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Paying in gold for the golden years

High-end retirement villages are a growth industry. They offer sumptuous services and a built-in social life. Fees can top $1 million.

June 12, 2008|Maria L. La Ganga | Times Staff Writer

SANTA ROSA, CALIF. — 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.

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