Sunrise Senior Living is heading into 2023 with a renewed emphasis on lifestyle and wellness, and the company’s two senior living communities in The Big Apple are leading the way in that regard.
Late last year, Sunrise Senior Living unveiled a new vision statement to “create a preferred lifestyle for enjoying a longer, healthier, happier life.” The company is executing on that through its flagship luxury properties, all while gearing up to implement enhanced lifestyle and wellness options across its entire portfolio.
That vision is already playing out at Sunrise at East 56th, which opened in 2021 and is offering a range of upscale dining, wellness and health services, including experiences with prestigious New York institutions like the Juilliard School and Waldorf Astoria.
That emphasis on experiences is exactly what Sunrise wants to export across its entire 276-community portfolio. The company’s other flagship luxury property, The Apsley, located at 85th Street and Broadway in New York City, is set to open later this year.
“I think that’s really the future vision of senior living — it is going to be about lifestyle,” said Sunrise Senior Living Senior Vice President of Operations Denise Falco on a recent episode of the Senior Housing News podcast Transform.
Highlights from Falco’s podcast appearance are included below edited for length and clarity. You can listen to Transform on Soundcloud and Apple Podcasts.
On the two Sunrise communities in Manhattan, East 56th and The Apsley:
So these two properties do fall into the larger Sunrise assisted living portfolio, we have approximately 276 communities throughout the United States and I oversee a third of those communities. They are our two luxury properties in the borough of Manhattan. East 56h has been open a little over a year and we are still in the pre-lease phase of the Apsley. We have San Francisco, we have Washington, D.C., but these are our first two within the city.
Both are high-rise communities of about 120 units with 20 to 21 floors and have similar characteristics, but both have their own unique personalities within the neighborhoods that they fall in in Manhattan.
I think they absolutely exemplify [our future goals], not only from a physical structure standpoint, but from the lifestyle and amenities. The goal is to really collaborate with the local communities and it fits the whole theme of luxury senior living and what we offer residents that are looking for a particular lifestyle.
The start was our development team. They really do a lot of research on where there’s a supply and demand and what that might look like. I think they definitely found that there was a low supply of quality senior living in New York City. So we’ll stick to this particular market. Then the conversation happened among Hines, Welltower and Sunrise to pattern on these properties which is a very unique setup for us.
I think these two buildings have opened our eyes up to how exciting these types of projects could be to the type of resident and consumer that we could show what senior living is all about. We’re always looking at other opportunities, whether it’s luxury senior living in a city setting or a less urban environment. We are definitely going to look into future luxury senior living buildings in various areas throughout the country.
We opened and tried to lease-up in the middle of a pandemic, and that provided many challenges that aren’t unique to this particular property. What we learned is just that the consumer is extra special in this particular market. It’s a luxury property and they are very used to living in the city at a certain level and expect that with senior living.
So what is it besides care that we could offer these folks? We are known as a senior living company that provides a high quality of care. But what is that conversation and what else are they getting from it? What is the lifestyle? What is it that we’re going to do to support what they have been so used to living in this particular market? We changed our amenities to meet the needs of those residents that live with us at East 56th.
We continue to tweak our marketing efforts and continue to make sure that we’re aligned with the local markets and those geographical areas that our residents are drawn from.
We’ll continue to lease up. There is a different focus on what our marketing looks like, and what our referrals look like and from where we want them to come. It’s focusing on getting that brand out there. Overall, I think we’re very happy with the interests that we’re seeing in these two properties.
On occupancy across the Sunrise portfolio:
We are definitely seeing progression in the right direction. I think we have seasonal occupancy trends. And at the moment, this isn’t the top of our market. So the end of Q4 and beginning of Q1 isn’t where we’d typically seen massive positive swings in our occupancy, but over the last year or so we have definitely see those positive trends.
We are seeing activity from the top of the funnel all the way down to the bottom of the funnel. We’re seeing a lot more inquiries, we’re seeing a lot more customers coming in and seeing the product in-person. And we are definitely seeing a lot more move-ins than we have historically seen. So I think it is very similar to the rest of the industry, we are feeling confident with what our occupancy will look like in the future.
[On margins,] it’s finding the balance between the mission and the margin and how we continue to provide that quality care and yet still be good stewards of the dollar of the company. The biggest challenge being able to provide margins that are acceptable right now is the labor issue. I think that is going to be our biggest focus this year to ensure that the margins are where they need to be while we continue to provide the care that is of the quality that folks have seen.
On delivering a unique resident experience in New York City:
We’re following the care model that we’ve been following for the last 40 years. Specifically at East 56th, absolutely, they want care. Many of these families could have gone to a home model instead of moving into assisted living.
So it is what they get in addition to the quality care that has been the huge focus for us at East 56th. And they are those lifestyle pieces. What are they getting from an amenity standpoint? What is the building offering them? What kind of socialization are we offering them? What connections are we still able to assist them with out in the community that they were so used to? So those are the types of things … that these residents are absolutely looking for, it’s not about the quality of care that we provide. That’s a no brainer, right?
We’re also partnering with Northwell [Health’s Center for Healthy Aging] at East 56th. So, a very strong collaboration with Northwell Hospital. They are on site, there are a lot of programs specific to East 56th that Northwell is providing for our residents from a care standpoint. So again, care is top notch, no questions asked there. But what makes us different is that care plus that ‘and’ conversation — that lifestyle, how are we tailoring it? What is it they really want to do, specifically to them? And the team has been able to do that among the staff that they’ve chosen, the concierge services that are available, the amenities and the connections they’ve made with a lot of local organizations within New York City has made the difference for this community.
I think one of the biggest collaborations and one that most of the residents enjoy the most is with Juilliard. There is a huge focus on the arts within this particular community, and we have actually combined forces with Juilliard and we provide on a monthly basis various opportunities for our residents to participate in. And when I say ‘participate in,’ I really mean they are participating in various artistic programs with Juilliard.
There’s an educational series with Juilliard that our residents participate in. And there are numerous performances. Not only do we go to Julliard and see them in-person, but their students come to us as well. So that’s been one of the strongest collaborations.
We are also just starting up and working with Broadway Cares. We will be working with them and how we could sponsor events on what it is that they are doing with the Broadway community. We are working through some finer details on that — more to come there, but we are super excited about that relationship.
And then there are relationships with the New York Historical Society, MoMA, the Met — and specific to East 56th.
The East Midtown partnership has been super helpful in really having East 56th assimilate into that local hyperlocal market around it. And they have done a lot of collaboration there. I didn’t realize trick-or-treating wasn’t a thing in New York City. Who knew? So, through the East Midtown partnership, kids came and trick-or-treated all through East 56th. So there’s been a lot of community partnerships, and that is really putting East 56th on the map in that particular area.
Sunrise introduced a new vision statement to create the preferred lifestyle for enjoying longer, happier, healthier lives. So it’s taking what we are doing at East 56th and being able to work with every single community within Sunrise. I think that’s really the future vision of senior living. It is going to be about lifestyle.
We want people who are going to be jealous, the daughter or the son of our residents, to be jealous of mom, dad and their uncle who now lives in one of our communities.
On integrating the new vision statement:
Company-wide, it’s easier at the moment to integrate at East 56th. But it’s also easier to integrate into a lot of our newer communities. We do develop and build a set of communities, and it’s really easy to integrate lifestyle there from a facility standpoint and from a physical plant standpoint. The buildings have been tweaked and changed to address more of these, or have a larger impact on … lifestyle ideas for our future residents.
The design has already changed, our physical plant has already changed. So a lot of conversations are now starting: ‘Okay, but how do we do that for the other 270-some-odd communities?’ And it’s not solely about the physical plant and the space. It’s about the experiences that we could provide through various changes or tweaks in. Where are we focusing our team? Is it an additional activities team? Do we change the concept of an activity and activities team member? Do we move to a concierge service where it is more individualized attention to the lifestyle that someone wants? Do we offer lifestyle packages?
Nobody’s care needs are exactly the same. So are those customized? Can you have a customized lifestyle package? I have what I like to do in my spare time, you probably have what you’d like to do. So do all of our residents.
There are pieces of it that we are rolling out now, and pieces you’ll see a year from now and two years from now as we tweak what this looks like in all of our communities.
The vision statement was our biggest reveal on what that looks like and how we are changing to meet that need. It’s not going to be a sole focus on care, it’s really going to be more about lifestyle and wellness. Care needs are always going to be there, but the baby boomers, their focus is on how I can stay well. What wellness programs are you going to provide, that’s one of the biggest changes we’re making. They’re one of the first generations that are IT-focused and tech savvy.
We use a device at East 56th and will be using at The Apsley that monitors heart rate, blood pressure and steps. It allows us to get a glimpse into the wellness of our residents and how we can affect their wellness and wellbeing before it gets to the point where they need care or a new medicine or some sort of medical intervention.
On marketing in NYC and the surrounding area:
Our marketing strategy for Sunrise at East 56th is more social media driven with a hyperlocal focus to that particular area.
The Apsley is a larger marketing focus. It’s really getting the name out there and having it associated with Sunrise. So we’re doing more broad-based marketing, both social media, internet-driven, print ads; and we’ve shifted to do some things in New Jersey as well. So, definitely a different strategy.
But the sales approach is basically the same and it also goes back to an individualized sales approach to what that customer’s needs actually are. I think that’s where the two communities definitely work together, having the same amenities. Those communities are going to work very closely around which community will fit the needs of a particular resident better.
On the biggest operational challenges in 2023:
It’s still labor.
As it relates to East 5th, it wasn’t a recruitment and hiring or a labor concern; and I think you’ll find this with any building that is just opening up. The amount of time you spend on the hiring and the training and ensuring that they are ready to go and do everything that was needed of them in a new building — a lot of the team members had never worked for Sunrise before. So, it was taking a whole bunch of people and getting them trained and onboarded and in step with what it was we needed to be.
Those of us who’ve been working for Sunrise knew what needed to be done in order to be able to execute successfully once residents actually moved in. That is always a challenge when you’re opening up a new building. So again, it’s not labor from a hiring standpoint, but it’s ensuring they knew how to execute on all aspects of it perfectly.
We had a huge focus in 2022, and we’ll continue in 2023, on providing supplemental recruitment assistance to our community teams. In the past, historically, recruitment of community team members was really a community function. We had a talent acquisition team at our corporate offices, but we really ramped that up over the last 12 or 14 months.
And there’s a lot of focus on recruitment, and there are now extra hands that are available for our community teams as it pertains to recruitment. So that has been a huge help for us. We have a metric we call TITO — a team member in, a team member out. We’ve seen a really nice gain in the amount of frontline team members that we now have working for us within Sunrise.
That doesn’t help us if we continue to have a back-door problem. So what have we done to engage our team and to make sure that they stay with us? We have done a lot on the wage front, we have done wage analysis across the board, we have made wage changes to our frontline team where appropriate.
Our company had done a complete rehaul of our benefits package and 2022. So we rolled out an entirely new benefits package, which has a lot of positive changes for our frontline team. I think the changes that were made, addressed the majority of our team members and the majority of our team members are those frontline folks — changes to wages, changes to benefits, flexibility. Gone are the days where somebody works Monday through Friday. We have absolutely opened our minds to the flexibility of our scheduling and meeting the schedules and the needs of our frontline team members and put a huge focus on work life balance, which that scheduling absolutely plays into.
Covid is still a challenge for us. I think staying on top of the changes in regulations, the different states and how they do things differently. That continues to be a challenge.
I think that we see light at the end of the tunnel. I think we understand what the new normal is now. Most of us have adjusted to what that is and have tweaked operations to address that. We’re definitely feeling better and more optimistic about the industry and senior living and being able to operate how we need to operate and be more flexible and open to change as we operate in the coming years.
Like many other operators, we absolutely used contract labor in 2022. I am happy to say that we have seen an over 90% decline in the amount of contract labor that we have been using recently. We are extremely close to eradicating the need to use contract labor across the company. We are in a handful of communities that are currently using it, and they’re in certain pockets. But we have made vast strides in eliminating the use of contract labor.
And all of that is done through those the things that I had touched on. But it has made a huge difference to team member morale and team member engagement. Contract labor did not help engagement, those folks weren’t invested. And so the elimination of contract labor has absolutely helped with overall engagement, for sure.
On big goals and opportunities for 2023:
I think it’s our occupancy. That will continue to be a focus for Sunrise and we have some recent changes to our executive leadership team which have brought some very unique perspectives to the lifestyle piece and occupancy piece. We will be looking to implement some changes for sure in those two areas.
I think the last year or so has really been a transformation for those of us who’ve been with the company for 15 or more years, like myself. It’s like a breath of fresh air for [CEO Jack Callison] to come in with the ideas that he’s coming in with and keeping us relevant in a market that we’ve been in for so long.
All of us are really looking forward to that change. And it’s not a change, it’s an added conversation. We’re never going to get away from care. We’re never going away from being the industry leader in the care we provide.
It’s being able to provide that extra wellness focus, the lifestyle focus. So we are excited about that. And I am very excited, personally, on being able to really just focus on the new normal and to stop having to address just one crisis after another, whether it be labor or Covid or everything that’s been thrown at the industry over the last couple of years.
It is really time to be able to settle down and really move toward the quality that we’ve provided over the last 40 years and what the next 40 years of excellence look like for our company. So I think it’s a really exciting time for us.
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