Redstone Village has successfully expanded its market position where others have faltered.
Sponsor: Redstone Military Residence Association
Independent Living Phase I: 88
Independent Living Cottages Phase I: 16
Assisted Living Phase I: 50
Skilled Nursing Phase I: 40
Independent Living Phase II: 3
Independent Living Cottage Phase II: 5
Assisted Living Phase II: 10
Memory Support Phase III: 32
Opening Date Phase I: 2004
Opening Date Phase II: 2008
Opening Date Phase III: 2009
Opening Date Phase IV: 2013
Opening Date Phase V: 2013
By phasing its development strategy, Redstone Village has successfully expanded its market position where others have faltered.
Redstone Village in Huntsville, Alabama, is a perfect example of how successful a community can be when using a phased approach to development. The Redstone Village board of directors worked with Greystone Communities to mitigate market risk by downsizing the scope of the initial first phase to just 88 independent living apartments. This decision was driven by a desire to increase speed to market, as well as to respond to market dynamics — including a new competitor that was going to open before Redstone Village.
Why a Phased Development Approach?
This approach has served Redstone Village well by mitigating risk during the development and allowing Redstone to be proactive in responding to market demand. Further, each expansion has brought with it enhanced economies of scale.
Redstone Village was marketed and opened approximately six months after Huntsville’s first life care community opened to area seniors. That competitor has suffered in the market due to extensive value engineering and the brief withdrawal of Medicare certification. As a result, the competitor filed for reorganization protection under Chapter 11 in August of 2006. Despite the challenges faced by its primary competitor, Redstone Village continued to expand the continuum of care and provide additional resident amenities through two phased expansions.
Description of the Project
Construction of Redstone Village began in January 2003 and opened for occupancy November 2004, after initial construction delays due to city permitting delays and unanticipated construction-related requirements imposed by the municipality. The assisted living apartments and health center beds became available in April and May 2005, respectively.
To expand the continuum of care and to respond to the demonstrated market demand, Redstone Village expanded its available assisted living units by opening another 10 in August 2008.
In 2009, they added 32 memory support assisted living units, achieving 100% occupancy within 13 months.
Challenges and Results
This “start-small” approach is not without its challenges. Fewer units means tighter cost controls and unwavering focus on the bottom line. This must be balanced against the hospitality focus expected by residents and quality care consistent with the mission and values of the organization. Redstone Village has worked closely with Greystone on both the development and management of the community to ensure these competing dynamics are appropriately considered and addressed.
Keys to Success
Redstone Village is led by a forward-thinking board and management team with a commitment to providing quality services. A carefully managed development process and well-timed expansions have positioned Redstone Village for continued success and the ability to be opportunistic in its efforts to develop future phases, all driven to address market demand and in support and furtherance of the organization’s mission and vision.
Not willing to rest on its laurels, Redstone is in the process of planning its fourth phase. This new phase will bring the community around full circle by adding a third wing of independent living apartments. These are the same units that were removed from the first phase back in 2003. Redstone is poised to take advantage of its reputation and the lack of development by its local competition. The addition of this new phase will also bring a new aquatics and fitness center to the community.