The largest organizations in the seniors housing industry expanded their capacity modestly between 1999 and 2000, in part because of both constrained availability of capital and an enhanced focus on current residences in operation. More than three-fourths (92%) of the organizations appearing on the 2000 ASHA 25 ownership and management rankings were previously ranked, with only three companies newly included in 2000.
Seniors Housing Owners The Leaders. For the seventh consecutive year, Colson & Colson/Holiday Retirement Corp. topped the list of largest seniors housing owners, with a domestic portfolio of 27,427 units in 229 properties. Although Colson & Colson/Holiday Retirement Corp. continues its steady international expansion, the privately held company also added 13 properties and 1,452 units to its U.S. holdings between July 1999 and June 2000. The company has increased its portfolio of owned U.S. properties by 86% since publication of the inaugural ASHA 25 in 1994.For the second year in a row, Alterra Healthca re Corp., a publicly traded company with an ownership portfolio of 21,119 units in 453 properties, ranked second among ASHA 25 owner firms. Since last year, Alterra added 4,684 units (more than 16,000 units since 1997) to its owned portfolio, the largest such increase of any firm in this year's owners list. Nationwide Health Properties, a real estate investment trust (REIT) based in Newport Beach, Calif., moves from No. 4 in 1999 to No. 3 this year with an ownership portfolio of 11,529 units in 128 properties.
Since 1995, the ASHA 25 ownership rankings have included several health care REITs. In 2000, this trend continues, as 20% of the list are health care REITs, including Nationwide Health Properties (3rd), Health Care REIT (6th), Health Care Property Investors (9th), Meditrust Corp. (15th) and Senior Housing Properties Trust (formerly known as HRPT Properties Trust) (22nd).
Ownership Status. Another trend in this year's ASHA 25 is the continued presence of publicly owned seniors housing firms. Almost half (48%) of the ASHA 25 owners are public entities, and 60% of the 10 largest owners are publicly traded. Public companies include Alterra; Nationwide Health Properties, Inc.; Health Care REIT; Sunrise Assisted Living; Crestline Capital Corp.; Health Care Property Investors; American Retirement Corp.; Assisted Living Concepts; Grand Court Lifestyles; Meditrust; Marriott Senior Living Services; and Senior Housing Properties Trust.
For-profit, privately held seniors housing owners comprise another 36% of ASHA 25 owners and include Colson & Colson/Holiday Retirement Corp.; Atria; Senior Lifestyle Corp.; Classic Residence by Hyatt/Encore Senior Living; Merrill Gardens; First Centrum; Leisure Care; The Fountains; and Simpson Housing Solutions.
The remaining ASHA 25 owners (16%) are not-for-profit organizations, including ACTS Retirement-Life Communities, Inc.; Covenant Retirement Communities; National Benevolent Association; and Retirement Housing Foundation. The presence of not-for-profit companies in the ASHA 25 has declined from a high of 32% in 1994, although it should be noted that a number of not-for-profit organizations are involved in Section 202 elderly housing, which is not included in the ASHA 25 rankings.
The Newcomers. Only two companies broke into the ASHA 25 owners list this year: Merrill Gardens, LLC (17th), based in Seattle, and Simpson Housing Solutions, LLC (formerly known as Kaufman and Broad Multihousing) (24th), based in Long Beach, Calif.
Stability is also a characteristic of the leadership among ASHA 25 firms with all but three firms with the same Chief Executive Officers as in 1999. New CEOs in 2000 include Mark Ticotin at Atria, Inc.; Michael F. Bushee at Meditrust; and Jeff Ferguson at Marriott Senior Living Services.
Ownership Growth Profile In the aggregate, the ASHA 25 owner portfolio grew by 3.9% between 1999 and 2000 - the same rate of growth that occurred between 1998 and 1999. Despite this year's modest growth, the combined portfolio holdings of ASHA 25 firms have grown by 122% since 1994. Growth within the largest 10 owners was 4.2% between 1999 and 2000, and 123% since the first ASHA 25 ranking.
The total number of units within the ASHA 25 ownership portfolio has more than doubled in the past seven years, from 87,705 units in 1994 to 194,478 units in 2000. The mean portfolio size of ASHA 25 owners has also more than doubled since the first ASHA 25 ranking was compiled, from 3,508 units in 1994 to 7,779 units currently. The minimum threshold for inclusion in the ASHA 25 owners list has grown 78.8% in the past seven years, from 1,963 units in 1994 to 3,510 in the 2000 list.
Seniors Housing Managers The Leaders. Colson & Colson/Holiday Retirement Corp. also tops the list of largest seniors housing managers, with a managed portfolio of 27,852 units in 233 properties. Colson & Colson/Holiday Retirement Corp. has been the largest U.S. seniors housing manager in every year the ASHA 25 has been compiled.
Marriott Senior Living Services remained at the No. 2 spot in the ASHA 25 managers roster with 25,100 units in 149 properties under management. Between 1999 and 2000, Marriott increased its managed portfolio by 11% (2,417 units in 21 properties). Professional Community Management is again No. 3 in the ASHA 25 managers list with 22,864 managed units in nine properties.
Moving up to No. 4 in 2000 from No. 5 in 1999 is Alterra, which manages 21,719 units in 470 properties. Alterra experienced the largest expansion of managed units between 1999 and 2000 (among firms ranked in both years), with an increase of 4,768 units in 81 properties in its managed portfolio.
Management Status. More than half (52%) of this year's ASHA 25 managers list are privately held companies, which is similar to previous years. Those companies include Colson & Colson/Holiday Retirement Corp.; Professional Community Management; Life Care Services, LLC; Senior Lifestyle Corp.; Atria; Classic Residence by Hyatt/Encore Senior Living; Erickson Retirement Communities; Greystone Communities; Merrill Gardens; Leisure Care; The Fountains; and American Lifestyles. This year's ASHA 25 managers roster includes just one not-for-profit seniors housing organization, ACTS Retirement-Life Communities, Inc. (15th).
Newcomers. As with the ASHA 25 owners list, the vast majority (92%) of firms appearing in this year's ASHA 25 management list appeared in the 1999 rankings. Newcomers include Merrill Gardens, LLC (17th) and American Lifestyles, Inc. (25th), based in Cleveland, Tenn.
Management Growth Profile The management portfolio of the ASHA 25 paints a picture of steady growth between 1999 and 2000. The top 10 firms managed portfolios in 2000 that are 8% larger than the previous year, while the total ASHA 25 management portfolio grew by 6.2%.
The total number of units within the ASHA 25 management portfolio increased 6.2% from 242,105 units in 1999 to 257,162 units in 2000. Since 1994, the number of units managed by the ASHA 25 managers has more than doubled (123%), from the 115,125 units in the inaugural ASHA 25 ranking. The mean management portfolio size of ASHA 25 companies has increased from 4,605 units in 1994 to 10,286 in 2000. The minimum threshold for inclusion in the ASHA 25 managers list has grown 40.1% in the past seven years, from 2,423 units in 1994 to 3,394 in 2000.
Specialists. Fourteen firms appear on both the ASHA 25 owners list and the ASHA 25 managers ranking. Nationwide Health Properties, Inc.; Health Care REIT; Crestline Capital Corp.; and Health Care Property Investors, Inc., are among the 10 largest owners that do not manage. Professional Community Management; Life Care Services, LLC and Emeritus Corp. are among the largest 10 managers but do not qualify for the ASHA 25 ownership list.
Mary G. Leary Chief Operating Officer Classic Residence by Hyatt With properties in Florida, Texas, Maryland, California and other states, Classic Residence has built exceptional senior living centers based on the successful Hyatt model.
Since joining Classic Residence by Hyatt in 1990, Mary has helped the communities to achieve high levels of residence satisfaction. Classic Residence has received numerous industry awards and achieved a consistently high occupancy rate.
"There is a higher expectation of quality associated with the Hyatt name," she says. "It's a lot of work for us to live up to that challenge."
Mary is responsible for day-to-day operations and marketing of all Classic Residence by Hyatt communities. Under her leadership, Classic Residence has implemented many new programs and services nationwide. Over the past 10 years, the properties have evolved from merely serving as rental apartments to include options such as assisted living and skilled nursing.
The residences also have begun to include programs on fitness and wellness through spa and exercise facilities. In recent years, the company added a "flavor enhancement" program to improve the meals served at Classic Residences.
A graduate of Cornell University with a master's degree from Harvard University, Mary serves on the board of directors for the Assisted Living Feder ation of America, as well as ASHA. Prior to joining Classic Residence, she served as president of StratMark, Inc., vice president at Oxford Retirement Services and as a strategic planning consultant with American Medical International, Inc.
David J. Freshwater Chief Executive Officer The Fountains Ever since he and his brother started a garage band in junior high school, David has been a consummate entrepreneur. With degrees in environmental design and real estate finance, he experimented with several start-up companies in the 1980s and found his niche in seniors housing in 1986.
Based in Tucson, Ariz., Fountains Continuum of Care, Inc. ("The Fountains") is engaged in development, acquisition, ownership and management of a variety of companies that provide housing, hospitality and healthcare to mature adults. The affiliated businesses include retirement communities, nursing homes, home health care agencies, management and marketing services, and real estate brokerage.
David has established unique philosophies regarding resident care. For example, in early 1997, he implemented "Edenization," a strategy to eliminate the plagues of loneliness, helplessness and boredom among residents by integrating a natural environment (including plants, pets and children) with resident-centered care. He also provided financial incentives for all Fountains assisted living and health centers to adopt the strategy.
To determine additional specialized healthcare needs, in 1994, the company commissioned a study by the University of Arizona College of Architecture. The study resulted in the development of residential/social-model Alzheimer's care homes (called The Gardens) under the Arizona Model, a pilot study of innovative Alzheimer's care environments. Through the pilot program, the Arizona Legislature is studying quality of life outcomes of The Gardens and other selected programs, in preparing to formulate licensing/service standards for this presently self-regulated industry. The Fountains currently has six Gardens campuses in full operation and is planning additional facilities.
David has been a member of ASHA since 1992. He is a graduate of Miami University in Ohio, and he received a master's degree from the University of Arizona.
Michael Medzigian President and CEO of Lazard Freres Real Estate Investors(LFREI); Managing Director of Lazard; Chairman and Director of Atria, Inc. A graduate of Cornell University, Michael has worked for LFREI since 1999. LFREI is the general partner of four private real estate funds, sponsored by private investment bank Lazard, which have invested nearly $3 billion of equity capital since 1994. The LFREI funds hold interests in 14 real estate operating companies with more than $7 billion in total assets.
Michael also is a director of American Apartment Communities, the American Seniors Housing Association, the Assisted Living Federation of America, Dermody Properties, iStar Financial Inc. and The Rubenstein Co.
Prior to joining LFREI, Michael was a founding partner of Olympus Real Estate Corp., a real estate investment organization affiliated with Hicks, Muse, Tate and Furst. Previously, he served as president of Cohen Realty Services, a Chicago-based real estate investment services firm; he also founded the Hospitality Consulting Practice at Deloitte & Touche and served as its national director.
Michael is a member of the Cornell Hotel Society; the Cornell Real Estate Council; the National Multi Housing Council; the New York Hospitality Council, Inc.; the Pension Real Estate Association; the Urban Land Institute; and the Young President's Organization.
Jeff Ferguson Executive Vice President Marriott Senior Living Services As executive vice president of Marriott Senior Living Services, Washington, D.C., a division of Marriott International Inc., Jeff Ferguson oversees more than 16,000 associates and the operations of 149 senior living communities nationwide.
Jeff joined Marriott in January as the division's senior vice president, chief operating officer. He was named executive vice president in June.
Prior to joining Marriott Senior Living Services, Jeff spent 15 years with HRC-ManorCare Corp., the last six years as vice president and general manager of the Midwest Division, where he was responsible for 67 senior centers. He was on the Northwest Ohio Alzheimer's Association board of trustees for six years and served as president in 1997-1998. He also was on the Health Care Association of Michigan's board of directors from 1995-1999.
Jeff, who earned his undergraduate degree at Lafayette College, received a master's degree in urban studies from the University of Akron and a master's degree in business administration from the Wharton School at the University of Pennsylvania. He earned a doctorate in management from the Weatherhead School of Management at Case Western Reserve University.
In addition to independent full service communities, Marriott Senior Living Services offers assisted living communities for seniors who need help with daily activities, such as bathing, dressing and medication reminders. Marriott also offers special care centers for residents with Alzheimer's Disease and other memory-related disorders.
Bruce Andrews President and CEO Nationwide Health Properties Bruce Andrews has served as president and CEO of Nationwide Health Properties, Inc., since September 1989. Based in Newport Beach, Calif., the company specializes in investment and financing of healthcare facilities across the nation.
Nationwide Health Properties owns 290 healthcare facilities, which are leased to healthcare operators, and has investments in more than 340 healthcare facilities in 37 states. Those include skilled nursing facilities, assisted living facilities and continuing care retirement communities. Its properties include Homewood Residence in Naples, Fla.; and Sterling House in Brighton, Colo., a joint project with Alterra Healthcare Corp.
Prior to joining Nationwide, Bruce served as chief financial officer, chief operating officer and director of American Medical International, Inc. (AMI), from 1970 to 1986. During that time, AMI grew from $39 million to $4 billion in revenues and expanded into the acute care hospital field and other healthcare operations. He previously worked in mergers and acquisitions at Arthur Andersen & Co. for eight years.
Bruce has been a member of the House of Delegates of the American Hospital Association, and a vice president and director of the Federation of American Hospitals. Currently, he is a director of Center Trust Retail Properties, Inc.
He is a graduate of Arizona State University.
David Dwight President Covenant Retirement Communities Over the past 20 years, David Dwight has seen first-hand all the qualities that have made Covenant Retirement Communities a success for 113 years. What began as a single seniors community in 1886 now provides a home for more than 4,500 residents.
David began his career with Covenant as assistant administrator and served as campus administrator, assistant vice president and vice president before he was named president in 1997.
Having worked for the Lutheran Home and Services for the Aged in Arlington Heights, Ill., David saw a natural progression in moving to Covenant, a not-for-profit ministry of the Evangelical Covenant Church.
Headquartered in Chicago, the communities provide a home, as well as rehabilitative care and long-term skilled nursing care. The company operates 14 retirement communities in Connecticut, Florida, Illinois, Minnesota, Colorado, Washington and California.
In addition to working with ASHA, David is a member of the American Association of Homes and Services for the Aging and the Life Services Network of Illinois. He also works with the Continuing Care Accreditation Commission. He received his undergraduate degree from North Park University in Chicago, a master's degree from the University of Illinois and a master's degree from Loyola University of Chicago.
Charles Wright Chairman R.D. Merrill Co. Charles Wright has served as chairman of the R.D. Merrill Co. since 1994, overseeing the company's diversified operations.
Prior to joining the family business, he was executive director of Dia Center for the Arts in New York, a diversified cultural institution with museum operations in several states and an asset base in excess of $150 million. From 1981 to 1986, he practiced law with the Seattle firm of Hillis, Clark, Martin & Peterson, focusing on corporate securities work.
Charles graduated from Princeton University in 1977 and received a J.D. from the Stanford University School of Law in 1981.
Over the past seven years, Charles has directed Merrill Co. to focus on the growth of Merrill Gardens, which now includes 58 communities and more than 5,400 apartment units in 14 states.
The majority of Merrill Gardens' residents are independent seniors over the age of 80; however, the company offers assisted living services and specialty Alzheimer's care services to seniors in each of its communities. Approximately 30% of residents receive some form of assistance with basic needs such as medication, bathing and dressing.