Rising costs hit Eagle senior care center
Castle Peak Senior Care
• Construction — $16.8 million
• Land — $988,000
• Architecture, Engineering, Entitlements — $2.7 million
• Furnishings, Fixtures and Equipment — $1.4 million
• Resident Experience/Excellence in Care — $350,000
• Marketing, Fund-raising and Pre-opening — $685,000
• Financing Costs — $542,000
• Reserves — $1.6 million
• Total — $24.9 million
• USDA Direct Loan — $12.5 million
• Eagle County Debt — $5 million
• Eagle County Land Donation — $988,000
• Augustana Care Debt — $1.7 million
• Capital Campaign — $4.4 million
• Supplemental Capital Campaign — $350,000
• Total — $24.9 million
EAGLE — The Castle Peak Senior Care Center is rising out of the ground, and so are the construction costs associated with building it.
Ground-breaking ceremonies were celebrated July 16 for the Castle Peak Senior Care Community — a 64-bed skilled nursing and assisted living senior care facility located on a 5-acre site owned by Eagle County, immediately north of Brush Creek Elementary School in the Eagle Ranch neighborhood. The project plan includes 22 skilled nursing beds, 20 assisted living apartments, 12 memory care beds and 10 transitional care units. Augustana Care, a Minnesota-based nonprofit organization that owns and manages 23 senior care projects, is partnering with Eagle County to build the project. Once the facility is open — which is slated to happen in 2016 — Augustana will be the care center manager.
But just two and a half months after Weitz Co. of Denver launched construction, the building footprint has condensed and the costs have risen.
In a letter to the town of Eagle, Lisa Pease, Augustana Care director of development for Colorado, reported that the project has encountered widespread rising increases in construction costs.
“As you are aware, Eagle County has seen these costs rise as much as 25 percent in the past year,” Pease said.
The case isn’t quite that grim for the Castle Peak Senior Care project, but Pease noted costs have increased around 11 percent.
She reported through project redesign, Augustana was able to reduce the overall square footage of the facility from 62,000 square feet to 59,000 square feet to absorb some of the cost increase. But more has to be done to fund the overall increase in costs from the original budget of $22.7 million to the revised budget of $24.9 million.
The USDA Rural Development Loan program has agreed to provide an additional $500,000 in financing. Eagle County will loan an additional $645,000 and Augustana Care will provide an additional $700,000.
“This has left a remaining funding need of $350,000 to be raised from community sources,” said Pease.
Pease detailed the funding shortfall as follows:
• $200,000 — Furnishings, fixtures and equipment including a handicap accessible bus, fitness room equipment, outdoor patio furniture and common area furnishings.
• $100,000 — Weather protection canopy for the entrance to the assisted living area.
• $50,000 — Workforce development training for staff who are new to senior care.
“We knew prices would be going up and to be able to close on the construction financing, we made additional contributions because we recognize the need for this project for our senior population,” said Jill Klosterman, Eagle County housing director.
In addition to its land donation, which is valued at $988,000, Eagle County is making a $5 million subordinate loan to help finance the Castle Peak Senior Care Center. The money comes from a refinancing of the Lake Creek Village apartments project and will be paid back after the main USDA loan is repaid.
Klosterman said downsizing the building from 62,000 square feet to 59,000 square feet will not affect programing. She said the new plan reduces the length of the hallway between the assisted living and skilled nursing parts of the facility and downsizes and relocates offices.
“It really doesn’t cut anything out as far as usable space,” she said.
In terms of the $350,000 capital campaign now underway, Klosterman noted the money for the primary building construction is there. The additional money will provide important functional services, she said.
To make up the $350,000 shortfall, Augustana is again approaching individuals and municipalities in Eagle County for contributions.
“Just this week, the town of Vail has committed to match dollar for dollar, up to a maximum of $50,000 in total, on all new cash commitments/contributions coming from other municipalities and Eagle County to assist the Castle Peak Senior Care Center reach its goal,” Pease said.
We all know Eagle County is short on workforce housing. But a recent report shows there are still barriers to building.