Two senior living operators have merged in a move that has created a new company with 19 communities in seven states.
The Florida-based companies — Solvere Living, headquartered in St. Petersburg; and AgeWell Living, headquartered in North Palm Beach — on Jan. 1 merged, forming a new company called AgeWell Solvere Living.
The two companies’ integration is ongoing, with a new website launching in a matter of days. Terms of the deal were not publicly disclosed.
The move is yet another example in the recent trend of senior living companies choosing to join forces and forge a new path together instead of going it alone. Other recent examples include the merger of Cadence Living and Cogir.
Although the name is changing with the merger, the combined company is keeping its communities’ respective branding and identities intact. In addition to its 19 open communities, AgeWell Solvere Living also collectively has five more projects under construction and slated to open later this year along with a pipeline of more deals beyond that.
With the merger, AgeWell Living Chairman Larry Landry is keeping his title, as is President and COO David Mills. Mark Lichtenwalner, who was AgeWell Living’s CEO; and Kristin Kutac Ward, who was CEO of Solvere Living, are leading the newly combined company as co-CEOs.
Kutac Ward is also leaving her role as CEO of Solutions Advisors Group, a sister company of Solvere’s that provides consulting and other services to senior living communities and operators.
Additionally, Solvere Chief Wellness and Compliance Officer Lorie Dancy is slated to keep her title with the merger, while Anne Stuart will join AgeWell Solvere Living as CFO in the future. Solvere SVP of Sales and Marketing Rich Gordon is also staying on in his role with the combined company.
Being a small operator in the pandemic era is challenging, given rising costs and other headwinds, according to Kutac Ward. By combining, Solvere and AgeWell have greater capability and resources to grow, manage and evolve during potentially challenging times ahead.
“Nobody can do this alone, and as things continue to get harder, I’m really excited about having a full team of partners to work together to be better,” she told Senior Housing News. “It is energizing after three energy-draining years.”
Lichtenwalner added that he is particularly looking forward to bringing Solvere’s sales and marketing functions to bear.
“We’re strong and strong on the operation side, but we could use some help in sales and marketing,” he said. “With the two companies together, we believe the combination will be advantageous.”
Merger years in the making
Although the merger came together at the start of this year, the two companies had flirted with the idea of combining before. Lichtenwalner said he and Kutac Ward had early discussions about a possible merger at a NIC conference about four years ago.
“We were brainstorming after the conference one day and we said, ‘Hey, maybe we should consider merging together,’” Lichtenwalner said.
That discussion led to more meetings. But the two parties ultimately decided to hold off from coming together as one.
By 2022, market fundamentals had shifted enough for the two leaders to rekindle their discussion about joining forces. This time, the idea sprang from a conversation Kutac Ward had with former AgeWell COO Mills at the Senior Living Innovation Forum in California last year.
“He was talking about some of their community challenges, and I was talking about some of ours — we were commiserating,” she said. “All of a sudden, I paused and looked at him and I said, ‘You know what? Maybe we should talk again.’”
Now that the merger is official, the new company’s management team is still putting the pieces together on a larger strategy for 2023 and beyond. The operator will initially look for opportunities to third-party manage existing communities or co-invest in new-build rental communities offering a full continuum of care.
In particular, the new company’s Celebration Village communities — which Lichtenwalner described as lifestyle-focused rental CCRCs — represent one blueprint for more co-investment in the future. He added that the company is interested in seeking minority ownership in future such projects.
Active adult is another area of growth, and Kutac Ward noted that Solvere has managed active adult communities in the past. AgeWell Solvere Living is also working with a to-be-revealed company that is launching a new active adult portfolio in 2023.
She added that she was particularly excited about the added brain power the merger brings. While Solvere had made a name for itself as a turnaround company in past years, that practice largely stopped as turnarounds became much more complicated during the pandemic.
But with a bigger team and more resources behind it, Kutac Ward believes the company will once again have the bandwidth to take on turnarounds and other more complicated strategic opportunities.
“Our combined teams are well-equipped to do that,” she added. “We’ve got more than enough infrastructure to handle growth.”
For Lichtenwalner, the new company is sort of like getting an old band back together. In addition to his longstanding relationships with Kutac Ward and Chairman Landry, he also previously worked with Mills and incoming CFO Stuart at the former operator Marriott Senior Living in the 1990s.
“It’s almost a dream come true for all of us,” he said. “Now we’re all coming together and it just makes a lot of sense.”