March 19, 2025 • 31 mins
In this episode of NIC Chats, Lisa McCracken sits down with Ryan Novaczyk, CEO of New Perspective Senior Living, to explore his insights as an operator in the senior living industry pursuing a growth strategy.
Novaczyk shares a personal story of how his grandmother's struggle with Alzheimer's inspired him and his father to create a better living environment for seniors. He discusses how his family's experience led to the founding of New Perspective, which now operates 42 communities across the U.S., focusing on providing a hospitality-driven model that emphasizes life engagement and purposeful living for its residents.
The conversation delves into the significant changes Novaczyk has witnessed over his 25 years in the industry, from technological advancements to shifts in operational complexity and increased resident acuity. He highlights the importance of collaboration and servant leadership, particularly in New Perspective's co-CEO structure, which allows for a more agile and effective management approach.
Novaczyk also touches on the challenges of new construction due to high costs and interest rates, and the opportunities arising from acquisitions and partnerships. He emphasizes the value of networking and collaboration within the industry, encouraging operators to share insights and best practices to drive growth and improve care for seniors.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:01):
Welcome
everyone to the latest Nick
Chats podcast. This is LisaMcCracken, the head of research
and analytics with NIC Super,excited to have as our guest ,
uh, today, Ryan Novacek , whois the CEO of New Perspective
senior living. Also a verydedicated Nick Volunteer. Thank
you, Ryan. I appreciate youjoining us today .
Speaker 2 (00:21):
My pleasure.
Speaker 1 (00:22):
So , uh, and I, I'm asking this question for myself
as well. I do not know this atall. I don't know your
background and how you got intothe industry, so I'm always
curious, I mean , you've beenaround for a while, but would
you give us a little historyof, of your entree in , into
the senior living space?
Speaker 2 (00:38):
Sure. So we've been at this for over , uh, 25
years. Um, got into thebusiness because my grandma had
Alzheimer's, and we as a familycouldn't find a place. We felt
, uh, good about taking her.
And , uh, we took care of herfor seven years, learned a
tremendous amount about theneeds of seniors, particularly
those with Alzheimer's andother forms of, of dementia.
(00:59):
And we kept her busy doingstuff every day , raking
leaves, shoveling snow arts andcrafts, music, family events ,
uh, going to church , um,gardening , uh, weeding , uh,
you , you name it. And most ofthe time she went to bed
because she was tired, had abig day, not because she was
doped up on antis psychotropicmedication, which is far too
(01:21):
often how we , uh, tend totreat that disease in this
country. Uh , my father Todd ,had a background in
hospitality, restaurants andhotels. Uh, I was working on
Wall Street, did investmentbanking , uh, for a number of
years , uh, mergers andacquisitions , uh, equity
research. And we cooked up abusiness plan in the basement,
and nothing happened for a fewyears. And my mom was screaming
(01:45):
at my dad to , to get a job,and he kept saying, it's gonna
work, it's gonna work. Andfinally a deal got done, and
then two, and then four. Andnow we're at , uh, 42
communities taking care of over4,000 vice , 85 year olds
helping to live life on purposeevery day .
Speaker 1 (02:03):
Uh, I had no idea that it was a family thing. I'm
, I'm actually, I've, I'malways impressed to learn the
number of families that reallyhave some legacies in our
industry. It's prettyimpressive. So , um, so your
father's still involved, or, orI'm not sure it's still Yeah ,
Speaker 2 (02:18):
He , he , he is, he is, he's our executive
chairman. So, and yeah, the,the business does lend itself
to quite a few , uh, companiesstarted , uh, from caring for
loved ones because there was adeficit in the markets they
were in, and they couldn't finda place similar to us that you
felt good about bringing yourloved one, and you set out to
(02:39):
try to make , uh, uh, theenvironment , uh, uh, not just
for your loved one, but but forothers, right . Um, uh, to, to
bring that to bear. And there'sa lot of history there.
Speaker 1 (02:50):
Yeah. So, you know, on the change front , you go
back 25 years and , and feelinglike there's not a sufficient ,
um, or at least quality of whatyou've found potentially in a
particular area for yourgrandmother, do you think we've
moved the needle as an industryon that? I mean, what have you
seen change , um, in your 25years, and maybe where do we
(03:12):
still need to go?
Speaker 2 (03:13):
I , I think everything has changed. I mean,
you go all the way back to thebeginning and, you know , you
take something simple likeusing QuickBooks . Yeah
. And then you look at the, thecomplexity of just the systems
that you're using for basic,you know, accounting and , and
finance and the complexitiesincreased exponentially. I , I
(03:34):
think that's true in everysingle aspect of the business.
The model started out , uh,very hospitality , uh, focused
, uh, trying to be theantithesis, a little bit of
the, of the skilled nursingenvironment. Mm-hmm
. And over time ,uh, the acuity of our residents
has , has risen in hospitalityis still of , of utmost
(03:56):
importance, as in lifeengagement and helping seniors
to live life on purpose. Uh,but the care needs of folks
have as they've aged and theacuity's risen. And there's,
you know, on average, I thinkfour or five comorbidities
with, with all of ourresidents, it, it's become just
very, very complex. And that'strue across every aspect of, of
(04:16):
the, of the business. Um, saleshas changed , uh, dramatically.
The, the tools we use to sellhave changed dramatically how
we identify our customersthrough psychographic and other
information has changeddramatically. The technology
just in the core physical planthas changed tremendously. I , I
got a call from one of ourdirectors inquiring about a , a
(04:39):
contract for the, the Trane ,uh, HVAC system. And it , it's
software based now. And you ,you typically wouldn't have a
contract for , uh, softwaremonitoring tool , uh, for air
conditioning and heat, butthere is one now. Um, you look
at the fire protection systems,the door access control, the,
the CCTV, there's just been atremendous amount of change.
(05:02):
The , the tools we're using onthe marketing front have
changed, used to be sending outdirect mail, and now close to
80% of our leads are comingfrom digital sources. That's a
massive change. So I thinkmm-hmm . Every
single year we've seenincreasing complexity in the
business, a tremendous amountof change, but all for the, the
(05:23):
good , uh, for improving , uh,the quality of life and, and
healthcare given to, to seniorsand, and folks do better in the
senior living setting than theydo in at home. Uh, loneliness
is a huge thing out there, and, uh, we can help to solve for
that. So , uh, probably morechanges to come on the horizon
, uh, with the introduction ofai, I , I think we're gonna see
(05:47):
the pace of technology and itsusage accelerate, and it's an
exciting time to be in seniorshousing.
Speaker 1 (05:55):
Yeah. Yeah. It seems like a lot of that, that
technology and operationalcomplexity as well is quickly
changing . And even just, youknow, in the past five years
with some of that , um, a as anoperator and , and one of the
things that we hear often is,you know, first of all, how do
you keep up with all of that?
And also, you know, the expenseof , of , of all of that. But
(06:17):
it's one of those things, youknow, if you don't, there's a
cost to doing it as well. Howdo you guys navigate that? I'm
just curious. Um, staying ontop of it. And then, you know,
the , the commitment on theinvestment side of things,
Speaker 2 (06:29):
You've gotta have the right people first and
foremost. Uh, you've gotta havevery well thought out, you
know, processes, and you needto get in alignment with your
capital partner. Uh, a lot ofthose things that I, I
mentioned that we do on themanagement side of the house
hit one , uh, p and l and a lotof those things I mentioned ,
(06:50):
uh, hit the other side of thehouse at the operating
community level , uh, whereyour capital partners are
involved. And , uh, the costhas increased exponentially to,
to just run the day-to-dayoperations of seniors. Housing
human resources is another areathat , I don't wanna say it was
ever simple, 'cause people arealways complicated , uh, to
(07:12):
deal with and, and manage. Butthe complexity there in
navigating those waters and,and really dialing things in on
the recruitment and retentionfront , uh, it requires a , a
great team of, of folks withgreat tools and systems and ,
uh, and culture. Uh, we, we arehuge believers in, in servant
leadership and collaboration atnew perspective. And that kind
(07:35):
of serves as our, our NorthStar. So we kind of add that
into the mixing bowl with greatpeople and great process. Yeah
. And continuous culturalimprovement, you can kind of
solve any problem that's outthere. Might not be
instantaneous, but if you putyour mind to it, you can, you
can work through those issuesthat , uh, that pop up.
Speaker 1 (07:53):
Yeah. Um , I, I observational just sort of the
cost and affordability piece.
Now, this is on the consumerside of things. As I was , um,
preparing for our timetogether, I was digging around
the website and you guys have apretty cool, it's called senior
and assisted living costcalculator. And , um, you know,
you know, and probably there'ssome validity to the argument
(08:15):
that, you know, our sector doessometimes skew a little
towards, you know, a , a higherincome private pay group. But
at the same time, we also knowthat, that sometimes the aging
in place on top of theisolation things that you
referenced too , but it , youknow, if you need some support
in your home, I mean, the costof of aging in your home isn't
(08:36):
always feasible either. And,and I , I thought you , you
took a really interestingapproach with that on your
website in terms of some ofthis cost benefit . And
actually, in many respects, it, it's sometimes more costly to
live in your home than it is tohave sort of that, that
bundled, you know, hairquality, social environment.
Speaker 2 (08:54):
In , in most cases, you're exactly correct. It is
more costly to live in, in yourhome. And it could be three to
four x the price tag of whatyou'd be paying to live in a
senior living community. Andprobably you're gonna get worse
health and wellness outcomeswhen you look at, you know,
just the maintenance of mostseniors are probably don't have
(09:16):
a mortgage on their homeanymore. It's been, it's been
paid off. Uh, but propertytaxes are real, insurance costs
are real , uh, energy costs arereal. Uh, the cost of food and
food preparation , um, has gonethrough the, the roof. And it's
difficult for a senior to buyin bulk. 'cause the mm-hmm
. Typically it's,it's , uh, the, the gal that
(09:37):
the , the gal's kinda outliveus skies a little bit, and, you
know , she's home alone andyou're not able to go to Costco
and, and get savings on, ongroceries. You look at just
the, the yard maintenance , um,automobiles, getting to
appointments. So there's atremendous amount of cost , uh,
staying in your home. And thenif you do need healthcare and
senior living, assisted livingrelated services, you're
(10:00):
bringing in home health andthere's certainly a role for
home health and it's usagegoing to dramatically expand
and it , and it needs to mm-hmm . Um, but what
you miss out on is that broader, uh, setting to enable
socialization and lifeengagement and what we call
living life on purpose. And soto have, you know, daily access
(10:20):
to physical fitness, a greatdining experience, activities
happening , uh, being able to,to meet and hang out with, with
friends, new friends and oldfriends, and, and have a , a a
area where you can bring in,you know, guests and things of
that nature to, to share your,your home and your common
space. I mean, when you look ata senior living community, and
(10:41):
it's maybe a hundred to 150units , uh, there's like a
whole city going out in therewith, you know, a bar and a
bistro and a dance hall , and asalon spa, and a warm water
therapy pool, a rehab, fitnessgym. Uh, you've got service
professionals everywhere.
You've got round the clockstaffing , uh, you've got
on-call nursing in the middleof the night if that's needed.
And so any way you kind ofslice it , uh, seniors tend to
(11:04):
be better in that setting andthrive in that setting , uh,
more so than they do in thatisolated setting in their home.
And oh, by the way, it's morecost effective for them in most
cases, which is why we put thatcalculator together to help
illuminate those factors.
Speaker 1 (11:20):
Yeah. No, that , that's pretty cool. Um, and I
couldn't help but have a visionin my mind when you mentioned
the , the , the bar, the pubof, have you seen a man on the
inside and Ted dancesince first night in the
retirement community? They hada good time. If you haven't
seen it, check it out. It'spretty funny. . Um, so
you mentioned , um, you know,the right capital partners. So
(11:41):
new perspective, you guys had apretty big splash last year
about , um, you know, some, acapital commitment , um, sure .
And, you know, a pretty clearplan around growth of the
organization. Can you talkabout that a little bit?
Speaker 2 (11:58):
So, several years ago we set a goal of getting to
10,000 seniors living life onpurpose, and we're just about
halfway there. So lots of workto do, but the, the pace is
accelerating a little bit in ,in its exciting. Uh, to achieve
that goal. Uh, you need to havegreat capital partners, great
equity partners, great reappartners , uh, great lending
(12:18):
partners. Uh, every deal is alittle bit unique, and we've
been very blessed to, to have awonderful , uh, equity group
and , and our partners Bolt andFen Gate , and a great banking
relationship with, with BMO .
Um, and that capital stackworks well for certain
transactions. And then we'vegot a wonderful relationship
(12:40):
and continue to grow with, youknow, our, our biggest reap
partner , uh, Welltower . And ,uh, they've been probably
growing their , their book ofbusiness more so than any other
capital group that that's outthere. So we , we love working
with them and they've got a bigappetite, as do we for, for
growth. And depending on thetransaction, you try to find,
you know, what is the right fitbased on the dynamics? Is it a
(13:03):
big value add deal with a, witha turnaround? Is it a brand new
building that's 95% occupiedand knock it out 35 40% NOI
margins? And your job is justto keep the, the car on the
road. Uh, is it a massive, youknow, turnaround effort where
the physical plant needs to betotally refurbished, remodeled,
(13:23):
refreshed, and the team needsto be , uh, really , uh, uh,
ramped up and, and improvedfrom a a people quality
standpoint, a processstandpoint. So there's all
these different deals out therethat have different risk
profiles that mm-hmm . That fitdifferently with different
capital partners. Um, certainlydon't want to have 6, 7, 8, 9
capital partners because assetmanagement has become a much ,
(13:47):
uh, bigger deal for them. Ummm-hmm . They're
much more involved in learningabout the day-to-day
operations, and that's a goodthing. Uh, the more knowledge
base that that capital partnershave that we can share with
them , uh, we're gonna makebetter investment decisions
together as a team. Uh, butthat's, you know , one of those
other changes we were talkingabout earlier that I didn't
(14:08):
mention. Um, we are much moreattached at the hip with all of
our capital partners talkingthrough what's going on in the
day-to-day and, and sharingideas and insight and, and
collaboration. And that's,that's driving good outcomes.
So , uh, we're very pleasedwith, you know, where we're at
in the, in the pools ofcapital, we've got to go
execute on the, on the growthplan. And , uh, there's a , a ,
(14:33):
a ton of great activityhappening every single day. We
probably evaluate severaltransactions a week , um, wow.
You know, hundreds over thecourse of a year, but only
about 5% or less shake out thebottom end of that, that
funnel. So you've got a lot ofleads that go into the top of
the funnel and you processthrough underwriting an
investment committee, and thenyou get approvals and those
(14:55):
things shake out, and then youactually gotta go Yeah . You
know, negotiate and close a , atransaction. So a lot of
activity has to happen for afairly, you know, small number
of deals to come out the bottomof that funnel. But it
continues to grow. The teamcontinues to grow , and we're
excited about the opportunitiesthat are out there in the space
to hopefully reach our goal of10,000 seniors , uh, living
(15:16):
life on purpose in the not toodistant future.
Speaker 1 (15:20):
That , that is crazy. The number that you just
quoted. So, man, yeah. You needa team to, to stay on top of
that. I do wanna spend a littletime talking about as it
relates to the team, so youhave, you know, what I will
call a unique, but also I'mobserving a little bit of a
growing that you , you're notalone in the structure in terms
of the, the co CEO or, and wasthe CEO present or co CEOI
(15:42):
believe structure , um, withyour organization, which I ,
where I've seen work very well, um, with the right
organizations, others, if youdon't have the right setup ,
, um, you know, and Ithink the right people as well,
it , it cannot go so well. Socan you talk a little bit about
just what the structure is andthen the rationale behind it
(16:02):
and maybe a little bit the ,the division and sort of divide
and conquer? Sure .
Speaker 2 (16:07):
So I'm one of the cos and the CO CEO structure
over here at New Perspective.
Uh, Chris Hyatt is my partnerin crime, and we've had this
structure in place. We were , Ithink, one of the first to do
it in this space, not, not inbusiness, in , yeah , in
general. I mean, you can goback to, to Michael Dell , um,
where the CEO and the CO werekind of mm-hmm .
(16:29):
There's actually a book writtenabout it called Riding Shotgun,
which is an interesting read,but it really talks about, you
know, why it's so important tohave kind of those two roles
merged, you know, together,where, you know, the right hand
always knows what the left handis doing and, and , and vice
versa. So because of thecomplexity that we've talked
(16:49):
about so far , uh, that wasreally the, the reason behind
this. And , and this is true inother businesses. Netflix as an
example, as a co CEO structure,and there's lots of other
examples out there when youlook at the, the areas you need
to cover. Um, it , it is just,it , it's, it's massive. It's
(17:09):
sales, it's marketing, it'shuman resources, it's
information technology, it'sfinance, it's accounting, it's
treasury management, it's assetmanagement, it's investment,
it's risk, it's legal. I mean,I could go on and on and on.
Mm-hmm . Oneperson is very difficult to
tackle all of those things. Andwhen you do the typical
(17:31):
hierarchical pyramid structure,you tend to get more latency,
slower decision making , andprobably less attention to the
team members you need tosupport mm-hmm .
In each of those areas. Mm-hmm . By flattening
out the org chart a little bitwith that co CEO structure and
having a divide and conquerapproach , uh, we have found it
(17:53):
to be , uh, much more effective, uh, than the traditional ,
uh, structure. And , uh, Chrishas got his areas that he's
generally focused on mm-hmm . And I've got my
area , my areas, I can do hisjob, he can do my job, and
neither guy does each other'sguy job quite as good as as the
other guy, but we, we figureout a way to get it done. And I
can step in his shoes if he'sout on vacation, or if there's
(18:16):
a big project that I'm workingon, he can step in my shoes in
certain instances. And so it'snot just about coverage, but
we're getting more , uh,leadership and direction to the
team , uh, quicker. And yougotta have, you know, just a
fantastic partnership to pullthat off. There needs to be an
unbelievable amount of trustbetween the two co-CEOs, and
(18:39):
we're very blessed in thatregard . And, and you've gotta
be able to have, you know,radical candor , uh, with one
another and be intellectuallyhonest, even though sometimes
it's uncomfortable to havethose discussions. And, and
Chris and I are blessed to haveall those things. Doesn't mean
we agree on everything mm-hmm . All of the
time, but we're able tocomplete each other's sentences
in most cases. And we're ableto deliver kind of a common,
(19:04):
you know, hi , his messagingmight be subtly different than
mine in regards to the, theteam mm-hmm . But
we, we figure it out. And ifwe've got a disagreement, you
kind of take that offline. Youdon't, you know, air that or
broadcast it in front of thebroader group. Although
occasionally we'll debate onthings in front of the broader
group and you just kinda workthrough. And , and so we found
(19:24):
it to be quite refreshing. Um,it's new, it's fun, it's, it's
exciting. There's other folksreplicating that in the, in the
space. There's been a number ofinterviews we've done on that
topic, and I've seen a numberof articles published of late
that more people are trying itand it's not for everybody. Um
, right . But if you've got twofolks that have got, you know,
(19:45):
that type of, you know , amindset and, and can kind of
check the ego at the door alittle bit and just want to go
help seniors live life onpurpose, I think people will
find it's a better way to, totackle , uh, running a , a
business in our space. And, andmaybe in general, you're seeing
lots of other companiesexperiment with it outside of
the senior living sector aswell.
Speaker 1 (20:06):
Yeah. Good for you.
Yeah, I do think that the egocheck is a big one. And, you
know, just communication andtrust. So , um, that , I think
that's awesome. I , I wanna goback to the, the growth
conversation a little bit. Soin all of that transaction
activity, and you were talkingabout different, you know,
opportunities you're vetting ona weekly BA basis. I didn't
(20:26):
hear anything about newconstruction. Is it in there
somewhere,? Um, maybe,maybe not, not yet .
Speaker 2 (20:32):
It's out there somewhere. Uh , where it is, I
, I don't know , , ithas been unbelievably , uh,
frustrating. Yeah. Um, on thedevelopment construction side
of things, construction costsare still way too high. That's
coupled with interest ratesthat are way above where they
used to be. And it is very,very difficult to get the
(20:56):
economics to pencil out on anew construction project.
Unfortunately, I don't thinkthat's gonna change , uh,
anytime soon. And thoseheadwinds for new construction
and development are happeningat a time where there's a lot
of , uh, acquisitionopportunity that that's out
there. Uh, we've identified,you know, three emotional
(21:18):
shifts that we think sellersare going through in the
marketplace. You've got folksthat have been doing this for
20, 30, 40 years, and they'rekind of, you know, at the end
of the road and ready forretirement. Um mm-hmm
. They've gonethrough four plus years of, of
hell on wheels getting throughCovid and coming out of the
pandemic. And hopefully this isthe year we get back to pre
(21:42):
pandemic, you know, occupancy.
Mm-hmm . And I , I think that'sgonna happen, and I think it's
gonna be a rocket ship afterthat because of the supply
demand imbalance, in part dueto the lack of new supply being
brought online , um, throughconstruction. But those folks
care a lot about the industry.
Uh, they care a ton about theirresidents and their team
members, and they want to makesure whoever they pass the
(22:04):
baton to at their business hasa similar mindset to them. You
know, servant leadership,collaboration mm-hmm . Seniors,
living life on purpose. All ofthose things resonate with that
pool of sellers, and that'screating a lot of opportunities
where we might not be thehighest bidder on a
transaction, but we're the bestfit for the seller. Mm-hmm
. And thatmatters almost as much to those
(22:27):
folks as, as the monetary sideof the equation. Then you've
got the, the tourists as , aswe call them, that got into the
business. Yeah . I thinkthere's more tourists , the
develop the development shops,the, the merchant builders, the
, oh, it's seniors housing andthe baby boomers, and
everything's super easy andit's gonna be great, and we're
gonna build all these things.
And all of a sudden Covidhappens and everybody's like,
(22:48):
oh. Pardon my French, this ishealthcare and this is a 80%
operations business thathappens to need a real estate
box to operate in mm-hmm . And that
epiphany's happening. And thosefolks are also moving a decent
amount of product to folks thatare in this for a little bit of
the longer term versus the, thedevelopment, you know, real
(23:08):
estate, you know, pop. And thenyou've got a lot of the, the
companies that were startupsthat have grown , uh, got to
three or five or maybe eightbuildings or could be one. And
it's just very difficult to getthe business to scale. It's
tough to have all of the teammembers you need to manage all
those things we discussedearlier , uh, to have a
(23:31):
full-blown human resource teamand a full blown information
technology team. If you gotfive buildings, you , you can't
afford to do that. So you got apotpourri of insourcing this
outsourcing that , uh, youdon't have any buying power. So
procurement is tough. Uh, youdon't have any buying power on,
on health insurance. That'stough. Uh , general insurance
(23:53):
also very tough when you'resmaller. You don't have the
diversified, you know, pool of,of assets to offer up to a a
carrier to get better pricing.
Everything's difficult and, butyou still have got aspirations
to grow. So we think there'sgonna be a lot of m and a
around those opportunitieswhere it might not just be real
estate trading hands, it couldbe management companies , uh,
(24:15):
you know , either beingacquired and or merging , um,
with a larger group. And, andwhat we've found in
discussions, we've, we've had,you know, and you know, too
soon to tell, but I thinkthere's gonna be a lot of
activity , uh, this year. Ithink you're gonna see us , uh,
transact in that area this yearwhere, where two groups could
maybe run faster together Yeah.
Uh , than they can apart. And,you know, we think those three
(24:38):
emotional shifts are gonnadrive, you know, continued
growth and fuel us getting toour goal of 10,000 seniors
living life on purpose.
Speaker 1 (24:46):
Yeah. There's always that conversation of the sort
of the organic growth, which is, uh, you know, it , it , you ,
you can get there, but it ishard work. I mean, it's all
hard work versus growing inpartnerships . So I I, I don't
disagree. I don't see it as oneversus the other, but I , you
know, I think we're gonna seecertainly plenty of both. So
you are part of our groupthat's helping us and , and the
(25:07):
committee that's really behindthe, the gr nic growth
conference. And, and you know,the reality is that , you know
, and obviously you're supportof this, is we need to give
some of those operators thetools they need to, to grow,
grow in smart ways , um, sharelessons learned. Um, and
because at the end of the day ,um, them performing well is
(25:30):
sort of, you know, rising tideraises all ships and so forth.
So , um, is there any advicethat you wish you had early on
when you were in some of thoseearly growth stages of those
tough years that , um, you ,you know, advice that you wish
you had gotten or, you know,lessons learned that you would
share with others that are inthat sort of smaller needing to
scale up phase?
Speaker 2 (25:52):
Well, I'll share a couple of of stories there,
but, but you're right, that isthe exact topic we're gonna be
covering Yeah . At the NICgrowth conference in, in
Indianapolis in in May. So Ithink it's gonna be a great
opportunity for a lot of those,you know, smaller operators to
come and learn from folks thatstarted with one and then went
(26:12):
to two and got to 10 or 20 or50, and, and sharing a lot of
those lessons learned along theway. And then we're gonna be
able to, I think, give folks alot of real world insight into
practical things they can bedoing , uh, on their growth
journey to get their businessesto, to scale and, and do so in
(26:35):
an efficient and, and, and, youknow, hopefully as low risk a
possible type of a type of amanner. So it's gonna be a
great discussion Yeah . InIndianapolis and very much
looking forward to sharing alot of those best practices in
the different areas we're gonnabe covering. Uh, whether it's
employee, you know, related ,uh, items, recruitment,
retention. Mm-hmm . How do weuse data to drive those things?
(26:56):
How do we reduce risk , uh,resident, how do we improve
health and wellness,value-based care? Mm-hmm
. Is a bigdiscussion topic that's gonna
be happening at spring, Nick ,as well as at the growth
conference and wrappingancillary healthcare services
around the residents we're,we're serving every day. But
going back to the, the lessonslearned in advice , God , we,
we've been very blessed alongthe way. One of the unique
(27:20):
parts about the senior livingindustry is it's not like
McDonald's and Burger Kingacross the street from one
another, where they're justconstantly, you know, competing
and, and fighting it out.
Mm-hmm . Um , ournumber one competitor are folks
staying in their home. Right .
So, to that end, you typicallysee an exceptional amount of,
of collaboration and sharingamongst the operators in the
(27:43):
space. Whether you go to ourGenum conference or Naasha
conference or ANIC conference,you see that on display. And
when outsiders come and join anorganization and show up at one
of these things, they literallycan't believe. What do you mean
you told your competitor, youknow, how to run their memory
care program, or you sharedthis technology insight with
them . It's, it's like aforeign concept to them. Um,
(28:06):
and , uh, I , if, if I could goback and tell myself, you know,
25 years ago , um, you know,some, some recommendations and
lessons learned, it would be donot be afraid to, to , to reach
out and, and tap your peers andhave those discussions. You'll
be surprised. They'll, they'llpick up the phone , uh, they'll
listen to you , uh, they'llbounce ideas off of you. I I
(28:29):
literally just did this with a, a guy I met at a charity
event a year ago who's got a 10unit, you know, memory care
community , uh, just west of,of, or east of Minneapolis. And
, and he called and they werehaving some recruitment and
retention issues. So we ideatedthrough it. It was 15, 20
minutes. Mm-hmm .
I built a relationship. Whoknows, maybe something happens
(28:50):
between our two groups at somepoint, right. In the future.
But it's leveraged theresources that are there , uh,
that the trade groups have putforth. Uh, NIC has been a , a
leader there, or a gentleman'sbeen a , a leader there and ,
and reach out and, andcollaborate with, with your
peers. And we've benefited fromcountless thought leaders, you
know, in the space , uh, overthe years that have just shared
(29:13):
a tremendous amount of insightand intellectual property with
us that's helped us build ourorganization. And it's all been
in the spirit of we gotta getbetter together as an industry.
And if we do a really, reallygood job that's going to
mitigate the regulatorycomplexity and all of the
waters we need to, to navigatethere, it's kinda like a
(29:33):
self-policing , uh, mechanism.
But it's, it's reach out toyour peers and, and, and
collaborate. Um, and we did afair amount of that, but, you
know, I wish we would've donemore of it earlier on because
we've just learned so much ,uh, from our peers over the
years and it's helped us , uh,in immeasurable ways as we've
grown the organization.
Speaker 1 (29:53):
Yeah. And, and candidly, there's more now than
ever. So there's really not alack of, of, you know, a
network or resources. So , um,well, we appreciate you sharing
your thoughts with us, and, andI know the listeners , uh, will
as well again. Um ,
Speaker 2 (30:07):
And the way to do that is to come to the Growth
conference in May inIndianapolis .
Wonderful . There'll be lots ofus operators there to rub
shoulders with. Yeah.
Speaker 1 (30:14):
Yeah. Indianapolis is great. Shameless
Speaker 2 (30:17):
Plug for the conference.
Speaker 1 (30:18):
Yeah, no, I, I, I'm very passionate about the
growth topic. 'cause I thinkthat there , there's smart
growth there . You know, peopleare very, again, open about
what has worked, what hasn'tworked, and, and this is sort
of the first
Speaker 2 (30:31):
Thing . If the company's not busy growing,
it's busy dying. And if youwant the best people, you need
to be growing because they wantto grow their careers. It , it
is so important and growing isfun, and it's exciting, it's
challenging, it's a lot of hardwork , um, right . But
downsizing is not fun,it's not exciting. It , it's
(30:52):
more challenging. So point thatNorth Star and , and grow , uh,
that that'd be a nugget ofadvice to share with folks.
Speaker 1 (30:59):
I, I, I've stole this saying a number of years
ago. I heard it from somebodythat said, pick your hard .
Right. It's all hard. So like,you know, pick the hard that's
gonna move you in the positivedirection versus, you know,
stagnation and, and thealternative. Well, thank you
again, Ryan. Uh, you know,appreciate it and , um, look
forward to continuing , towatching your organization and
(31:19):
the great work that you'redoing. So thank you all , uh,
listeners to the Nic Chatspodcast, you can access , um,
certainly this edition of thepodcast as well as other Nic
chats podcasts on the NICwebsite is@www.nic.org . Thanks
for listening today.
Speaker 2 (31:36):
Thanks Lisa.
Appreciate it.
Speaker 1 (31:39):
That's it. Awesome.
Great conversation. I feel likeI could talk for hours, but
that was awesome. Reallyappreciate your time. I know
you're busy.
Speaker 2 (31:47):
My pleasure. So , okay . I'm gonna miss you next
week. So I'm up in Canada atone of my wife's , uh,
snowboard races, but , uh,Chris will be there talking on
the value-based care panel Yeah. With , with a few folks. So
definitely say hi to him and,and , um, Adam on my team. I
haven't met him yet, sittingright behind me. Uh , we'll be
out there as well, so be good .
Awesome .
Speaker 1 (32:06):
Well , good luck to your wife.
Speaker 2 (32:07):
Yep . Enjoy Sandy Diego . Appreciate it. Thanks .
Speaker 1 (32:10):
See Ryan. Bye .
Chats podcast. This is LisaMcCracken, the head of research
and analytics with NIC Super,excited to have as our guest ,
uh, today, Ryan Novacek , whois the CEO of New Perspective
senior living. Also a verydedicated Nick Volunteer. Thank
you, Ryan. I appreciate youjoining us today .
Speaker 2 (00:21):
My pleasure.
Speaker 1 (00:22):
So , uh, and I, I'm asking this question for myself
as well. I do not know this atall. I don't know your
background and how you got intothe industry, so I'm always
curious, I mean , you've beenaround for a while, but would
you give us a little historyof, of your entree in , into
the senior living space?
Speaker 2 (00:38):
Sure. So we've been at this for over , uh, 25
years. Um, got into thebusiness because my grandma had
Alzheimer's, and we as a familycouldn't find a place. We felt
, uh, good about taking her.
And , uh, we took care of herfor seven years, learned a
tremendous amount about theneeds of seniors, particularly
those with Alzheimer's andother forms of, of dementia.
(00:59):
And we kept her busy doingstuff every day , raking
leaves, shoveling snow arts andcrafts, music, family events ,
uh, going to church , um,gardening , uh, weeding , uh,
you , you name it. And most ofthe time she went to bed
because she was tired, had abig day, not because she was
doped up on antis psychotropicmedication, which is far too
(01:21):
often how we , uh, tend totreat that disease in this
country. Uh , my father Todd ,had a background in
hospitality, restaurants andhotels. Uh, I was working on
Wall Street, did investmentbanking , uh, for a number of
years , uh, mergers andacquisitions , uh, equity
research. And we cooked up abusiness plan in the basement,
and nothing happened for a fewyears. And my mom was screaming
(01:45):
at my dad to , to get a job,and he kept saying, it's gonna
work, it's gonna work. Andfinally a deal got done, and
then two, and then four. Andnow we're at , uh, 42
communities taking care of over4,000 vice , 85 year olds
helping to live life on purposeevery day .
Speaker 1 (02:03):
Uh, I had no idea that it was a family thing. I'm
, I'm actually, I've, I'malways impressed to learn the
number of families that reallyhave some legacies in our
industry. It's prettyimpressive. So , um, so your
father's still involved, or, orI'm not sure it's still Yeah ,
Speaker 2 (02:18):
He , he , he is, he is, he's our executive
chairman. So, and yeah, the,the business does lend itself
to quite a few , uh, companiesstarted , uh, from caring for
loved ones because there was adeficit in the markets they
were in, and they couldn't finda place similar to us that you
felt good about bringing yourloved one, and you set out to
(02:39):
try to make , uh, uh, theenvironment , uh, uh, not just
for your loved one, but but forothers, right . Um, uh, to, to
bring that to bear. And there'sa lot of history there.
Speaker 1 (02:50):
Yeah. So, you know, on the change front , you go
back 25 years and , and feelinglike there's not a sufficient ,
um, or at least quality of whatyou've found potentially in a
particular area for yourgrandmother, do you think we've
moved the needle as an industryon that? I mean, what have you
seen change , um, in your 25years, and maybe where do we
(03:12):
still need to go?
Speaker 2 (03:13):
I , I think everything has changed. I mean,
you go all the way back to thebeginning and, you know , you
take something simple likeusing QuickBooks
. And then you look at the, thecomplexity of just the systems
that you're using for basic,you know, accounting and , and
finance and the complexitiesincreased exponentially. I , I
(03:34):
think that's true in everysingle aspect of the business.
The model started out , uh,very hospitality , uh, focused
, uh, trying to be theantithesis, a little bit of
the, of the skilled nursingenvironment. Mm-hmm
has , has risen in hospitalityis still of , of utmost
(03:56):
importance, as in lifeengagement and helping seniors
to live life on purpose. Uh,but the care needs of folks
have as they've aged and theacuity's risen. And there's,
you know, on average, I thinkfour or five comorbidities
with, with all of ourresidents, it, it's become just
very, very complex. And that'strue across every aspect of, of
(04:16):
the, of the business. Um, saleshas changed , uh, dramatically.
The, the tools we use to sellhave changed dramatically how
we identify our customersthrough psychographic and other
information has changeddramatically. The technology
just in the core physical planthas changed tremendously. I , I
got a call from one of ourdirectors inquiring about a , a
(04:39):
contract for the, the Trane ,uh, HVAC system. And it , it's
software based now. And you ,you typically wouldn't have a
contract for , uh, softwaremonitoring tool , uh, for air
conditioning and heat, butthere is one now. Um, you look
at the fire protection systems,the door access control, the,
the CCTV, there's just been atremendous amount of change.
(05:02):
The , the tools we're using onthe marketing front have
changed, used to be sending outdirect mail, and now close to
80% of our leads are comingfrom digital sources. That's a
massive change. So I thinkmm-hmm
single year we've seenincreasing complexity in the
business, a tremendous amountof change, but all for the, the
(05:23):
good , uh, for improving , uh,the quality of life and, and
healthcare given to, to seniorsand, and folks do better in the
senior living setting than theydo in at home. Uh, loneliness
is a huge thing out there, and, uh, we can help to solve for
that. So , uh, probably morechanges to come on the horizon
, uh, with the introduction ofai, I , I think we're gonna see
(05:47):
the pace of technology and itsusage accelerate, and it's an
exciting time to be in seniorshousing.
Speaker 1 (05:55):
Yeah. Yeah. It seems like a lot of that, that
technology and operationalcomplexity as well is quickly
changing . And even just, youknow, in the past five years
with some of that , um, a as anoperator and , and one of the
things that we hear often is,you know, first of all, how do
you keep up with all of that?
And also, you know, the expenseof , of , of all of that. But
(06:17):
it's one of those things, youknow, if you don't, there's a
cost to doing it as well. Howdo you guys navigate that? I'm
just curious. Um, staying ontop of it. And then, you know,
the , the commitment on theinvestment side of things,
Speaker 2 (06:29):
You've gotta have the right people first and
foremost. Uh, you've gotta havevery well thought out, you
know, processes, and you needto get in alignment with your
capital partner. Uh, a lot ofthose things that I, I
mentioned that we do on themanagement side of the house
hit one , uh, p and l and a lotof those things I mentioned ,
(06:50):
uh, hit the other side of thehouse at the operating
community level , uh, whereyour capital partners are
involved. And , uh, the costhas increased exponentially to,
to just run the day-to-dayoperations of seniors. Housing
human resources is another areathat , I don't wanna say it was
ever simple, 'cause people arealways complicated , uh, to
(07:12):
deal with and, and manage. Butthe complexity there in
navigating those waters and,and really dialing things in on
the recruitment and retentionfront , uh, it requires a , a
great team of, of folks withgreat tools and systems and ,
uh, and culture. Uh, we, we arehuge believers in, in servant
leadership and collaboration atnew perspective. And that kind
(07:35):
of serves as our, our NorthStar. So we kind of add that
into the mixing bowl with greatpeople and great process. Yeah
. And continuous culturalimprovement, you can kind of
solve any problem that's outthere. Might not be
instantaneous, but if you putyour mind to it, you can, you
can work through those issuesthat , uh, that pop up.
Speaker 1 (07:53):
Yeah. Um , I, I observational just sort of the
cost and affordability piece.
Now, this is on the consumerside of things. As I was , um,
preparing for our timetogether, I was digging around
the website and you guys have apretty cool, it's called senior
and assisted living costcalculator. And , um, you know,
you know, and probably there'ssome validity to the argument
(08:15):
that, you know, our sector doessometimes skew a little
towards, you know, a , a higherincome private pay group. But
at the same time, we also knowthat, that sometimes the aging
in place on top of theisolation things that you
referenced too , but it , youknow, if you need some support
in your home, I mean, the costof of aging in your home isn't
(08:36):
always feasible either. And,and I , I thought you , you
took a really interestingapproach with that on your
website in terms of some ofthis cost benefit . And
actually, in many respects, it, it's sometimes more costly to
live in your home than it is tohave sort of that, that
bundled, you know, hairquality, social environment.
Speaker 2 (08:54):
In , in most cases, you're exactly correct. It is
more costly to live in, in yourhome. And it could be three to
four x the price tag of whatyou'd be paying to live in a
senior living community. Andprobably you're gonna get worse
health and wellness outcomeswhen you look at, you know,
just the maintenance of mostseniors are probably don't have
(09:16):
a mortgage on their homeanymore. It's been, it's been
paid off. Uh, but propertytaxes are real, insurance costs
are real , uh, energy costs arereal. Uh, the cost of food and
food preparation , um, has gonethrough the, the roof. And it's
difficult for a senior to buyin bulk. 'cause the mm-hmm
(09:37):
the , the gal's kinda outliveus skies a little bit, and, you
know , she's home alone andyou're not able to go to Costco
and, and get savings on, ongroceries. You look at just
the, the yard maintenance , um,automobiles, getting to
appointments. So there's atremendous amount of cost , uh,
staying in your home. And thenif you do need healthcare and
senior living, assisted livingrelated services, you're
(10:00):
bringing in home health andthere's certainly a role for
home health and it's usagegoing to dramatically expand
and it , and it needs to mm-hmm
you miss out on is that broader, uh, setting to enable
socialization and lifeengagement and what we call
living life on purpose. And soto have, you know, daily access
(10:20):
to physical fitness, a greatdining experience, activities
happening , uh, being able to,to meet and hang out with, with
friends, new friends and oldfriends, and, and have a , a a
area where you can bring in,you know, guests and things of
that nature to, to share your,your home and your common
space. I mean, when you look ata senior living community, and
(10:41):
it's maybe a hundred to 150units , uh, there's like a
whole city going out in therewith, you know, a bar and a
bistro and a dance hall , and asalon spa, and a warm water
therapy pool, a rehab, fitnessgym. Uh, you've got service
professionals everywhere.
You've got round the clockstaffing , uh, you've got
on-call nursing in the middleof the night if that's needed.
And so any way you kind ofslice it , uh, seniors tend to
(11:04):
be better in that setting andthrive in that setting , uh,
more so than they do in thatisolated setting in their home.
And oh, by the way, it's morecost effective for them in most
cases, which is why we put thatcalculator together to help
illuminate those factors.
Speaker 1 (11:20):
Yeah. No, that , that's pretty cool. Um, and I
couldn't help but have a visionin my mind when you mentioned
the , the , the bar, the pubof, have you seen a man on the
inside
retirement community? They hada good time. If you haven't
seen it, check it out. It'spretty funny.
you mentioned , um, you know,the right capital partners. So
(11:41):
new perspective, you guys had apretty big splash last year
about , um, you know, some, acapital commitment , um, sure .
And, you know, a pretty clearplan around growth of the
organization. Can you talkabout that a little bit?
Speaker 2 (11:58):
So, several years ago we set a goal of getting to
10,000 seniors living life onpurpose, and we're just about
halfway there. So lots of workto do, but the, the pace is
accelerating a little bit in ,in its exciting. Uh, to achieve
that goal. Uh, you need to havegreat capital partners, great
equity partners, great reappartners , uh, great lending
(12:18):
partners. Uh, every deal is alittle bit unique, and we've
been very blessed to, to have awonderful , uh, equity group
and , and our partners Bolt andFen Gate , and a great banking
relationship with, with BMO .
Um, and that capital stackworks well for certain
transactions. And then we'vegot a wonderful relationship
(12:40):
and continue to grow with, youknow, our, our biggest reap
partner , uh, Welltower . And ,uh, they've been probably
growing their , their book ofbusiness more so than any other
capital group that that's outthere. So we , we love working
with them and they've got a bigappetite, as do we for, for
growth. And depending on thetransaction, you try to find,
you know, what is the right fitbased on the dynamics? Is it a
(13:03):
big value add deal with a, witha turnaround? Is it a brand new
building that's 95% occupiedand knock it out 35 40% NOI
margins? And your job is justto keep the, the car on the
road. Uh, is it a massive, youknow, turnaround effort where
the physical plant needs to betotally refurbished, remodeled,
(13:23):
refreshed, and the team needsto be , uh, really , uh, uh,
ramped up and, and improvedfrom a a people quality
standpoint, a processstandpoint. So there's all
these different deals out therethat have different risk
profiles that mm-hmm . That fitdifferently with different
capital partners. Um, certainlydon't want to have 6, 7, 8, 9
capital partners because assetmanagement has become a much ,
(13:47):
uh, bigger deal for them. Ummm-hmm
much more involved in learningabout the day-to-day
operations, and that's a goodthing. Uh, the more knowledge
base that that capital partnershave that we can share with
them , uh, we're gonna makebetter investment decisions
together as a team. Uh, butthat's, you know , one of those
other changes we were talkingabout earlier that I didn't
(14:08):
mention. Um, we are much moreattached at the hip with all of
our capital partners talkingthrough what's going on in the
day-to-day and, and sharingideas and insight and, and
collaboration. And that's,that's driving good outcomes.
So , uh, we're very pleasedwith, you know, where we're at
in the, in the pools ofcapital, we've got to go
execute on the, on the growthplan. And , uh, there's a , a ,
(14:33):
a ton of great activityhappening every single day. We
probably evaluate severaltransactions a week , um, wow.
You know, hundreds over thecourse of a year, but only
about 5% or less shake out thebottom end of that, that
funnel. So you've got a lot ofleads that go into the top of
the funnel and you processthrough underwriting an
investment committee, and thenyou get approvals and those
(14:55):
things shake out, and then youactually gotta go Yeah . You
know, negotiate and close a , atransaction. So a lot of
activity has to happen for afairly, you know, small number
of deals to come out the bottomof that funnel. But it
continues to grow. The teamcontinues to grow , and we're
excited about the opportunitiesthat are out there in the space
to hopefully reach our goal of10,000 seniors , uh, living
(15:16):
life on purpose in the not toodistant future.
Speaker 1 (15:20):
That , that is crazy. The number that you just
quoted. So, man, yeah. You needa team to, to stay on top of
that. I do wanna spend a littletime talking about as it
relates to the team, so youhave, you know, what I will
call a unique, but also I'mobserving a little bit of a
growing that you , you're notalone in the structure in terms
of the, the co CEO or, and wasthe CEO present or co CEOI
(15:42):
believe structure , um, withyour organization, which I ,
where I've seen work very well, um, with the right
organizations, others, if youdon't have the right setup ,
it , it cannot go so well. Socan you talk a little bit about
just what the structure is andthen the rationale behind it
(16:02):
and maybe a little bit the ,the division and sort of divide
and conquer? Sure .
Speaker 2 (16:07):
So I'm one of the cos and the CO CEO structure
over here at New Perspective.
Uh, Chris Hyatt is my partnerin crime, and we've had this
structure in place. We were , Ithink, one of the first to do
it in this space, not, not inbusiness, in , yeah , in
general. I mean, you can goback to, to Michael Dell , um,
where the CEO and the CO werekind of mm-hmm
(16:29):
There's actually a book writtenabout it called Riding Shotgun,
which is an interesting read,but it really talks about, you
know, why it's so important tohave kind of those two roles
merged, you know, together,where, you know, the right hand
always knows what the left handis doing and, and , and vice
versa. So because of thecomplexity that we've talked
(16:49):
about so far , uh, that wasreally the, the reason behind
this. And , and this is true inother businesses. Netflix as an
example, as a co CEO structure,and there's lots of other
examples out there when youlook at the, the areas you need
to cover. Um, it , it is just,it , it's, it's massive. It's
(17:09):
sales, it's marketing, it'shuman resources, it's
information technology, it'sfinance, it's accounting, it's
treasury management, it's assetmanagement, it's investment,
it's risk, it's legal. I mean,I could go on and on and on.
Mm-hmm
tackle all of those things. Andwhen you do the typical
(17:31):
hierarchical pyramid structure,you tend to get more latency,
slower decision making , andprobably less attention to the
team members you need tosupport mm-hmm
In each of those areas. Mm-hmm
out the org chart a little bitwith that co CEO structure and
having a divide and conquerapproach , uh, we have found it
(17:53):
to be , uh, much more effective, uh, than the traditional ,
uh, structure. And , uh, Chrishas got his areas that he's
generally focused on mm-hmm
area , my areas, I can do hisjob, he can do my job, and
neither guy does each other'sguy job quite as good as as the
other guy, but we, we figureout a way to get it done. And I
can step in his shoes if he'sout on vacation, or if there's
(18:16):
a big project that I'm workingon, he can step in my shoes in
certain instances. And so it'snot just about coverage, but
we're getting more , uh,leadership and direction to the
team , uh, quicker. And yougotta have, you know, just a
fantastic partnership to pullthat off. There needs to be an
unbelievable amount of trustbetween the two co-CEOs, and
(18:39):
we're very blessed in thatregard . And, and you've gotta
be able to have, you know,radical candor , uh, with one
another and be intellectuallyhonest, even though sometimes
it's uncomfortable to havethose discussions. And, and
Chris and I are blessed to haveall those things. Doesn't mean
we agree on everything mm-hmm
time, but we're able tocomplete each other's sentences
in most cases. And we're ableto deliver kind of a common,
(19:04):
you know, hi , his messagingmight be subtly different than
mine in regards to the, theteam mm-hmm
we, we figure it out. And ifwe've got a disagreement, you
kind of take that offline. Youdon't, you know, air that or
broadcast it in front of thebroader group. Although
occasionally we'll debate onthings in front of the broader
group and you just kinda workthrough. And , and so we found
(19:24):
it to be quite refreshing. Um,it's new, it's fun, it's, it's
exciting. There's other folksreplicating that in the, in the
space. There's been a number ofinterviews we've done on that
topic, and I've seen a numberof articles published of late
that more people are trying itand it's not for everybody. Um
, right . But if you've got twofolks that have got, you know,
(19:45):
that type of, you know , amindset and, and can kind of
check the ego at the door alittle bit and just want to go
help seniors live life onpurpose, I think people will
find it's a better way to, totackle , uh, running a , a
business in our space. And, andmaybe in general, you're seeing
lots of other companiesexperiment with it outside of
the senior living sector aswell.
Speaker 1 (20:06):
Yeah. Good for you.
Yeah, I do think that the egocheck is a big one. And, you
know, just communication andtrust. So , um, that , I think
that's awesome. I , I wanna goback to the, the growth
conversation a little bit. Soin all of that transaction
activity, and you were talkingabout different, you know,
opportunities you're vetting ona weekly BA basis. I didn't
(20:26):
hear anything about newconstruction. Is it in there
somewhere,
Speaker 2 (20:32):
It's out there somewhere. Uh , where it is, I
, I don't know ,
frustrating. Yeah. Um, on thedevelopment construction side
of things, construction costsare still way too high. That's
coupled with interest ratesthat are way above where they
used to be. And it is very,very difficult to get the
(20:56):
economics to pencil out on anew construction project.
Unfortunately, I don't thinkthat's gonna change , uh,
anytime soon. And thoseheadwinds for new construction
and development are happeningat a time where there's a lot
of , uh, acquisitionopportunity that that's out
there. Uh, we've identified,you know, three emotional
(21:18):
shifts that we think sellersare going through in the
marketplace. You've got folksthat have been doing this for
20, 30, 40 years, and they'rekind of, you know, at the end
of the road and ready forretirement. Um mm-hmm
hell on wheels getting throughCovid and coming out of the
pandemic. And hopefully this isthe year we get back to pre
(21:42):
pandemic, you know, occupancy.
Mm-hmm . And I , I think that'sgonna happen, and I think it's
gonna be a rocket ship afterthat because of the supply
demand imbalance, in part dueto the lack of new supply being
brought online , um, throughconstruction. But those folks
care a lot about the industry.
Uh, they care a ton about theirresidents and their team
members, and they want to makesure whoever they pass the
(22:04):
baton to at their business hasa similar mindset to them. You
know, servant leadership,collaboration mm-hmm . Seniors,
living life on purpose. All ofthose things resonate with that
pool of sellers, and that'screating a lot of opportunities
where we might not be thehighest bidder on a
transaction, but we're the bestfit for the seller. Mm-hmm
(22:27):
folks as, as the monetary sideof the equation. Then you've
got the, the tourists as , aswe call them, that got into the
business. Yeah . I thinkthere's more tourists , the
develop the development shops,the, the merchant builders, the
, oh, it's seniors housing andthe baby boomers, and
everything's super easy andit's gonna be great, and we're
gonna build all these things.
And all of a sudden Covidhappens and everybody's like,
(22:48):
oh. Pardon my French, this ishealthcare and this is a 80%
operations business thathappens to need a real estate
box to operate in mm-hmm
epiphany's happening. And thosefolks are also moving a decent
amount of product to folks thatare in this for a little bit of
the longer term versus the, thedevelopment, you know, real
(23:08):
estate, you know, pop. And thenyou've got a lot of the, the
companies that were startupsthat have grown , uh, got to
three or five or maybe eightbuildings or could be one. And
it's just very difficult to getthe business to scale. It's
tough to have all of the teammembers you need to manage all
those things we discussedearlier , uh, to have a
(23:31):
full-blown human resource teamand a full blown information
technology team. If you gotfive buildings, you , you can't
afford to do that. So you got apotpourri of insourcing this
outsourcing that , uh, youdon't have any buying power. So
procurement is tough. Uh, youdon't have any buying power on,
on health insurance. That'stough. Uh , general insurance
(23:53):
also very tough when you'resmaller. You don't have the
diversified, you know, pool of,of assets to offer up to a a
carrier to get better pricing.
Everything's difficult and, butyou still have got aspirations
to grow. So we think there'sgonna be a lot of m and a
around those opportunitieswhere it might not just be real
estate trading hands, it couldbe management companies , uh,
(24:15):
you know , either beingacquired and or merging , um,
with a larger group. And, andwhat we've found in
discussions, we've, we've had,you know, and you know, too
soon to tell, but I thinkthere's gonna be a lot of
activity , uh, this year. Ithink you're gonna see us , uh,
transact in that area this yearwhere, where two groups could
maybe run faster together Yeah.
Uh , than they can apart. And,you know, we think those three
(24:38):
emotional shifts are gonnadrive, you know, continued
growth and fuel us getting toour goal of 10,000 seniors
living life on purpose.
Speaker 1 (24:46):
Yeah. There's always that conversation of the sort
of the organic growth, which is, uh, you know, it , it , you ,
you can get there, but it ishard work. I mean, it's all
hard work versus growing inpartnerships . So I I, I don't
disagree. I don't see it as oneversus the other, but I , you
know, I think we're gonna seecertainly plenty of both. So
you are part of our groupthat's helping us and , and the
(25:07):
committee that's really behindthe, the gr nic growth
conference. And, and you know,the reality is that , you know
, and obviously you're supportof this, is we need to give
some of those operators thetools they need to, to grow,
grow in smart ways , um, sharelessons learned. Um, and
because at the end of the day ,um, them performing well is
(25:30):
sort of, you know, rising tideraises all ships and so forth.
So , um, is there any advicethat you wish you had early on
when you were in some of thoseearly growth stages of those
tough years that , um, you ,you know, advice that you wish
you had gotten or, you know,lessons learned that you would
share with others that are inthat sort of smaller needing to
scale up phase?
Speaker 2 (25:52):
Well, I'll share a couple of of stories there,
but, but you're right, that isthe exact topic we're gonna be
covering Yeah . At the NICgrowth conference in, in
Indianapolis in in May. So Ithink it's gonna be a great
opportunity for a lot of those,you know, smaller operators to
come and learn from folks thatstarted with one and then went
(26:12):
to two and got to 10 or 20 or50, and, and sharing a lot of
those lessons learned along theway. And then we're gonna be
able to, I think, give folks alot of real world insight into
practical things they can bedoing , uh, on their growth
journey to get their businessesto, to scale and, and do so in
(26:35):
an efficient and, and, and, youknow, hopefully as low risk a
possible type of a type of amanner. So it's gonna be a
great discussion Yeah . InIndianapolis and very much
looking forward to sharing alot of those best practices in
the different areas we're gonnabe covering. Uh, whether it's
employee, you know, related ,uh, items, recruitment,
retention. Mm-hmm . How do weuse data to drive those things?
(26:56):
How do we reduce risk , uh,resident, how do we improve
health and wellness,value-based care? Mm-hmm
be happening at spring, Nick ,as well as at the growth
conference and wrappingancillary healthcare services
around the residents we're,we're serving every day. But
going back to the, the lessonslearned in advice , God , we,
we've been very blessed alongthe way. One of the unique
(27:20):
parts about the senior livingindustry is it's not like
McDonald's and Burger Kingacross the street from one
another, where they're justconstantly, you know, competing
and, and fighting it out.
Mm-hmm
staying in their home. Right .
So, to that end, you typicallysee an exceptional amount of,
of collaboration and sharingamongst the operators in the
(27:43):
space. Whether you go to ourGenum conference or Naasha
conference or ANIC conference,you see that on display. And
when outsiders come and join anorganization and show up at one
of these things, they literallycan't believe. What do you mean
you told your competitor, youknow, how to run their memory
care program, or you sharedthis technology insight with
them . It's, it's like aforeign concept to them. Um,
(28:06):
and , uh, I , if, if I could goback and tell myself, you know,
25 years ago , um, you know,some, some recommendations and
lessons learned, it would be donot be afraid to, to , to reach
out and, and tap your peers andhave those discussions. You'll
be surprised. They'll, they'llpick up the phone , uh, they'll
listen to you , uh, they'llbounce ideas off of you. I I
(28:29):
literally just did this with a, a guy I met at a charity
event a year ago who's got a 10unit, you know, memory care
community , uh, just west of,of, or east of Minneapolis. And
, and he called and they werehaving some recruitment and
retention issues. So we ideatedthrough it. It was 15, 20
minutes. Mm-hmm
I built a relationship. Whoknows, maybe something happens
(28:50):
between our two groups at somepoint, right. In the future.
But it's leveraged theresources that are there , uh,
that the trade groups have putforth. Uh, NIC has been a , a
leader there, or a gentleman'sbeen a , a leader there and ,
and reach out and, andcollaborate with, with your
peers. And we've benefited fromcountless thought leaders, you
know, in the space , uh, overthe years that have just shared
(29:13):
a tremendous amount of insightand intellectual property with
us that's helped us build ourorganization. And it's all been
in the spirit of we gotta getbetter together as an industry.
And if we do a really, reallygood job that's going to
mitigate the regulatorycomplexity and all of the
waters we need to, to navigatethere, it's kinda like a
(29:33):
self-policing , uh, mechanism.
But it's, it's reach out toyour peers and, and, and
collaborate. Um, and we did afair amount of that, but, you
know, I wish we would've donemore of it earlier on because
we've just learned so much ,uh, from our peers over the
years and it's helped us , uh,in immeasurable ways as we've
grown the organization.
Speaker 1 (29:53):
Yeah. And, and candidly, there's more now than
ever. So there's really not alack of, of, you know, a
network or resources. So , um,well, we appreciate you sharing
your thoughts with us, and, andI know the listeners , uh, will
as well again. Um ,
Speaker 2 (30:07):
And the way to do that is to come to the Growth
conference in May inIndianapolis
Wonderful . There'll be lots ofus operators there to rub
shoulders with. Yeah.
Speaker 1 (30:14):
Yeah. Indianapolis is great. Shameless
Speaker 2 (30:17):
Plug for the conference.
Speaker 1 (30:18):
Yeah, no, I, I, I'm very passionate about the
growth topic. 'cause I thinkthat there , there's smart
growth there . You know, peopleare very, again, open about
what has worked, what hasn'tworked, and, and this is sort
of the first
Speaker 2 (30:31):
Thing . If the company's not busy growing,
it's busy dying. And if youwant the best people, you need
to be growing because they wantto grow their careers. It , it
is so important and growing isfun, and it's exciting, it's
challenging, it's a lot of hardwork , um, right . But
downsizing is not fun,
(30:52):
more challenging. So point thatNorth Star and , and grow , uh,
that that'd be a nugget ofadvice to share with folks.
Speaker 1 (30:59):
I, I, I've stole this saying a number of years
ago. I heard it from somebodythat said, pick your hard .
Right. It's all hard. So like,you know, pick the hard that's
gonna move you in the positivedirection versus, you know,
stagnation and, and thealternative. Well, thank you
again, Ryan. Uh, you know,appreciate it and , um, look
forward to continuing , towatching your organization and
(31:19):
the great work that you'redoing. So thank you all , uh,
listeners to the Nic Chatspodcast, you can access , um,
certainly this edition of thepodcast as well as other Nic
chats podcasts on the NICwebsite is@www.nic.org . Thanks
for listening today.
Speaker 2 (31:36):
Thanks Lisa.
Appreciate it.
Speaker 1 (31:39):
That's it. Awesome.
Great conversation. I feel likeI could talk for hours, but
that was awesome. Reallyappreciate your time. I know
you're busy.
Speaker 2 (31:47):
My pleasure. So , okay . I'm gonna miss you next
week. So I'm up in Canada atone of my wife's , uh,
snowboard races, but , uh,Chris will be there talking on
the value-based care panel Yeah. With , with a few folks. So
definitely say hi to him and,and , um, Adam on my team. I
haven't met him yet, sittingright behind me. Uh , we'll be
out there as well, so be good .
Awesome .
Speaker 1 (32:06):
Well , good luck to your wife.
Speaker 2 (32:07):
Yep . Enjoy Sandy Diego . Appreciate it. Thanks .
Speaker 1 (32:10):
See Ryan. Bye .
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