Your Community is Sold—Should You Be Concerned?

What most people don’t realize about the senior living industry is its similarity to Monopoly: buying, selling and improving properties is all part of the game to remain profitable while delivering a safe and supportive setting for seniors.

But what happens to the residents and their families who are caught between these business transactions? After a lifetime of home ownership, it might seem unnerving to realize your loved one’s home can be sold so easily. And you will likely fear the worst—beloved staff members losing their jobs or a community change for the worst.

Sold SignWe decided to shed some light on this issue by asking several senior living companies to discuss their approach to purchasing communities and how they work with residents during the transition. What they shared reveals that a management transition can, if handled properly, be a welcome change and provide a better quality of life for your loved one.

Greenfield Senior Living

For Greenfield Senior Living, a Virginia-based senior living provider, a community’s existing culture supersedes other metrics when considering the acquisition of a community. Greenfield is a “customer-centric” company with a focus on culture, says Jonathan Barbieri, vice president of marketing for Greenfield Senior Living. “Can the culture we bring improve, enhance and brighten the community?” With a focus on the senior, Barbieri says, “we want people to say ‘Wow’” after seeing how a Greenfield community treats its residents.

The purchase negotiation determines how soon a Greenfield management team is on site to work with existing staff for the transition. Sometimes Greenfield may not be on site until the actual close, Barbieri says, adding they like to be there as early as able to develop a relationship. Developing this relationship involves introducing the new team to Greenfield’s vision of the industry. “We really want people to walk away from the meeting saying, ‘This group of people cares,’” Barbieri explains.

After meeting with staff, the Greenfield management team meets with the residents and their families. Barbieri says the exact introduction depends on the care levels offered at the community, but it generally includes a presentation of Greenfield’s operating philosophy and a question-and-answer session to create “open and transparent dialogue.”

One question frequently asked is whether there will be staff turnover. Barbieri says Greenfield’s approach is to support the staff because “the last thing you should be doing is turning people over.” Another concern is whether rent will increase, which Barbieri explains is already baked into the acquisition, adding that Greenfield “doesn’t want anyone to leave the community due to a price increase.” Sometimes new leases are issued because some states require issuing a new lease following the purchase of a community, but in those cases, the previous lease is still honored.

As far as community life is concerned, Barbieri says residents should only see improvements after a sale. “We want each community to be its own cruise ship, offering as much as you can possibly offer … by offering more we can engage our residents,” Barbieri says.

“Seniors know what they want,” Barbieri adds. “We get very good feedback about the resource we bring.”

MBK Senior Living

Robin Craig, corporate director of marketing for MBK Senior Living, explains in basic terms her company’s approach after acquiring a new community:  “Add value in the way we manage. … We place a value on creating a comfortable, well maintained contemporary community setting.”

Part of the decision to acquire a new community is based upon whether the culture and management is similar to MBK’s. Craig explains that the management team does due diligence in assessing the community and knowing who is managing the building before a contract is signed. That contract, and/or state regulations, determines whether residents know in advance that their community is being purchased by MBK, and Craig says that former owners may announce the transition before MBK is on site.MBK Senior Living - Logo

Once on site, the first step is making the associates comfortable with MBK’s management because “The associates are the voices the residents hear,” Craig says. “We try to not make changes when coming in.” After associates have been oriented to the new MBK management team, the transition is announced to residents.

Residents can expect to have their questions and concerned listened to and addressed. Craig says they invite family members to attend the presentations and the management team is available for questions. In her experience, families are more concerned about the details of the pricing than learning more about MBK. The company is honest about future rent increases, Craig says, and strives to create a comfortable situation for those discussions. She also assures residents and families that following an MBK acquisition that things are on equal footing or better. “Because we are owner-manager, we feel that is a better scenario for the family.”

One of the changes residents may see right away is more choices for care, and their beloved caregivers will likely be on staff. “As much as we can appropriately keep the associates there, we will,” Craig says. There may also be more food choices and activities, because “typically we don’t take things away.”

For MBK COO Daniel Morgan, communication is crucial to a successful management change. “Change is difficult for people no matter the age,” Morgan said via email. “The key to our success has been to effectively communicate that change is coming, what the change will be, the reason why the change will occur and when the change will occur. … If for any reason we are unable to fulfill any part of what has already been communicated regarding the change, it is important to get back in front of the residents with updates.”

Senior Lifestyle Corporation

Within two months of acquiring a community, the new Senior Lifestyle management team holds a Family Night with residents, their families and staff to share the life story of Senior Lifestyle. But it’s meeting every person that Tim Marzec, vice president of operations-community integration, says residents particularly appreciate. “I just can’t say enough about the reception we [receive], with some residents saying we’re the first person to come and visit us.” The residents “want to know you as a person.”

Among the criteria Senior Lifestyle uses to determine acquiring a community is how it “fits within how our company operates,” Marzec says. In his role, Marzec is charged with integrating the new community’s staff into Senior Lifestyle’s business systems, whether it is navigating the payroll system or who to contact when needing a question answered.

Once Senior LIfestyle receives approval to enter an acquired community, it meets with the employees to discuss the community change, sharing who the company is and what to expect in the coming months, Marzec explains. Once a community is acquired, Marzec says he is among the first of the Senior Lifestyle management team that the staff members meet. Marzec says the first 60 days of a transition are spent simply observing the community, and “we try to be very mindful that it’s a pretty big change [with the community being purchased]”

One of the questions Marzec frequently answers is what will happen to the staff. He says it’s in the company’s best interest to retain good employees, as they are the backbone of any community.

Residents usually don’t see a change until 90 days into Senior Lifestyle’s ownership, at which point, they might see changes in the menu or a reformatting of the activity program. For pricing, the billing statement might look different, and a new residency agreement is updated. “Generally all the pricing stays the same” and care levels remain consistent, though there might be a reassessing of the care plan, Marzec says.

During Marzec’s tenure in this Senior Lifestyle role, “I’ve found in the beginning a lot of people are nervous. … Once they get to you know and … once they see that you’re here to help, I have found the reception warm and welcoming.”

Final Thoughts

If it is news to you that retirement communities are bought and sold so easily, you’re not alone. Craig says that in her experience, residents “think of just that community, not the companies behind it.” And thinking that only large communities are acquired isn’t true. Sometimes, family-owned communities are sold to a larger company, or a community is spun off from a large company to become independently-owned and managed. Further complicating the matter is that sometimes the company that owns a community isn’t the same company that manages it.

So what can you do if your loved one is at a community that is recently purchased? Because contract negotiations are confidential (and if you are in a state that doesn’t require advance notice of a sale), you might not know the community is sold until after the transaction is finalized. Attending the community-wide introduction is important so you can ask questions about what the change in management means for your loved one’s lifestyle. Your state’s laws will determine whether your loved one receives a new lease—if so, you should review it to determine whether the existing lease is being honored or if there is a change in pricing. State regulations often specify that you should receive advance notice of rate increases, and if a community fails to follow that statute, it can be cited.

Written by SeniorHomes.com’s Andrea Watts

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