January 4, 2018, Tim Regan, Senior Housing News - If all goes according to plan, Spectrum Retirement Communities will soon be operating more than 50 senior living communities across the nation. The Denver-based company currently has 37 communities spread across major metro areas in 13 states, but plans to open many more by 2019.
The company currently has 16 communities in the works, with recent construction projects in states such as Arizona, Illinois, Indiana, New Mexico, Ohio and Texas.
That pace may seem ambitious, but it’s actually part of a careful strategy on Spectrum’s part, according to Brad Kraus, Spectrum’s president and COO. For one, the company prefers to develop in markets in which it already operates.
“We like to create a pod of communities in specific markets,” Kraus told Senior Housing News. “We find that we can operate them more efficiently and we can attract better talent by having multiple communities in a single market.”
At the same time that it values efficiency and standardization, Spectrum’s development approach hinges on specializing to meet market needs.
Selection is key
For Spectrum, one big piece of the puzzle is market selection, Kraus said. The company spends a considerable amount of time studying demographic profiles in markets across the U.S.
“We don’t do it the other way around, where somebody will approach us with a site and then we’ll look at the demographics,” he added. “We pinpoint markets and then we go in and find development sites. We’re constantly assessing where we feel that we should either expand in or move to.”
Once it targets a new location, Spectrum uses that demographic information to determine the kind of community it will build. For example, the operator might build an independent living community in one market and an assisted living community with a memory care component in another—and the market-specific specialization doesn’t end there.
“One thing that stands out is when we build communities, we have many different floor plans of units for our residents to choose from,” Kraus said. “Our residents can really choose a floorplan that fits best for them…some communities have over 14 different types of floorplans.”
Spectrum works with an in-house architect and a few other outside designers to tailor each community to its potential residents.
“I believe that gives us a competitive advantage to continue to meet the changing needs of the resident population,” Kraus explained. “Every time we break ground on a new community, we make sure we can still provide the same kind of care…as when we had 10 communities.”
While each new development is geared toward serving the local population, the typical Spectrum building has between 125 and 200 units, offering rents at market rate. The company declined to share its average development costs.
Another important part of Spectrum’s growth strategy is hiring. To help it scale smoothly and gain fresh perspectives, the company searches for top talent from both inside and outside the senior living industry.
For instance, the operator recently hired Karin McCrary to serve as executive director of its Park Meadows Senior Living community in Overland Park, Kansas. McCrary, previously a chief operating officer for a local competitor, came to Spectrum in December.
“Our goal is always to find someone in the market…that has a lot of experience in the senior housing industry so we can provide the best possible care,” Kraus said. “A great example is Park Meadows, with our executive director there.”
As more Spectrum communities come online across the country, Kraus said the goal is to have them staffed up and “raring to go” when they open their doors. And on that front, so far, so good.
“We’ll see what 2018 and 2019 brings, but with our current pipeline of deals under construction we’re very excited for the new year,” Kraus said.