Covid-19 is putting pressure on academic institutions, creating a clearer and stronger case for why universities should partner with senior living providers.
Senior living affiliations with colleges and universities were gaining traction prior to Covid-19, and industry leaders such as NIC Co-Founder and Nexus Insights President and Founder Bob Kramer and Kendal Corporation President and CEO Sean Kelly predicted that the pandemic would accelerate the trend.
Now, that scenario is becoming clearer, as the challenges facing academic institutions mount.
While some universities have planned to forge ahead with in-person classes this fall, that has contributed to coronavirus outbreaks across the country. Other colleges have held off full reopenings and pivoted instead to remote learning programs. Whatever the case may be, the pandemic’s disruptions complicate the normal enrollment process for most U.S. colleges and universities. And that may incentivize them to consider senior living partnerships as a way to ward off financial pain, especially if students don’t return to campus in pre-pandemic numbers down the road.
Just ask Ryan Haller, an industry veteran who heads up senior living consulting practice Orchard Hill Partners. Haller is poised to launch a new real estate venture called WELL Companies that will include a brand specifically focused on university and senior living partnerships.
Although the pandemic is still in its early days and therefore hard to predict, Haller believes that universities could face possible budget shortfalls related to restrictive endowments and low in-person enrollment totals in the months and years ahead. And that may present an opening for providers to get in front of academic leaders with new ideas.
“It’s now become a situation where you can put a presentation together, and you’d be surprised how quickly you’re in front of the top brass at any university,” Haller told Senior Housing News. “Because they recognize it’s time to get creative, and they’ve got to fill the gap in their budget.”
But while some universities may be in more dire circumstances than they were a year ago, the fundamental value proposition behind affiliating with senior living communities has not changed, notes Andrew Carle, who serves as lead faculty for the curricula in senior living administration at Georgetown University, and who pioneered the University Based Retirement Community (UBRC) model. Today, Carle works as executive director of The Virginian, a community managed by Life Care Services in Fairfax, Virginia.
“The larger factor is simply that Covid, no matter how long this past year has seemed, is temporary, while the long-term demand drivers for UBRCs have not changed,” Carle told SHN.
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Perhaps the biggest drivers behind an acceleration of the senior living/university partnership trend are declines in on-campus enrollment and revenue. Both the university and senior living sectors are experiencing pressure on bottom lines, Kramer said.
“[Before the pandemic], if you were an assisted living provider and you had occupancy under 85% … depending on your mix, you’re probably in a world of hurt right now,” Kramer said. “Similarly, if you’re a small, private liberal-arts college with expensive tuition and not a huge endowment, you’re probably also in a world of hurt right now.”
At the same time, both senior living providers and colleges are grappling with a customer who, thanks to advances in communications and technology, can find alternative services while remaining in their own homes.
All these parallel challenges could also spur new opportunities for integration between the two fields, and for learning from each other.
For universities which take the plunge and partner with a senior living provider, there are many potential advantages, including attracting more affluent senior living residents to spend money and time on-campus, while also opening up new research and career development opportunities. And for providers, it’s no secret there are big advantages in linking up with a university, such as name recognition and new avenues for employment and collaboration.
“Universities need new revenue streams, they need to figure out who’s going to live in those dorms, they need to figure out who’s going to want an on-campus experience,” Kramer said. “So, has the calculus changed? Absolutely.”
Ivy League schools or other large, well-funded universities are much more likely to have the deep pockets to weather bad times, Kramer added. But smaller colleges with student populations numbering in the low thousands are in the most danger, with recent data showing as many as one-third of all private, four-year colleges in the U.S. are high-risk, financially.
As Haller noted, these conditions make it easier to make the case that senior living communities and college campuses are a good match. But that doesn’t mean universities themselves are taking the initiative, or that providers can simply walk into a university chancellor’s office expecting a meeting. Instead, senior living providers must be ready and willing to present their vision to universities.
“I don’t think any university president in their boardroom has yet specifically said, ‘Let’s go talk to senior housing providers,’” Haller said. “It’s actually the other way around.”
And Carle has long believed there is an opportunity for a senior living provider with the right operational model and brand recognition to take the initiative in forging these kind of partnerships.
“I think universities would be relieved to know that there is somebody out there who specializes in this, has developed the track record in this, and has taken a leadership role in this,” Carle said.
But consumers themselves — namely aging baby boomers — are perhaps the biggest driver of the trend.
“They are lifelong learners who believe their next act isn’t their final act and they believe they have a lot to share with young adults, yet they remain curious themselves on how they can continue to drive for personal betterment,” Haller said.
Indeed, the preferences of incoming senior living residents themselves are also likely to create tailwinds for the trend. Baltimore-based Brightview Senior Living recently announced the beginning of feasibility studies for a new community in partnership with Notre Dame of Maryland University, and the two organizations cited synergies between students and older adults as a motivating factor.
The baby boomers are more likely to have gone to college than their parents, and therefore are more likely to have fond memories of their college days than the generations that came before them. This could give a senior living community with strong university ties a leg up over their competitors.
“For many boomers, especially after all the unsettledness of the last few years, recreating that experience is very attractive to them,” Kramer said.
And while it’s true the pandemic is likely making the baby boomers more nervous than before about living so closely among their peers, Kramer believes they will also see that there is a trade-off between safety and socialization.
“We have a fear of congregate settings,” he said. “But we also realize we need and want them more than ever before, because we’ve been deprived of them.”
Models for the future
Haller has tracked about 70 university-based partnerships throughout the U.S. in doing research for his new company, with most of them involving private colleges. Many of those partnerships involved superficial connections between a senior living provider and a university — for example, an arrangement where a university might provide a contact list of alumni and a provider would fund an annual luncheon. But the real prize for providers is a more robust partnership in which a university would contribute some form of equity, he said.
“Typically, that form of equity is underutilized land,” Haller said. “And if that land is worth $6 million, then that’s $6 million worth of equity that [universities] can put in the project.”
In return, a senior living community would potentially attract hundreds of residents — some of them alumni with “deep pockets” — to take part in campus on-campus classes or events.
In the future, Haller doesn’t believe university-linked senior living communities will exist as “space-fillers” on or adjacent to campus. Instead, he believes that the university partnerships which are successful tomorrow will be integrated into the fabric of universities’ master plans.
Two recent projects exemplify that concept: Legacy Pointe at UCF, which is slated to open next year near the University of Central Florida in Orlando; and a plan to build an intergenerational “learning center” with preschool facilities and retirement housing at Texas A&M University in College Station, Texas. Both projects go a step above traditional senior living by getting buy-in from the university or its faculty leaders, Haller said.
This is also a trend at current senior living communities with university partnerships, such as Lasell Village — a continuing care retirement community (CCRC) located on the campus of Lasell University in Newton, Massachusetts — where residents agree to complete at least 450 hours per year of activities such as coursework, student mentorship and research projects.
Another model that might give providers a window into the future is Mirabella at ASU, a 20-story life plan community from Pacific Retirement Services under construction on Arizona State University’s main campus in Tempe, Arizona. The community offers residents opportunities to continue lifelong learning at ASU and take part in the school’s cultural and athletic programs.
“There are a million ways you can do it, as simple as sharing your landscaping or your security guards or your shuttle buses,” Carle said. “It doesn’t have to involve direct ownership or involvement in the operations.”
One thing that hasn’t changed as much is the amount of time it takes to get a university partnership off the ground. Before the pandemic, it typically took up to a decade for a university-backed senior living project to come to fruition. The pandemic has likely accelerated the process, but not by much, Carle said. And Haller estimates that, as university-backed projects become more common over the years, that window could shrink to 5 to 7 years — but that is by no means sure to happen.
“You’re still dealing with the bureaucracy of universities and red tape,” Haller said. “Like most good deals, they’re all relationship based.”