How To Thrive In Senior Living: Equity, Programming And Food
Jim Neil has never seen a failed senior housing project in all his years as director at Hunt Mortgage Group. But that's not because the industry is foolproof—far from it, in fact.
Considering Baby Boomers will enter this market in the next 10 years and about 70% of the facilities in the market were built before 2000, the senior living industry must be intentional about necessary changes to the market. At our senior living event yesterday, many of DFW's best and brightest senior housing execs shared their insight.
The senior living market offers a lot of good capital, but lenders want experienced owners and operators exclusively, Key Bank Healthcare Real Estate Capital SVP Brian Heagler (above, second from the right) says. So all you retail, office, industrial and multifamily folks looking to jump on the bandwagon (and we know there are tons of you) better find yourself a serious equity partner or someone with some skin already in the game.
Take Drever Capital Management, for example. Historically a multifamily business, Drever broke into senior housing a couple of years ago with much success thanks to a robust financing plan. Director of acquisitions Max Gonzales (below, right) says financing is more important than equity. Drever addresses the capital early on and always has recourse on the brain.
The need for renovations, redevelopments and capital for existing facilities is phenomenal, Jim says. Long-term financing—both recourse and non-recourse—can be found for strong owners and operators.
Edgemere just borrowed $36M to make extensive renovations to its continuing care retirement community. Owners and operators must be willing to dedicate non-revenue-producing space to common areas such as performing arts centers and informal dining areas, managing director John Falldine (top photo, second from left) says.
Senior housing is 10% sticks and bricks and 90% programming and people, Silverado SVP of development Paul Mullin (top photo, right) says. Silverado hosts events and fun space in its memory care facilities to help maintain residents' vibrancy as much as possible. It's seen great success with additions like libraries, brain game centers and other purposeful programming.
With the growing wellness culture overflowing into senior housing, residents must now have more options to engage their physical, emotional, spiritual and social well-being. And what's the one area of life that touches all four cornerstones of wellness? Food, obviously.
Senior residents tend to complain about two things above all others: temperature and food, Prevarian Senior Living managing principal Allan Brown (second photo, left) said. Batch cooking three meals a day and serving them on white tablecloths at 7am, noon and 5:30pm is obsolete. Residents want healthier food options and more freedom to eat where and when they choose.
Capital Senior Living SVP Carey Hendrickson (second photo, second from right) says the food director is one of the most important employees at a senior living facility. Capital Senior Living's food directors get creative and collaborate with each other on menu offerings.
All that to say, if you're looking to enter senior housing—especially as a resident—the future looks bright.