Lasata Heights faced two major challenges this year. Most
significant was the impact additional senior housing options in
the county had on our apartment occupancy. The second factor was
the continued high apartment turnover. Thirty percent (30%) of
our apartments were vacated in 2003. Those tenants that
terminated their residency did so for the following reasons:
- 7 tenants moved into Lasata Care Center
- 3 tenants moved to other apartments
- 3 tenants moved in with family members
- 2 tenants moved into assisted living facilities
- 2 tenants died
- 2 tenants moved into other units w/in our building
During 2003 a total of 19 tenants were admitted into Lasata
Care Center, with twelve of those being able to return to their
apartments after a period of rehabilitation.
Although at year-end 33 people remain on the wait list for an
apartment, the higher turnover and recent addition of new senior
housing options, resulted in unfilled apartments and decreased
the wait time for an apartment. The average wait is 3 months for
one-bedroom units, but we were able to accommodate immediate
move-ins in some situations, especially with the larger two
bedroom units. Although few of the new senior facilities offer
the same level of services we do, such as a daily meal,
activities, daily check-in, and emergency response systems, by
not providing these services they are able to rent for
significantly less money per month. For the first time in 16
years, we had to advertise apartment availabilities. Responding
to the unanticipated losses in rental revenue and increased
marketing costs, we continue to evaluate the effects of the
changing senior housing market and make necessary policy and
budget revisions.
Major projects completed during the year included the
replacement of carpet in the central lobby, lounges and hallway
areas; and the construction of a paved walking path for tenants.
Our budget was significantly affected by a major change in asset
capitalization/depreciation, which resulted in an unbudgeted
depreciation expense of $737,747 and a loss to revenues of
$47,284 for asset disposal. This one time large expense had a
major negative impact on our operating expenses but did not
affect actual cash flow.
Our revenue sources include rent, housekeeping fees, laundry
commission, garage parking and meal fees. Revenues at year-end,
including the loss on asset disposal, were 8% below budget and
totaled $648,677. Operating expenses with the unbudgeted
depreciation expense totaled $1,054,217, resulting in a loss of
$405,540. Adding in capital outlay expense, the principal on
debt and deducting depreciation expense, operating expenses
totaled $702,551, resulting in a deficit of $53,874. Note that
without the one time major change in asset
capitalization/depreciation, actual cash losses were $6,590.00
for 2003.