These assets seem like they are very expensive right now.

I think it’s very much a seller’s market. If you look at national numbers it seems like the market is softening but at least in the markets where we are looking it’s still pretty expensive.

Have you had to walk away from a lot of deals?

We’ve turned away a good handful in the year that I’ve been here, yes, either because it was the wrong location, the wrong fit, it wasn’t the right type of building or the right value-add opportunity. But again, we’ve been busy with the acquisitions we have.

This isn’t just a real estate business, it’s an operations business.

Do you think there are enough operators out there?

I think ultimately there are so many, including little mom and pops that manage one or two properties, but I think there are plenty of operators out there and I think we’ll see some consolidation as time goes on.

Everybody keeps talking about consolidation, but it really hasn’t happened yet.

I’m with you. There’s been talk about it for years and years, and I think it’s going to be a slow process, but I think for a lot of the smaller operators for whom it’s very costly to do business, the right offering price will come in and they’ll sell. It’s not going to happen overnight, and you’re not going to just all of a sudden see two or three operators own the world, but I think it will pare down to some degree.

With the value-add opportunities, what specific value are you looking to add?

It can come from many different perspectives. Maybe there’s a value-add from a management perspective where the building was poorly run or maybe you can convert part of the building from independent living to assisted living or assisted living to memory care. You make a transition in the neighborhoods themselves, or maybe you do an addition to the building to add more units. There’s a variety of ways that value-add may come in and you just have to evaluate all these different things.

TECHNOLOGY

Why do you think you’ve been behind in terms of technology adoption?

I just think it’s a sign of the times. You don’t want to be the first one into the space and jump into something that’s unproven. You want to make sure if you are going to invest significant dollars and time bringing in a new platform, that it works and it’s right for your business. There’s just a lot of trust that you’re going to build up with that software company or provider to make sure that they are offering what’s going to work for you.

What types of technology?

Everything from electronic health records to table-side dining ordering — everything that makes the operation more technologically advanced and efficient so that it cuts down on the amount of paperwork and duplicative entries in our systems.

You’ve brought up the words “health care.” Do you see MBK as a health care company?

Jeff: That’s a great question. In most states we’re considered residential facilities, and it’s a really slippery slope, because we’re considered residential. But people don’t come here just to live. They’re coming because it’s need-based, whether they have care needs or socialization needs or whatever. They are coming for a reason, and you are providing care.

“…people don’t come here just to live. They’re coming because it’s need-based, whether they have care needs or socialization needs or whatever. They are coming for a reason, and you are providing care.”

We are taking care of a high acuity resident, and you have to have good technology to individualize that resident’s needs.

Is MBK bringing in outside care or are you providing it yourselves?

We provide it ourselves. There are always residents who will bring in home health or other private services or whatever the case may be.

Do you see home health as an opportunity to build those health care services?

Nothing is off the table, but it’s certainly not a focus for us right now. We just want to continue to grow our platform and acquire the right buildings. When the time is right, maybe we’ll look at other other business channels. But we’re leaving that to the experts right now.

In terms of acquiring new buildings and tough pricing for buyers, how much more pain do you think there is yet to come?

I firmly believe that it’s still a couple of years. I think there will be continued downward pressure on occupancy and rates we can charge.

I think both of those will cause a lot of pressure in the next couple of years. Eventually as some of these different developers moving into the space either filter back out or some consolidations happens, I think it will ease up, but I think we’re still looking at a couple of years.

When MBK does a turnaround project, what is the biggest challenge?

It all depends on the market. In some markets, staffing is absolutely the critical piece. [The industry is concerned about] staffing challenges, wage rate pressures, lack of talent in the industry plus the number of jobs moving into the space in the coming years. It’s just going to cause that much more pressure.

It’s a big focus for us right now, trying to groom our own ‘farm system.’ We’re working to provide training internally and groom people to be ready as we acquire buildings.

Do you think you’re well placed to do that given your history of rising through the ranks in senior living?

We have limited resources as every company does, but we want to try to put a lot of focus on keeping our turnover low so that we can offer those advancements and training opportunities and help people feel good about where they are. We have to be ready to go.

With respect to the staffing crisis, how much of it really just based on how jobs are paying?

Pay is always an issue. We’ve done wage increases in multiple locations over the last year just because they’ve been in challenging markets. More than anything, I think it’s the lack of talent in the industry. I talk to our internal recruiting team almost daily and ask them to be very creative—asking them to try to find different segments or populations we can attract into the space, because that’s going to be key for us over the years.

What are some of the creative ways you can attract that talent?

Looking at different segments of the population, whether it’s younger millennials coming out of school, or semi-retired folks looking for something to supplement their retirement. We are trying to attract people who may never have thought about senior living as an opportunity.

LEADERSHIP

What’s your definition of leadership?

One of the key aspects is being a good listener. Listening to the needs and desires of your teams. To me, the most successful leaders work tirelessly and focus on putting a team together. They put their egos aside and focus on the customer. At the end of the day our residents and their families are the customers. We put them at the forefront. Sometimes you have to forego a dollar today to do the right thing. It pays off in the long run.

During your senior housing career, what’s the biggest challenge you faced?

Talent. Of all the years I’ve been doing this it always comes back to the basic blocking and tackling in the industry. There’s no secret sauce. It’s finding the right people and the right talent and grooming them so that you’re working for some common goals. It’s always about the people in this industry.

For 20 years you’ve been working on the same problem. Have you found any solution?

I think I’ve personally gotten better. It’s an endless quest to find good talent, to provide good training and groom them for what you expect. I personally, as well as the companies I’ve worked for, have very, very high expectations. Even if there is a lack of talent, we’ll struggle to find the right people.

Sounds like you hit those dead ends along the way, but you managed to keep finding your way through. Is that a challenge still?

Not really. I think there’s plenty of  opportunity in the industry. If you have the drive, and the determination and the passion for it, I think there are opportunities there. I worked for a couple of companies over the years that weren’t the right fit for me from an ethics standpoint or an integrity standpoint, but in finding this role, we spent a lot of time talking about the culture and what’s important. There’s ample opportunity but you have to put yourself in the right position.

What’s the biggest risk you’ve taken in your career?

I think the biggest risk was moving to California after spending my whole life on the East Coast, and going from an operations perspective into acquisitions, where I had no experience.

What’s the best piece of advice you’ve received in your career?

I think the best piece of advice is always having a plan B and making sure that you keep your goals ahead of you. Always have an option to turn to so you’re not locked into one thing. If and when that fails you don’t want to be left without a plan B.

I think the best piece of advice is always having a plan B and making sure that you keep your goals ahead of you. Always have an option to turn to so you’re not locked into one thing. If and when that fails you don’t want to be left without a plan B.

Whom do you consider to be your mentor?

Probably my greatest mentors were a COO, Carl Johnson is his name, and my second was Sue Farrow, who owns Integral Senior Living. I worked with both over the years and learned from them about leadership and what to focus on, and how to grow the right business within senior living. The way they handle themselves and the way they treat people was great insight to me in how I’ve modeled my career.

When do you think the industry starts to figure out how to overcome the current challenges?

Two to three years would be my guess. I still think there’s a lot of development going on — it slowed to some degree and then it picked back up. It’s coming in small waves. I think in two to three years some of this will stabilize and some of the units that have been built will be absorbed.

Last question. If there was an executive director like you were back when you started, what advice would you give that person?

I wouldn’t have hired myself 20 years ago. I had no experience! But I’m amazed sometimes, looking back on how I got the job. I would tell that ED to put in his time. Make sure to read a lot. Make sure to listen, more than anything. Attend to regulatory updates. Stay in tune with the business. Go to conferences and learn the comings and goings of the industry, and just be diligently focused on their residents and their business at hand.