the long run and reduce the overall environmental impact of building a nursing home.
4. Choose the Best Team
As building a nursing home is such a large investment, it is important to choose a team made of experts in the field of nursing home construction. You will need a qualified architect, building engineer, construction manager, nurse consultant, and lawyer to help with the legal aspects of building a nursing home.
Ideally, one should select a contractor who has experience building nursing homes, as they will be familiar with the codes and regulations that must be followed. In addition, the contractor should be able to provide a list of references for previous projects, so one can assess the quality of their past work.
Each member of the team should have a specific role and be able to offer their own expertise in team meetings. By working together, they can ensure that the nursing home is designed and built to meet all of the needs of the residents.
5. Use Design-build When Building a Nursing Home
Design-build is a delivery method for construction projects that combines the design and construction phases into one. This means that the architect, engineer, and contractor work together as a team from the start of the project.
This saves time and money and also allows for a more collaborative approach to construction. This means that the different disciplines can work together to find the best solutions for the project. In addition, design-build can help to improve communication between the owner and the contractor, as the owner is only dealing with one contractor, rather than multiple contractors.
Contact us here if you would like to explore software options as you look to start a long term care facility.
Design Guides for Building a Retirement Home vs Building a Nursing Home
Before we conclude it is worth noting that the design requirements of building a nursing home are different from those of building a retirement home. A retirement home is an accommodation for elderly adults who require little to no help with ALDs, and have almost no medical requirements. Should there be a medical need, it tends to be minimal. As a result, a retirement home can be designed to stand out to attract residents.
Nursing homes on the other hand are for seniors who require 24-hour care, hence the regulation surrounding nursing home care are extremely strict. In an effort to ensure the best care environment for their residents, there are some design practices that are accepted when building a nursing home.
Although these Nursing home design requirements are not mandated by law, they are accepted as a good practice, as they enhance the living experience of residents in a nursing home.
Pursue a Homelike and Therapeutic Environment
No one wants to feel as if they live in an institution. That’s why it is wise to pursue designs that:
- Make use of natural lights through large windows, skylights, and views of the outdoors
- Use non-reflective materials inside when building a nursing home and use varied colors and textures
- Ensure residents have easy access to safe, outdoor spaces
- Promote privacy, control amongst residents by providing things like privacy curtains in shared rooms
- Ease the disorientation and confusion of residents by providing easy to spot (and read) clocks, calendars, reminders, and to-do notes
- Make residents’ spaces easy to find and identify to encourage their autonomy
- Provide higher lighting levels to prevent dark areas
Promote Efficiency and Cost-effectiveness
If a person wants to build a nursing home that will be lucrative into the future, they will need to design spaces that are easy to use for staff, thus enabling greater worker efficiency. To achieve this, the design should minimize the distance of travel between frequently visited places and include spaces that allow for easy visual supervision of residents by staff.
Enhance Cleanliness and Sanitation
Even before the pandemic, infection control and hygiene were big concerns for nursing homes. To ensure a safe and healthy environment, the designer should:
- Use durable finishes in sanitation spaces
- Create highly effective ventilation systems
- Appropriately locate visible toilet rooms in locations where residents frequently congregate
Prioritize Resident Safety and Security
Earlier, we answered the question: how much does it cost to build a nursing home? There, we noted that the materials used have an impact on the cost of building a nursing home. When it comes to resident safety, one must never cut corners. Rather, one should:
- Use non-reflective and non-slip materials on floors
- Restrict access to hazardous spaces such as the boiler room
- Control access to entry and exit points to prevent residents from wandering
- Limit access to medications and other medical materials, so only authorized long term care staff can gain access.
- Invest in an efficient long term care software that ensures documentation is accurate and timely
Though these design guides are not exhaustive, they are a great starting point in creating an environment that is conducive to healing and rehabilitation of seniors.
Residents’ Needs and Building a Nursing Home
Long term care and the nursing home business can be quite lucrative when done right. However, when building a nursing home, one should always remember whose needs come first: the residents. The design of the nursing home will have a significant impact on the quality of life of the residents. Hence, the building should be designed in a way that considers their needs and enhances their experience.
By carefully considering safety, security, and privacy, you can create a more therapeutic environment that is better for healing and rehabilitation. In addition, by using efficient long term care software, one can improve communication between staff, external providers, resident families, and their residents.
Long term care is all about providing the best care to residents. Individuals and organizations that take this as their priority when building a nursing home are sure to succeed in caring for their residents while also maximizing their profits.