Shepherd Premier Senior Living has outlined a development pipeline that will put it at 30 small-home communities within the next three years.
The McHenry, Illinois-based provider was founded in 2014, and has developed five small-home communities over the past five years. But its next project is its largest to date: a $21 million development consisting of nine small-home properties and 144 beds. The project, located in Huntley, Illinois, is slated to be developed in two phases of 96 and 48 units, respectively.
To finance that growth, the provider has a $25 million fund, 80% of which will go toward new development.
“We believe that building will allow us to move at a much greater rate than buying existing properties and renovating them,” Theresa Maskrey, partner and COO with Shepherd Premier, told Senior Housing News. “We think standardizing a new build will allow us to grow faster.”
While Shepherd Premier is not the only small-home senior living provider in the U.S., it exemplifies a product type that exists as an alternative to traditional senior living. Shepherd Premier CEO Brandon Schwab first decided to launch his own senior living operation in 2014 after visiting a small-home community in Tampa, Florida.
“I got exposed to a different way of how they care for the elderly,” Schwab said. “It was a five-bed home [near Orlandp] with five people living in it. When I came back home [to Illinois], I was like, that was interesting.”
So, Schwab — who owned a sandwich-lease portfolio of 23 rental properties at the time — decided it was time for a change and sold 22 of his 23 properties. He bought his first senior living property, a 4,800 square foot home with 10 beds, for $250,000 and invested an additional $550,000 into it.
Shepherd Premier has honed its model over the years, and is now bringing it to market in a bigger way. The provider specializes in 16-bed homes that resemble a normal suburban dwelling inside and out.
Rates for residents vary from home to home, but typically range from about $5,000 per month for a shared room and $6,000 per month for a private room.
Shepherd Premier offers independent living, assisted living and memory care services, with staffing ratios of one worker per five residents. That model helps caregivers form close bonds with residents and stands as an alternative to more traditional senior living communities where residents live in apartment-style settings.
“We feel that if people are given the option, they would choose to be in a very tight, good home, compared to a 200-bed place that feels a little bit more like an apartment building,” Schwab said.
In addition to dining and help with activities of daily living, Shepherd Premier also incorporates spirituality and religion into its services.
“Any fear of death, we want to take it off the table,” Maskrey said. “We think that peace of mind and comfort from faith in God are a big component of senior care.”
Looking ahead, Shepherd Premier will set its sights on Illinois for growth. But the company may also grow in warm-weather states, such as Florida, in the coming years.
Shepherd Premier already is in talks to buy a Florida provider’s portfolio of seven small-home properties.
“The overall goal is to have 30 up here [in and around northern Illinois] and 30 throughout either Tampa, Orlando, or the East Coast there,” Schwab said. “There is a senior housing crisis looming out there and we’re going to go as fast as we can without sacrificing care and while staying true to this small model.”