Predevelopment Financing from IFF Helps an Indiana Developer Address the State’s Senior Housing Squeeze July 28, 2025

Quality, affordable housing is a cornerstone of well-being for older adults, affecting their physical and mental health, financial stability, and social connections. And with the number of seniors expected to outnumber children for the first time in the United States in the next decade, it’s imperative that the housing market reflects these changing demographics. To accomplish this, the supply of affordable rental housing designed specifically for older Americans must drastically increase, providing more seniors with more housing options that meet their needs.  

Indiana, like many states, exemplifies the pressing nature of this challenge. A 2024 analysis by Indiana University’s Center for Real Estate Studies and the Indiana Business Research Center found that, by 2028, there will be more than 150,000 senior households in the state without senior-specific or age-restricted market rate housing available to them. Significant shortages also exist for subsidized and income-qualified housing, affecting seniors who are often on fixed incomes and face increasing health care costs. Already, nearly half of older renters in Central Indiana spend more than 30 percent of their income on housing. This creates financial strain that forces difficult choices between housing and other necessities like medication and food. As the population of seniors grows in the years ahead, this strain will be exacerbated unless the number of dedicated units for seniors increases to meet surging demand.   

That’s the impetus for two new development projects in Lafayette and Westfield being led by Vita Investment Holdings (Vita), an award-winning developer that specializes in the construction of housing options that meet a wide range of needs for older residents.  

In Westfield, a fast-growing community 30 miles north of downtown Indianapolis, Vita is breaking ground later this year on a 13.3-acre property that will include 80 assisted living units, 40 memory care apartments, and 44 cottages. The cottages will feature two bedrooms, and the apartments will be a mix of studio and one-bedroom units. Of the 168 total units, 128 will be offered at monthly rental rates affordable to tenants earning 60 percent or less of the Area Median Income. By locating different types of housing for older adults on the property, Vita is creating a continuum designed to provide residents with flexibility as their housing needs change over time. On-site amenities will include a spa, salon, restaurants, and shared laundry and community areas, as well as fire pits, courtyards with water features, pickleball courts, a dining and grill area, walking paths, and a dog park. 

More immediately, in Lafayette, Vita is moving forward with the development of Vita Lifestyle – Lafayette, which will transform previously vacant farmland into a mixed-income property for residents ages 55 and up. The property will include 47 market-rate apartments and 142 apartments affordable to tenants earning up to 40, 60, and 80 percent of the Area Median Income, with a four-story building housing one- and two-bedroom apartments and the garden-style cottages featuring two bedrooms. In addition to their homes, residents will benefit from amenities on the property like walking trails, pickleball courts, and a bocce ball area. Construction on the project will begin next month and is expected to be completed by the first quarter of 2027, at which point seniors in the community will have access to an affordable housing option that puts them in close proximity to two major hospitals, a pharmacy, a bank, and a broad range of retail and entertainment options.  

“In senior housing, broadly, if you want something nice, you may not be able to afford it, and if you can afford it, it may not be very nice,” said Vita CEO Zeke Turner. “Vita is bridging that gap by developing housing for a ‘middle market’ that includes teachers, firefighters, service industry employees, government workers, and nurses, among other examples. We’re not in the business of creating affordable housing as most people imagine it, but in the business of creating quality housing that’s affordable.”  

Once opened, Vita’s properties in Westfield and Lafayette will directly address the need for additional senior housing in both communities, and they’re also representative of how the development of age-restricted housing can help to alleviate the broader housing shortage in Indiana. When older adults remain in their homes, it constricts the supply of housing for everyone. By developing high-quality, affordable housing for seniors, more homes turn over, increasing the supply of housing for other types of buyers. 

“There’s a massive shortage across the country of housing that’s affordable, with too few units available at the price points needed to meet demand,” says Turner. “The situation is at a crisis point in a lot of communities, including in Indiana, and a lot of the focus on solutions is centered around building more homes for families and young professionals. But there’s another side of the equation, with an elder population that has even fewer options for where to go when remaining in their homes is no longer an option. When we create housing specifically for older adults, we’re meeting their needs and freeing up inventory for younger residents.” 

To facilitate Vita’s projects in Westfield and Lafayette, IFF provided the developer with two predevelopment loans totaling $2 million. While these loans were relatively small given the total anticipated cost of each project – $45.7 million in Lafayette and $57.9 million in Westfield – having access to flexible predevelopment financing was essential for Vita to advance the projects from concept to reality. IFF is one of the few lenders in Indiana, and across the Midwest, that offers dedicated predevelopment loans to housing developers like Vita.    

“There’s a lot of upfront capital needed for projects like these, and, as a developer, you can end up putting a million dollars or more into pursuing the project over a multiyear period before construction begins,” says Turner. “And when you’re working on more than one project at a time, those expenditures for items like property acquisition, architectural fees, and environmental testing add up quickly. Having a lending partner on the front end willing to support the predevelopment phase makes it possible for us to reduce our out-of-pocket costs so that we can do more projects in a given time period to create more quality homes for seniors.” 

To ensure that its Westfield and Lafayette properties will be affordable to the “middle market” of seniors for which the units are designed, Vita is leveraging a wide range of financing tools that will ensure cost-effective monthly rental rates. In Westfield, that includes 4% Low Income Housing Tax Credits (LIHTCs) allocated by the Indiana Housing & Community Development Authority (IHCDA), a permanent loan, tax-exempt bonds, and capital from the IHCDA Development Fund, among other sources. In Lafayette, Vita’s capital stack includes 4% LIHTCs allocated by the Indiana Housing & Community Development Authority (IHCDA), a permanent loan, tax-exempt bonds, capital from the IHCDA Development Fund, and a loan from the Indiana Finance Authority Residential Housing Infrastructure Assistance Program.  

“Rather than focusing on building as inexpensively as possible to control costs, we’re interested in delivering the best possible product we can and using the most creative financing methods that are available to us to drive down the cost of development,” says Turner. “We’re then able to charge less to live there than at a comparable development without sacrificing on quality, while still serving residents with a wide range of income levels. We want to be able to meet people where they’re at in life and provide them with a really attractive housing option that allows them to age in place in their communities.”    

Read about additional housing projects IFF has helped to facilitate across the Midwest