Five Star Senior Living (Nasdaq: FVE) has named a new president and CEO, and current company leader Bruce Mackey is preparing his exit.
The Newton, Massachusetts-based senior living owner and operator has chosen Katherine Potter to take the reins on Jan. 1, one day after Mackey is set to retire from the company. Potter, 42, first joined Five Star in 2012, and currently works as the company’s executive vice president and general counsel. Prior to joining Five Star, Potter practiced law at Sullivan & Worcester LLP and at Burns & Levinson LLP.
Mackey — who has been with Five Star since its founding in 2001 and has served as president and CEO since 2008 — has agreed to remain a non-officer employee of Five Star until the end of 2019.
Five Star as of Sept. 30 owned, leased or managed 283 senior housing communities in 32 states. That total includes independent living and assisted living communities, continuing care retirement communities (CCRCs) and skilled nursing facilities (SNFs). Five Star is the fourth largest senior housing operator in the country by unit count, according to recent data from industry association Argentum.
Potter joins Five Star at a challenging time. The company is currently considering a wide range of options as it faces operational and financial woes. These challenges “raise substantial doubt about our ability to continue as a going concern,” Mackey said during a third-quarter earnings call in November.
“Our #1 focus is (and will always be) an exceptional resident experience and supporting and developing members of our team,” Potter told Senior Housing News in an email.
The company has in recent quarters struggled with an anemic occupancy rate and fierce competition from other memory care providers, to name two challenges. But there are a few bright spots, too, namely the company’s growing Ageility Physical Therapy Solutions rehab and wellness division.
At the same time, Five Star’s management is also working on ways to help boost the company’s cratering share value. The operator’s stock price averaged less than $1 per share over the most recent 30-day trading period in October, threatening its continued listing on Nasdaq.
This isn’t the first time the company has encountered rough waters. In 2016, Five Star fielded a tender offer from activist shareholders William Thomas and Robert Thomas that sparked a fight at the time. The Thomas brothers, co-founders of Oklahoma-based senior housing owner and operator Senior Star, were dissatisfied with the company’s share price and governance.
Written by Tim Regan
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