Real options theory (ROT) applies heuristics and valuation models to the domain of investment decisions and strategic management. However few research devoted on empirical analysis. To develop a strategy with managerial flexibility under uncertainty, a hypothetical senior housing project specified and empirically estimated. A qualitative strategic depiction of the problem structure indicates the various managerial decisions by synthesizing and critiquing research on real options. Empirical results suggest that irreversibility and delay are important considerations to investors. This paper concluded the value of managerial flexibility and strategy in senior housing development under risk. Alternative strategies are development, stage and divestment.