AlerisLife Inc. (Nasdaq: ALR) announced Jeff Leer as interim president and chief executive officer on Monday following the resignation of former President and CEO Katie Potter last week.

Leer has served as executive vice president, chief financial officer and treasurer for the company since 2019.

“Given the dynamic shifts in the senior living industry and the disruption caused by the COVID-19 pandemic, we believe that now is the right time to undertake an operational review to ensure that the company will deliver enhanced financial performance and value creation over the long term,” AlerisLife Board of Directors Chairman Adam Portnoy said in a news release regarding the leadership change.

AlerisLife also announced it had contracted with consulting firm Alvarez & Marsal (A&M) to conduct an operational review of the company, with results from the study expected by the end of the second quarter. The board will not conduct a final CEO search prior to the review being completed. 

RMR Group and AlerisLife did not respond to requests for comment from Senior Housing News on Monday. AlerisLife is scheduled to release its Q1 2022 earnings results on Wednesday.

In Monday’s news release, Leer said his focus will be working with the consulting group to “advance the operational review” of the company while supporting the board.

Potter resigned effective Friday, April 30, having helped the company navigate the Covid-19 pandemic.

“On behalf of the entire Board, I want to thank Katie for her years of leadership and vision at ALR and the senior living industry,” Portnoy said. “Katie’s tenure included guiding the Company through the unprecedented COVID-19 pandemic and creating a business foundation to help position ALR to service the senior living industry.”

As of early 2022, the company operated 140 senior living communities, with active adult and independent living units accounting for 52% of the portfolio, with assisted living being 39% and memory care at 9%.

An eventful tenure

Potter was named CEO of AlerisLife — known at the time as Five Star Senior Living — in Dec. 2018. She had first joined the company in 2012, and had been serving as EVP and general counsel.

At that time, the company operated more than 280 senior living communities, and had been struggling from financial challenges that had led to a “going concern” warning about the business’ continuing viability.

With Potter at the helm, Five Star restructured its leases with major real estate investment trust partner Diversified Healthcare Trust (Nasdaq: DHC) — both companies are part of Portnoy-led alternative asset management company The RMR Group.

The senior living provider also made a slew of hires, updated its revenue management system, put the focus on operational improvements, and Potter laid out a vision for a more diversified company to serve the coming generation of baby boomers.

“In terms of what we’re doing at Five Star, I think we’re really starting to think about how we take our successes, our expertise, and leverage that into other product lines or different offerings within our communities,” she told SHN in March 2020.

Shortly after that interview, the Covid-19 pandemic altered plans.

In April 2021, Diversified announced a plan to transition 108 Five Star communities to other operators by the end of the year. The goal was to enable Five Star to focus on operating larger senior living communities with a focus on more independent residents, and also on its expanding Ageility rehabilitation and wellness business.

With those transitions complete, Five Star continued a push toward reinvention, including through the rebranding to AlerisLife in early 2022. The company also struck partnerships with Compass Group to operate its dining services and DispatchHealth to provide acute care for residents.

Like other senior living providers, AlerisLife was hit hard by occupancy loss during the last two years; month-end occupancy had ticked up to 74.8% as of Dec. 2021, compared to 73.7% a year prior. The company touted improving lead and tour volume and an increasing conversion rate, as well as an 8% average room rate increase as of Feb. 2022. But AlerisLife’s share price has lost about 50% of its value in the last six months. The company posted a Q4 2021 net loss of $10.7 million, compared to a net income of about $2.9 million a year prior.

The company’s shares were down 11.84% at the end of regular trading on Monday, at $1.89.