CEO Panel: Tough Economic Times Call for Return to Basics

by Jeff Shaw

PHILADELPHIA — As the dust settles from the COVID-19 pandemic, and complications such as inflation and higher interest rates continue to hurt the economy, now is the time for seniors housing owners and operators to focus on their fundamentals.

“We have to get back to business. That’s really our focus in 2023,” said Wendy Nowokunski, president of owner-operator Northbridge Cos. “Not that we ever lost sight of it, nor will we lose sight of the fact that our associates are our most important investment, but we really need to make sure we’re staying focused on the bottom line, NOI. We really need to keep a major focus on that in 2023 if we’re going to survive.”

Nowokunski’s comments came during a panel titled “The Power Panel: CEOs Discuss State of the Industry” at France Media’s InterFace Seniors Housing Northeast conference, held at the Sheraton Philadelphia Downtown in late November.

Sevy Petras, CEO and co-founder of Priority Life Care, moderated the panel, and made a point to focus on economics in general instead of the “hot” topics of recent years.

“We are not going to talk about COVID, technology or labor,” said Petras. “I think capital will be very happy to hear that we’re going to start using the word “NOI” again this year.”

Scott Stewart, founder and managing partner of private equity investor Capitol Seniors Housing, said his company put a dozen developments “on ice” until the economy recovers from the near-recession state it’s in today.

“We don’t know how long this is going to last — it will be well into 2023 at a minimum,” said Stewart. “Tough times don’t last but tough teams do. Those of us with gray around the temples, we’ve been through cycles before. We all know that this too shall pass.”

Stewart added that Capitol is currently in a hiring freeze, but that he issued a promise to his team that there would be no layoffs.

Richard Hutchinson, CEO of Discovery Senior Living, one of the largest operators in the country with approximately 15,000 units, said now is the time for setting goals, communicating them clearly and then sticking to them.

“It’s environmental — we will adapt,” he said. “It’s going to be a little different, but there will be accountability, there will be execution and we will perform. I don’t want to change my spots into stripes.”

Kelly Andress, founder and president of SageLife, said it’s been a few years of significant change for the company. SageLife opened three communities during COVID and spent 18 months getting away from third-party contracts to focus exclusively on properties where the company has an ownership stake. “If I say ‘last year’ I mean 2019, because 2020 had 30 months in it,” she joked.

However, she echoed the importance of consistency, fundamentals and goal setting, noting that “we have the resources to weather through this.”

“Usually I’m a little more collaborative and little more patient,” she said. “This year we set the goal and we got feedback. For Round II, you’re either on the bus or you’re not. We have real business goals we have to hit.”

— Jeff Shaw

You may also like