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Since partnering with Discovery Senior Living, the past nine months have been a whirlwind of both integration and growth for Integral Senior Living — just ask CEO and President Collette Gray.
“A lot has happened in the last nine months,” Gray said recently during an interview with Senior Housing News on the sidelines of the Senior Living 100 Conference in Laguna Niguel, California. “We have been able to take the best of ISL and the best of Discovery and bring them together to create something truly unique.”
By joining the Discovery Senior Living umbrella, Integral – also known as ISL – has gained access to support functions that have helped bring its business capabilities to a new level and have served as a “game-changer,” Gray said.
While creating change is difficult, Gray said the arrangement with Discovery and the Bonita Springs, Florida-based operator’s corporate support center has shifted the burden away from communities and led to better care outcomes and staffing efficiency.
ISL also has access to an on-call legal team via Discovery’s support center that can assist when needed, something the company didn’t have before, Gray added.
“Together we are one family,” Gray said. “We have more robust tools to help us make decisions that ultimately drive better results and outcomes for our owners.”
The partnership between ISL and Discovery was announced until early February 2023 following an investment by Lee Equity Partners and Coastwood Senior Housing Partners into Discovery. That transaction was completed in June of last year. The result created the nation’s fifth largest senior housing operator, and also followed a recapitalization of Discovery Senior Living by Coastwood in October of 2022.
The recapitalization added fuel to the fire for Discovery’s horizontal growth strategy, and in August of last year, resulted in the launch of LakeHouse Senior Living, a new regional management company aimed at growing the brand’s presence in the Midwest.
Scale, support from Discovery a ‘game-changer’ for ISL
Now Discovery’s largest, vertically integrated senior living operator, ISL exists within the Discovery family of companies, with ISL having management of over 113 communities.
ISL is continuing to grow its brand across its footprints in 24 states. As president and CEO of ISL, Gray continues to lead the Carlsbad, California-based organization while also sitting on the Discovery Senior Living board of trustees.
As a result of the integration, some ISL teams have been elevated to the corporate level to support communities outside of the ISL portfolio, with an in-house recruitment team now providing insights to communities for Discovery and beyond, Gray said.
“We’re taking the good things that are happening from both companies and building them out and growing them so our support services platform is robust and I would say it’s one of the biggest things to have happened as a result of this transaction,” Gray told SHN.
The new support has been a “game changer” for ISL’s operations, specifically for HR-related tasks, Gray said. The company has improved employee retention and recruitment by enacting an improved 401(k) program for staff with an employer match.
“As we are growing and as we are bringing all of those things into the parent company, our staff can focus on the day-to-day and deliver the resident experience and drive results,” Gray said.
On Monday, Gray confirmed that long-time Brookdale Senior Living (NYSE: BKD) executive Laura Fischer has started in her new role as COO for ISL. According to her profile on the Brookdale website, Fischer was previously the Division Vice President for Brookdale’s West division, joining Brookdale in 2017. She brings over two decades of senior living experience to her new role with ISL.
The ecosystem of Discovery’s deep bench of executive leadership across its regional brand landscape has allowed ISL to find best practices in operations and glean new ideas to improve resident and employee experiences.
“We’re able to talk about best practices and find out what’s working and it’s a different way to grow,” Gray said.
Improving operations to evolve in 2024
While operators remain challenged by headwinds in new development this year, many have found new ways to grow in 2024, from campus redevelopment projects to acquiring and turning around communities at a discount to replacement costs. ISL has remained somewhat active on development based on the assumption that demand in the future will ease the headaches of pushing through construction in today’s higher-interest climate.
For 2024, Gray said ISL would continue to find “operational excellence” as the integration continues with Discovery. The company will also add two new developments set to open later this year in Texas and Nevada.
“It is all about evolution,” Gray said. “We are focused on driving results and improving the resident and associate experience.”
At the time of the announcement, Discovery CEO Richard Hutchinson highlighted the long-term vision to build out a national and regional brand management structure that will allow for what he has called sustainable scaling, as previously reported by SHN.
“This wasn’t something where we were just trying to get a bag of money and run off into the sunset,” Hutchinson said. “It was evolutionary and purposeful and thoughtful in its timing, and we really just needed some juice to take it to that next level.”
During a July 2023 edition of SHN+ Talks, Hutchinson noted how ISL and Discovery were relying on “best-in-class, world-class integration consultants” to help ease the transition between both organizations.
Thanks to the help from the companies’ corporate support center, ISL teams at the community level can monitor real-time data regarding resident health, length of stay, occupancy and more.
“We can project outcomes based on what’s happening now and in real-time, and we slice it and we have a whole team looking at projections on things to make improvements where we can,” Gray said.
Gray said operators must continue to innovate on technology integration as ISL and Discovery have in recent years.
“There’s more of a strategic plan around technology I think more so than there ever has been,” Gray said. “That will help drive results and if our teams can focus on the core business, which is taking care of the residents, it all makes sense.”
With the changes in place that will allow for future growth, Gray said the evolution between ISL and Discovery will help teams work “smarter not harder.”
Gray’s perspective when weighing ISL’s operating margins is informed by how rising acuity of residents and length of stay is creating a “new normal” for many operators.
“You’re going to have higher acuity and you’re going to need additional staffing today,” Gray said. “You’re also going to have to change your price offering and determine service levels that change alongside increasing expenses, and it’s just managing to that fine line.”
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