• November 6, 2017

    Meet Mitchell “Mitch” Warren, chairman, CEO and co-owner of Irving, Texas-based The LaSalle Group. The family-owned and -operated company was founded in 1990 by Melvin W. Warren, “Win,” on LaSalle Street in Chicago. Several years later, in 2000, Win partnered with another family member to refocus the company on senior living, and Mitch joined shortly thereafter to help run the family business.

    Spotlight on Technology

    If you had a senior living executive dashboard you looked at every Monday morning, what would be on it?

    Great question. We do have a dashboard. You always want your typical financial and occupancy data, but I think the more interesting things to me right now are: How are retention and turnovers going with employees? And some broader sales stats, not just: What’s occupancy today? But what’s our tours trending, what’s our conversion ratios? Then how we’re doing operationally, our health statistics and those sorts of things. I think those can be more indicators as to where you’re going.

    Do you look at that dashboard a lot?

    I look at it the most of anyone. I’m trying to get more people to look at it. I probably don’t look at it once a week, but every couple of weeks. But I’m really trying to get our executive team to use it more.

    Today, The LaSalle Group is based in Irving, Texas, and works to design, develop, build and manage standalone memory care communities under the company’s Autumn Leaves brand. Currently, the company owns and operates 46 Autumn Leaves communities in Texas, Florida, Georgia, Kansas, Illinois, Missouri, Oklahoma, South Carolina, Tennessee and Wisconsin and continues to grow at a steady pace. The LaSalle Group is now one of the nation’s largest standalone memory care providers.

    We sat down with Mitch to learn about how he got into the family business, what he learned from firsthand family experience with senior living, and where he sees Autumn Leaves having a company advantage versus the competition.

    Tell me about how you got into senior living.

    I grew up in Lansing and went to the University of Michigan in Ann Arbor. I got into the business with my dad primarily, and other family members have joined since then. He had the business, The LaSalle Group, since 1990, and was doing a lot of real estate development. When I was getting out of school, another family member mentioned we should look at seniors housing, and it was a perfect opportunity for us to get into a business where we could help people. It just fit. It made a lot of sense.

    Did you know much about senior living at the time?

    Not too much. We had some tangential experiences. Pretty soon after that, my grandmother, Jean, got Alzheimer’s and we became acquainted with that quickly from a personal experience. That’s one of the reasons we were primarily focused on memory care, and we kept that focus. We moved from Michigan down to Texas — that’s where the company’s headquartered now —
    and opened the first community in Arlington. We started with one and have grown to 51.

    Going through the process with your grandmother, what did you learn about memory care?

    A whole lot. You can see just from the family experience with the community and the company experience—being in the business you see both sides. That’s unique. You can always talk to family members who haven’t gone through it and say that you know or have empathy for them. But when you’ve gone through it yourself, it definitely gives you a whole other perspective. Making decisions on what to do when, and where to go, and what type of care to get: What to look at, who to talk to, what questions to ask.

    Did that experience help you to shape what Autumn Leaves is today?

    Yes, for sure, in a lot of different ways. We’re always focused on the resident as a tenet, but it drives it home. Everything comes from there. We see that time and time again. You get tempted to focus on other things, financials just being one of the many. That doesn’t produce the results it does when you really focus on the resident. I expand it to people in general. Because we’re memory care, we’re dealing with the residents’ families a lot. Then, there are our team members. I say people is our main focus because it’s not just the resident. You really have to be focused, especially in this day and age, on the team members, too, and making sure you’re taking good care of them.

    I say people is our main focus because it’s not just the resident. You really have to be focused, especially in this day and age, on the team members, too, and making sure you’re taking good care of them.

    Tell me about when you opened your first memory care community. Were you nervous?

    Oh, yeah! Very much so. For me, I was nervous because it was my first job out of college. So was this what I wanted to do? Was it going to be successful? Did it really feel like we were going to be able to do something to help people? It turned out that the first one really was successful, and our most successful to date.

    Where was it?

    Arlington, Texas. Not only was it successful financially, but the community embraced it. There hadn’t been standalone memory care in that area yet. It was something new and unique and it really was embraced.

    Were there sleepless nights in getting it built?

    We had the typical nightmares with the contractor. On the second project the general contractor kind of left the job. On our third project we started our own GC firm, so we’re now a general contractor as well. We do design, development, general contracting, manage and represent the ownership. That’s also been something that’s been unique for us and that we’ve held as a differentiator, is that we’re in it from the beginning all the way through the close cycle—for the long term.

    Coming out of school in 2002, what made you want to join the family business?

    I had always talked to my dad about it and wanted to maybe have a stronger connection with him. He’d been in Chicago during my high school years starting the LaSalle business, so I wanted to reconnect and have a stronger bond with my dad. That was a big factor. I wanted to get out of Michigan, so this was an opportunity to get to Texas, to do something different. In college I had about three different majors before they finally let me out. I was exploring.

    Mitchell Warren, CEO, The LaSalle Group

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    What did he say when you came to him with the idea to get into memory care?

    He’s an entrepreneur at heart, so he definitely wanted to try it, but it also made a lot of sense. Again at the time, it was a high-need business, recession-proof so to speak, and financing was relatively easy. It just fit all the boxes.

    TECHNOLOGY

    We’ve started to see NIC data show signs of real occupancy pressure. How do you think operators get through this tough time?

    They’ve got to be true to what they’re all about. They’ve got to not ignore it. They need to recognize it.

    More from the Leadership Series

    Recognize what?

    That there really are major competition issues in certain markets. But they also have to have the NIC data, including the specific submarket data. The NIC data can say the whole country’s down, I don’t care. I care if it’s down in West San Antonio, where I have a community that’s hit with our competition. You’ve got to have your facts first. You’ve got to have your data. You’ve got to know what your competitors are doing. Then, have a systematic approach to what you’re going to do. Are you going to lower price? Stay true to your price and the service you provide, yet show that you can beat those competitors. Do you just wait it out? You have to have your strategy and be able to execute it.

    What about standalone memory care? Do you ever worry that it’s too hot?

    It’s been too hot in certain submarkets for a couple years now. I’d say we’re probably in year two.

    How much longer do you think it’ll last?

    I think we’re actually getting near the end for standalone. The good news is, we’re on the trailing edge of a downturn because it’s the most need-based. And then hopefully we’re on the leading edge coming out due to a couple of factors: The need is continuously growing. We haven’t hit the big numbers yet; that’s probably still five years out. But there’s such a need that when the competition does come in, the saturation happens more quickly. There are still a lot of combo buildings, so we feel that we’ve always been able to compete well against them. When you put 10 of them in the market, though, it’s going to take some time. I think we can become one the first out, one of the first that gets saturated. Where we’re building is a big factor. This is a big buzzword, but we’re looking for high-barrier-to-entry markets.

    But then why do you go to Texas? Texas isn’t high-barrier-to-entry.

    We went there originally, and we’re not building at all in Texas today, except for one property in Austin.

    What’s your pitch for standalone memory care if someone’s looking to put their mom into a community that has assisted living and memory care?

    First of all, we want the best place for their mom regardless of who it is. We just want them to have the best care and to make sure that it’s a fit for the resident. We believe, most of the time, a standalone memory care [facility] designed specifically both in terms of building and program [is best]. Our tagline is “Better memory care by design,” and the “by design” not only means the building design, but also the programming design and the individualized care. We believe that 90% of the time, someone who truly needs memory care is going to do better and live a better life in our community. Not only a standalone community, but one of these communities.

    Our tagline is “Better memory care by design,” and the “by design” not only means the building design, but also the programming design and the individualized care.

    Do you think the industry’s done a good job investing in technology up to this point?

    No, not great, and probably not as much as they could. Hotels have tried to get better, and they are probably a little ahead of us. Restaurants are probably behind us. I think people overlook that. I’m sure that’s a generational thing. Hopefully it changes.

    [Technology has] been a staple for our business. Innovation’s one of our four core values. We have a VP of technology and innovation. I’ve made sure that innovation remains part of that title. Everybody helps with innovation but [this person] helps us lead in that area. We’ve got a product development committee to look at our programming, product offerings and technology. They’re continuously trying to stay on the forefront—not only staying ahead of the competition, but also where we should be as an industry. But it’s expensive. That’s part of the issue. We’re not doing everything we’d like to do. We’re looking at a lot of things, but we’re not able to do them all.

    What types of technology is Autumn Leaves investing in right now?

    We’re [rolling out a new] EHR. We’ve got a proprietary assessment and medication management software that we’re going to transition to one of the full packages. We have a partnership with our nurse call and dementia monitoring system. We also have an exclusive agreement with OneDay [as a standalone memory care provider]. Their video storytelling app lets us use a mobile device to capture residents reminiscing or enjoying an activity. The app then generates a branded video on the fly that we can share with the family easily through email. It’s been really well received.

    There are a lot of [technology companies in the space]. Which is kind of interesting, [relative to your] original question. There are so many that want to get in this business. Are there too many?

    We’ve seen a big boom in ancillary services. Is Autumn Leaves operating in that space?

    A little bit. We run our own beauty salons in our communities, and we have an incontinence program that we partner on with another company. We’ve explored our own home health and hospice, but haven’t pulled the trigger on that. The last couple of years we’ve decided to kind of hunker down and re-focus, stick to our bread and butter, make sure we don’t get off track going too crazy. We haven’t invested as much into ancillary services, since we have good partners.

    What interested you in the home health space?

    We were actually looking at hospice first, although in some ways I’m actually more interested in home health. I think home health can be available to a broader swath of our clientele. If we can add home health to our standards, we can have better results for our residents.

    LEADERSHIP

    What’s your definition of leadership?

    Leadership is understanding who you’re leading, and listening, working with them, having vision, and hopefully helping your team execute.

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

    The last couple of years. For 15 years we could go pretty much anywhere, although we did a lot of research even during those times. But now are are being a lot more strategic about it. We are working with financial partners and capital partners more and in more creative ways. Capital used to be free-flowing for us.

    Do you think it’s been worthwhile?

    Definitely! To get through something like this, and to be stronger on the other side, we’re very happy with that. Even with the progress so far.

    Any sleepless nights the last couple of years?

    Worrisome sometimes. Sleepless from the standpoint [that] I have three young children, 5, 3 and 3 months.

    We have a tremendous team, and I depend on them for a lot. They’ve done a great job through this time, so I can rest assured.

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

    Starting this business. The original risk. There’s risk and fear when you don’t know what the competitors are doing. That’s been the biggest risk—I can’t control what someone’s doing that really doesn’t know what they’re doing. There are some reckless people.

    Do you see a lot of that?

    In standalone memory care, absolutely. Especially in Texas, anyone who thinks they can develop an apartment, and heard the buzzword “memory care” and tried to open up a memory care…Several of those companies have gone out of business. If someone’s going to open a memory care, we want them to be successful, they’re taking care of people. We want them to do well. I’m sure someone has picked them up.

    Have you looked at those opportunities?

    We haven’t really. Again, we want to just stick to our brand and what we’re doing. Our building design has been good to us, so we want to develop all of our communities at this point.

    You seem to be the guy who wants to keep the main thing the main thing.

    I like that. I think that’s been important. We’re kind of coming out the other end, and would also like some diversification.

    Assisted living or just sticking with memory care?

    Assisted, memory care, home health, hospice, acquiring, licensing our brand… there could be a lot of opportunities.

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

    My mother really taught me to listen well even when you think you’re right about something. Make sure you listen to the other side. That was good advice.

    My mother really taught me to listen well even when you think you’re right about something. Make sure you listen to the other side. That was good advice.

    Who would you consider to be your mentor and how have they helped your career?

    I’ve had several. My mother and father are both strong business people, and taught me a lot, and I have an uncle that’s a businessman so I’ve gotten a lot of advice just from watching him and the people I work with. The team I’ve helped put together are the experts in what they do in their areas. I hadn’t done any of this before. I learned while doing it. So I learn a lot from my team.

    Say I’m about to graduate college, what would be your pitch to me on why I should look to senior living as a career?

    Especially with a smaller group like ours, you’re just going to get a diverse experience. You’re going to get elements of finance, elements of asset management, development, design, construction, operations — and you’re doing something for a cause, you’re helping people. You really are. Yet it’s a business; you have to be profitable to continue. Part of our mission is if we are successful, that’s when we grow to new areas. You do get that opportunity to grow and have more people. With some of the larger senior companies, I think they get a little bit of everything. I think their pitch is more about having the passion to want to care for people, or ultimately help to lead that. I think for someone coming out of school, and this goes for us or them, is that the next five to 10 years [will boom, and] well, five years for someone just out of school is nothing. They think it’s a ton. Unfortunately, they won’t stay in that job for the five to really get the full benefit out of it. In five years, we won’t be able to build fast enough.

    Doesn’t that scare you a little bit though?

    It’s just balance.

    As a smaller company, how do you compete in hiring talent when you’re competing against the Brookdales?

    We can compete all day long. We’ve definitely got an advantage. It’s not just a small company; we’re a family business. We’re about the people, about the family feel, the culture. Our priority is all the people: the residents, the residents’ families, our team members. We just put all of our focus on that, make sure that’s really what we’re driving home. We’re hopefully competitive — I think our benefits package is really good, you’ve gotta get the data to figure out where you’re at with salary and all of that. We try to be as competitive there as possible. Then we look at advancement, and what we have to point to in terms of growth. That’s where our career advancement will happen. That will be the thing they sell against us, that they have more opportunity, or more stability. That one could be questionable. They’re going to talk about more opportunity, more jobs in the company … [but] we’re small. We an make sure that we develop their career path. We can have a closer eye on them.

    So what’s the biggest challenge the industry faces?

    I think it will be figuring out: Are we just going to grow gangbusters, or if there is a different model. How everything is going to shake out with ACOs, and those types of partnerships. I don’t think that’s all been figured out. There are a lot of unknowns, and that may be the biggest issue.

    What does the future of senior living look like?

    It’s positive. I really think it’s positive….We’re not out of the woods yet; there’s some tough times ahead. But again, five to 10 years looks really strong, if we can figure some of these issues out.