According to a January Senior Housing News article, real estate investors and trusts are “avidly on the hunt” for senior housing assets in 2016. This “insatiable demand,” however, is an appetite not only for scale but for high-quality portfolios.
Good operators often bring that added component that transforms a Class B portfolio into a Class A asset. However, as S. Scott Stewart, founder and managing partner of Capitol Seniors Housing notes with some alarm, many of the best operators don’t have much capacity for new opportunities. They risk spreading their resources too thin and compromising the quality that has built their brand.
While senior housing investors want to grow, they also realize they need good operators who will hire good executive directors to run their properties. Philip Kayden, a regional senior investment officer for Ventas, Inc., is aware of the scarcity of well-established operators. He adds that Ventas is also in the market for new operators, as long as they possess certain key qualities.
So what are the qualities of a good senior housing operator? Kayden identified four for SHN that we’ll explore here in more detail.
Clear value proposition
Senior Living Smart says your value proposition starts with a thorough understanding of the competition from a prospect’s standpoint and a careful SWOT analysis (strengths, weaknesses, opportunities, threats) to help your operating team understand and craft the unique story of your community’s identity and offerings.
Good sales and marketing efforts
Investors want operators that are poised for growth. If you’re not already, learn how to gather and nurture more leads. Use your story to build relationships with prospects. Senior housing marketing specialists at Glynn Devins regularly offer great advice on their blog for building and sustaining your sales and marketing teams.
Efficiency on a national scale
If you can scale up your operation and keep it working efficiently, you’ll make a good partner for a growth-minded investor. Fortunately, there are resources for smaller operators to help them stay efficient and profitable as they grow. For large and small communities alike, staying acquainted with your story day-to-day can help to keep you from watering down your vital uniqueness.
Technology is changing the way we age, and it plays a role in every aspect of senior living operations. It keeps residents connected to loved ones, tracks medical records, promotes health and wellness, and allows for higher levels of resident privacy and autonomy. It’s also crucial for effective sales and marketing, data tracking, and widespread training and professional development. The operators who employ technology wisely will respond with greater agility to a growing, changing senior housing market.
The current state of supply-and-demand for senior housing presents unique opportunities for operators and investors to partner strategically. Those on both sides who can recognize and maintain the balance between quality and quantity should be the ones to see the most consistent long-term growth.