Multiple senior living operators have grown quickly in the last 12 months. In many cases, that growth was with a much larger partner.
According to the latest Argentum 150 released in June, among the companies on the “fast track” of growth are Capri Communities, which added 11 communities in the last year; Sodalis Senior Living, which added 12 communities; and Tarantino Properties, which added eight communities.
For some of these operators, the growth comes from getting new large management contracts. That includes Sodalis Senior Living, which Chicago-based real estate investment trust (REIT) Ventas last year appointed as manager of 13 independent communities flying the Sky Active banner.
“Those are huge. That almost doubled our units,” Traci Taylor-Roberts, president of Sodalis Senior Living told Senior Housing News. “Most of our growth has been within Ventas.”
Through expanding management contracts, Sodalis has maintained its fast pace of growth – and it’s equipped to take on even more ahead.
“If we’re called up and we’re asked to take on another 10 or 20 properties, we know exactly what resources and what people we need to add to that structure,” Taylor-Roberts said.
Operators on the fast track
According to the Argentum 150 list, the fastest growing operator in the last year was Retirement Unlimited Inc. (RUI), which last year acquired Brandywine Living, jumping to 59 communities in the process.
In addition to Sodalis, other operators on the fast track of growth included Houston, Texas-based Tarantino, which broke into the Argentum 150’s top 100-largest operator list this year at rank 93.
The company grew through a combination of acquisitions and expanding management services “across a wide geographic area” to expand its market share, according to Meghan Holliday, director of business development.
Waukesha, Wisconsin-based Capri Communities – a 2023 Operator to Watch – was also among the companies that grew through expanding management contracts. The company expanded its holdings to 36 communities, landing at rank no. 54.
Capri President and Chief Financial Officer Kristin Ferge said the growth comes from the efforts made to foster a “quality care environment and enjoy life” for residents in its independent living population.
According to the Argentum 150, other operators that grew quickly in the last year included Distinctive Living, which added 26 communities over the past year, part of which came from an acquisition of Validus Senior Living Management; Charter Senior Living, which added 13 communities formerly managed by Cedarhurst Senior Living; and The Aspenwood Company, which acquired four communities in North Dallas earlier this year.
Scaling operations for new growth
As they grow, senior living operators are doing so strategically, with staffing and the need to find efficiencies of scale in mind.
Capri has largely looked to grow close to its headquarters. The company avoids difficult management situations by only taking on new communities that are up to three hours away by car, according to Ferge.
Staffing is a lynchpin of senior living quality, and Capri has promoted employees from within and is collaborating with recruiters to maintain operations as it grows.
“From a recruiting perspective, we’re always aware of people who have industry experience or have an interest in joining the industry,” Ferge said. “As we have that growth and open positions, we’re able to call on people relatively quickly.”
Both Ferge and COO Geri Krupp-Gordon previously worked at Brookdale Senior Living (NYSE: BKD), the nation’s largest senior living operator.
“We’re all used to scale,” she said.
Sodalis uses mentorship programs lasting between six months to a year to keep operations running smoothly as the company grows, Taylor-Roberts said. By mentoring workers, the company ensures it has the leadership bench strength to take on new growth opportunities.
“We always have a pool of people,” Taylor-Roberts said. “We keep these mentor groups in every department, so we have it for maintenance, culinary, nursing, and sales.”
Additionally, Sodalis utilizes in-house recruiters to hire frontline staff, which allows the company to grow at a “faster pace.” The company also works with recruiters for management-level and corporate-level employees.
Communication has been another lynchpin to Sodalis’ growth. To help allow for smoother transitions when taking on new management contracts, Taylor-Roberts said the company’s corporate and regional leaders reevaluate policies, procedures, and communication lines each quarter.
Before it takes on a new community, Capri studies how it is currently operating, along with its financial performance and other regulatory or similar issues that might need ironing out. Capri’s transition plan for a new community often takes between two and three months.
To help keep the process as smooth as possible, Ferge said Capri typically offers employment for all of the existing employees who are currently working within the community. If they are a good fit with Capri’s culture, they are then offered long-term employment.
Tarantino prepares for new growth by taking “proactive measures,” including market analysis and investing in talent acquisition strategies. Recruiting has had a particular focus on its operations, clinical, and marketing teams, Holliday told Senior Housing News.
Planning for new growth ahead
The momentum for operators has largely continued since the release of the Argentum 150 earlier this year. Ferge said Capri is now up to 39 communities and is under discussions to continue to add more before the end of 2024.
Looking ahead, Capri is looking to add two to three communities per year, with no particular size target in mind.
“We want to make sure that what we currently operate, we operate well so that we maintain our reputation in the marketplace,” she said. “We’re going to be very strategic in terms of what kind of new relationships we take on.”
Capri Communities is looking to expand in markets where it already has a presence. The company also is continuing to maintain and deepen relationships with ownership groups. Talks are underway for continued expansion, though Ferge said details are currently under wraps.
Sodalis is also seeking new management contracts, though Taylor-Roberts said the company may make some acquisitions in the future once the capital markets shift to favor buyers. While growth is likely going to be slower for the company for the remainder of 2024, the focus is going to be on building up the 36 communities it has under its belt, with an additional management contract starting Aug. 1.
Looking into 2025, Taylor-Roberts would like to see an additional 10 to 15 properties added to the company’s portfolio.
Holliday said the team is planning new development projects and growth through the company’s business partners. The company is optimistic it can find more growth opportunities ahead, especially with distressed properties.
“We are committed to staying ahead of industry trends and adapting our offerings to meet the evolving needs of our residents,” she said.