This story is part of your SHN+ subscription. Alignment between owners and operators of senior living communities is increasingly important, but not always easy to achieve. Senior living real estate investment trusts (REITs) like Ventas (NYSE: VTR) and Welltower (NYSE: WELL) advocate for better alignment, as maximizing occupancy and margins today can lead to significant net operating income growth.
In the past, the relationship between owners and operators was one-sided, but companies like Ventas now believe owners have a more active role to play. They provide insights to help operators achieve desired results. Evolve Senior Living, a new operator, emphasizes collaboration with owners to improve community performance through information sharing and efficiencies.
12 Oaks President Greg Puklicz highlights the importance of alignment without sacrificing control over business practices, focusing on shared business plans, goals, and incentives. Ventas’ operational insights program promotes collaboration by sharing real-time information with operators to drive better outcomes.
Evolve Senior Living uses Evolve Intelligence to share data with ownership groups to improve performance. Coastwood emphasizes alignment among all stakeholders, including capital partners, recognizing the value of quality operations. Balancing alignment with maintaining business practices is essential, as operators like 12 Oaks prioritize respect and trust in relationships.
Looking ahead, alignment will continue to be a priority for senior living operators and owners. The industry is moving towards better relationships that prioritize alignment, leading to improved performance and outcomes. Regional operators like 12 Oaks will play a crucial role in promoting aligned management structures for continued success in the industry.
