After Growing to 36 Communities, Navion Senior Living Turns Focus to Operations

After growing a base of operations during the Covid-19 pandemic, Navion Senior Solutions is turning its focus in 2022 to honing its operations.

The Raleigh, North Carolina-based operator grew from a handful of communities to 36 during the Covid-19 pandemic, and that growth is set to continue with one community currently under construction and another expected to break ground soon.

But while growth remains a focus, the company’s top priority in 2022 is honing its processes and methods, according to Navion CEO Steve Morton.

“Our plan for 2022 will be to focus on operations,” Morton told Senior Housing News. “As far as growth is concerned, it will come, but we’re restraining ourselves from doing it too quickly.”

Strategy for 2022

Adding so many communities in more than a two-year span was not easy, according to Morton. Although the company’s growth was “incredibly positive” overall, onboarding new employees and communities during a pandemic were at times “a bit of a dance,” he said.

So, starting in the middle of 2021, the company’s leaders began to double down on its methodology and training “in a much more effective manner” than before, given the lessening of certain operational pressures.

In the time since, Navion has implemented flexible scheduling for workers and focus groups at the community level as well as upped wages for workers. The company has also honed its sales practices to be more “accountable,” Morton added.

“We’re turning up and turning up the knob, so to speak, on satisfaction survey frequency, figuring out how to get into the phones of all of our employees, asking them how they’re feeling,” he said.

Where the company is growing, it is doing so with a specific strategy in mind. Navion specifically searches for opportunities that are no more than a five-hour drive away from a market it already operates in.

That is a strategy he initially honed with Pegasus Senior Living CEO Chris Hollister at Chapel Hill, North Carolina-based Southern Assisted Living, the company they co-founded and ran before selling it to Brookdale Senior Living (NYSE: BKD) in 2006.

“If somebody calls and says we’ve got 20 communities for you, we’re probably not doing that deal unless it’s all in North Carolina or in a contiguous state,” Morton said.

The Navion portfolio includes 36 communities across seven states, 19 of which are owned by the company. Nearly all of the communities offer assisted living, while 20 have memory care and six have independent living services. The company’s largest concentration of communities is in its home state of North Carolina, where it owns 15 communities and manages another.

Navion’s portfolio is broken into a handful of geographic regions: The coastal Carolinas; the western slope of the Appalachian Mountains in Georgia, Tennessee and Kentucky; central North Carolina; and two that encompass western North Carolina and West Virginia.

The company tasks three directors overseeing clinical functions, sales and marketing and operations with looking after six to eight communities in their respective regions.

As for current growth, Navion is in the midst of building a $42 million independent living and assisted living community in Apex, North Carolina, and is in the process of securing a construction loan for a community in Wake Forest, North Carolina. The communities will expand on a recent trend in memory care of smaller-sized homes, with Navion’s model housing just six residents to a 5,000 square foot home.

The model gives communities “an entirely different feel to the care and the individuality of that care for six people rather than … having 24 residents and trying to hit the needs of all of them,” Morton said.

Navion is also seeking opportunities to acquire or manage certain distressed communities with the aim of improving operations there. For example, the company last year took on a portfolio of five former Five Star Senior Living assisted living communities in South Carolina for Diversified Healthcare Trust (Nasdaq: DHC).

By overhauling the portfolio’s operations, Navion has boosted occupancy in the communities more than 30% higher occupancy in under six months, according to Morton.

Improving struggling communities is central to Navion’s growth and is a part of its roots. Navion leased its first three communities from National Health Investors (NYSE: NHI), which were in less-than-ideal shape when the operator took them over.

“ It took nine months and they’re now producing volumes of return that are really pretty incredulous,” said Morton. “And they’re 22 years old.”

Looking ahead, the company plans to continue its focus on honing operations and measured growth — and that starts with its employees.

“At the end of the day, if we don’t do the right thing and support our communities, then we don’t have a business,” Morton said.