At 828id, our mission is to create a meaningful impact on senior living communities by providing exceptional design solutions. We firmly believe that the environments in which seniors reside play a crucial role in their overall well-being and happiness. Just like in our successful senior living community renovations, we understand that the proper allocation and utilization of CapEx funds are essential for the continued growth and enhancement of these communities. Our Founder and CEO, Keri Moore-Muñiz, is passionate about discussing how strategic CapEx investments can significantly influence design decisions, ultimately shaping the experiences of residents and their families. Join us as we delve into the world of CapEx funds and explore how thoughtful design choices can transform senior living communities into comfortable, stylish, and functional spaces that residents can truly call home:
Q: Why is it important to allocate CapEx Dollars to refresh design and/or procurement?
A: It is crucial to allocate a portion of your annual CapEx budget towards furniture and interior refreshments. When welcoming new residents or fulfilling promises to existing ones, ensuring updated and renovated spaces is a top priority. Resident fees cover various expenses, including unforeseen ones such as purchasing new chillers or replacing large HVAC units, which can significantly consume CapEx funds each year. This constant challenge makes it difficult for Executive Directors, operators, and owners to maintain a balance.
While they do allocate funds for these expenses, often, they need to readjust their budget to accommodate unexpected costs. To address this issue, it’s beneficial to slightly overestimate and add a cushion to the numbers in the budget. By doing so, you can avoid these unexpected expenses gobbling up the entire budget. This allows for additional spending on essential items such as artwork, pillows, accessories, and key furniture pieces, demonstrating a commitment to progress and wise financial management to the residents.
Showing that you are actively using their money wisely is crucial for resident satisfaction. Being able to make small improvements regularly gives residents confidence that their concerns are being addressed and progress is being made. By reserving a portion of the funding specifically for showing progress, you can keep the residents informed about ongoing improvements and give them a sense of reassurance that their expectations are being met. It is essential to maintain this approach to build trust and ensure a positive living experience for the residents.
Q: How does 828id help owners/operators evaluate how to spend their CapEx money?
A: CapEx management has evolved into a unique hybrid approach, especially in the last two years as the result of Covid. In traditional projects, we have a project manager, an architect, and construction managers. A lot of times we’ve been very creative in what our fees and services are because it’s more of an interior project.
In cases where the project primarily involves interior elements like carpet and paint, we question the necessity of hiring an architect. Similarly, for straightforward MEP (Mechanical, Electrical, and Plumbing) replacements and fixtures, we consider whether it’s essential to bring in additional consultants.
Our expertise in CapEx projects comes into play when we take the lead in decision-making. We take charge in selecting the right carpets and making informed choices regarding lighting options, relying on our trusted reps to provide excellent service. This way, we ensure that our clients receive the best service possible. We look for new ways to help bring in resources that could help find local installers so our clients can spend money elsewhere to give more improvement than to hire consulting and management companies.
Q: How does 828id manage the design process for CapEx projects?
A: In many cases, CapEx budgets are generated without a thorough evaluation of actual needs. Sometimes, we receive budgets from Executive Directors, operators, or third-party operators and question their allocations. For example, they might set aside funds for updating dining chairs when, in reality, the worn-out and tired lounge chairs require immediate replacement. While dining chairs might still have some life left in them, allocating funds to lounge chairs would yield a better return on investment.
Our approach involves conducting on-site evaluations and assessments. It’s like putting on a fresh set of glasses and gaining a new perspective. We also make sure to view the site from a marketing standpoint, recognizing that first impressions are crucial to maintaining high occupancy rates. Therefore, we prioritize areas that potential residents or their families focus on during the decision-making process, like the model unit or the front lobby, aiming to create a warm and inviting atmosphere that reassures them their loved ones will be well taken care of.
It’s essential to address needs pragmatically, especially in spaces like the dining room, which often receives less scrutiny compared to the more visually impactful areas. By shifting funds strategically and making cost-effective decisions, we aim to get the most value out of each dollar spent. Our ultimate goal is to maximize the impact of the budget, ensuring it stretches as far as possible while keeping occupancy rates high. This approach ensures that residents and their families feel confident in choosing the community, knowing that we prioritize their comfort and well-being.
At 828id we understand the importance of every dollar spent, we strive to make decisions that yield the most substantial benefits and contribute to the overall well-being and satisfaction of the residents and their families. If you’re looking to renovate your senior living community, contact 828id.
