Economic Update—It’s All About COVID-19

A lot of economic news today, July 30, much of which was not encouraging.

A lot of economic news today, much of which was not encouraging. First, the long-awaited first estimate of GDP growth in 2Q 2020 was released by the Bureau of Economic Analysis and as anticipated the number was historic, with an annualized decline of 32.9% reported. Second, and for the second consecutive week, the number of initial claims filed for unemployment insurance rose. Third, the Chair of the Federal Reserve, Jerome Powell, encouraged Congress to act quickly to inject further fiscal stimulus into a weakening economic landscape.

Regarding the GDP report, the estimated inflation-adjusted output metric of all goods and services produced across the U.S. economy plunged 32.9% in the second quarter, a record one-quarter contraction of the domestic economy. This was more than three times larger than the previous record quarterly contraction and underscores the unprecedented impact of the pandemic on the broad economy.

A collapse in household spending (down 34.6%), which was already weak in the first quarter (-6.9%), led the plunge reflecting historically large job losses, stay-at-home orders, lockdowns, and large numbers of business closures. Services consumption was down by 43.5%, with the biggest declines coming in healthcare, as non-essential check-ups and procedures were delayed as well as dramatically less spending on entertainment and restaurants. Shutdowns and weak demand also weighed on business and residential investment. In contrast, the federal government fiscal stimulus contributed to a 2.7% rise in government spending, although that metric would have been larger had it not been for a 5.6% drop in state and local spending which reflects the revenue shortfalls at these jurisdictional levels.

Despite the drop in income associated with job losses, inflation-adjusted disposable income jumped by 44.9% at an annualized pace as unemployment insurance payments helped offset the loss of paychecks and tips.

A robust third quarter bounce back in GDP is looking less likely, given a resurgence in coronavirus cases that is weighing on economic activity. COVID-19 virus containment is key. Without it, a more complete reopening of the economy, which is crucial for recovery, will remain out of reach.

Separately, the Labor Department reported that jobless claims rose to 1.434 million in the week ending July 25, up from 1.422 million in the prior week. This marked the second consecutive weekly increase and the 19th consecutive week that claims exceeded one million. Up until two weeks ago, this metric had been falling on a consistent basis week over week. Continuing claims for regular benefits, which are reported with an extra week’s lag, rose by 867,000 to 17.018 million in the week ending July 18. Including people who are collecting benefits under expanded pandemic assistance, 30.202 million people were receiving unemployment insurance in the week ended July 11. By this measure, the unemployment rate would be calculated as closer to the high teens level versus the 11.2% official rate reported by the Labor Department. The increase in the weekly rates reflects the resurgence in COVID-19 cases which in turn has resulted in a pause or in some situations a rollback of re-openings across some states.

Separately and earlier this week, the Conference Board reported that its index of consumer confidence fell in July as consumers became less optimistic about the short-term outlook for the economy and the labor market.

Meanwhile, the Federal Reserve met this week and provided a downbeat assessment of the economic outlook. While acknowledging that economic activity and employment had “picked up somewhat,” they still “remain well below” pre-pandemic levels. In the post-meeting press conference, Chair Jerome Powell doubled down on that point, calling the spread of the coronavirus “the most central driver” of the economy, and said the renewed surge in cases had led to a “slowing in the pace of the recovery”. At the same time, he acknowledged the uncertainty, saying how large and how sustained that slowdown will be is unknowable. He stressed that additional help from fiscal policy is essential, stating “fiscal policy can address things that we (the Federal Reserve) can’t address.” He called the pandemic and its fallout “the biggest shock to the U.S. economy in living memory.” Powell emphasized the pandemic will dictate the trajectory of economic recovery.

And with that, thank goodness there is no more economic news being reported today…

Decline in Skilled Nursing Occupancy Continues in May  —   Medicare Revenue Per Patient Day Increases

NIC released monthly data today from the NIC Skilled Nursing Data Initiative. This release incorporates key takeaways of market trends through May 2020.

In a continuation of NIC’s commitment to release data and insights on a monthly basis in response to rapid market changes, NIC released monthly data today from the NIC Skilled Nursing Data Initiative. This release incorporates key takeaways of market trends through May 2020. The following summarizes the monthly release with data from January 2012 through May 2020.

Occupancy

The skilled nursing occupancy rate continued to decline in May due to the impact of the COVID-19 pandemic. Occupancy fell 347 basis points from April to end May at 75.5%. This represents a decline of 784 basis points since March, when occupancy was 83.3% and is down 921 basis points since February, prior to the pandemic. Year-over-year, the occupancy rate is down 862 basis points from May 2019. 

Patient day mix across all four payor types, i.e. Medicare, Managed Medicare, Medicaid and Private, did not see relatively significant movement when compared to the occupancy change from April to May, suggesting admissions decreased across all payor types, except perhaps for Medicare which saw patient day mix uptick slightly.

NIC SNF Occupancy May 2020

Medicare

Medicare patient day mix increased 66 basis points from 11.3% in April to 11.9% in May. Since March, it is up 82 basis points. In addition, Medicare revenue mix was relatively steady from April to May, decreasing by only 11 basis points. When compared to overall occupancy, it is likely that the cancellation of elective surgeries continued to have a major impact on Medicare, even as many states have recently started to allow those surgeries to resume. However, Medicare patient days likely did not decrease as much as it would have given that the Centers for Medicare and Medicaid Services (CMS) waived the 3-Day Rule, which waives the requirement for a 3-day inpatient hospital stay prior to a Medicare-covered skilled nursing stay. This enables more patient days to be covered by Medicare, which can have a positive impact on cash flow, all else equal. Meanwhile, Medicare revenue per patient day (RPPD) increased 0.9% from $548.81 in April to $554 in May. Medicare RPPD likely increased because of additional reimbursement due to COVID-19 positive patients requiring isolation, in addition to the temporary suspension of the 2.0% sequestration cuts by CMS, which will be effective from May 1 through December 31, 2020.

NIC SNF Share of Patient Day Mix May 2020

Managed Medicare

Managed Medicare admissions are likely still experiencing declines because of COVID-19 even as some states resume elective surgeries, as many may still be hesitant to move forward with surgeries because of the pandemic. Many insurance plan enrollees will also be cared for at home after surgeries, bypassing skilled nursing properties. Managed Medicare revenue mix has declined significantly since February, dropping 307 basis points to 7.3% in May. Since March, it is down 228 basis points. However, Managed Medicare revenue mix held relatively steady from April to May and only declined by 27 basis points. Year-over-year, it is down 220 basis points from 9.5% in May 2019. Meanwhile, Managed Medicare RPPD increased 0.6% from $453.53 to $456.35 in May. Since March, it has increased by 1.21% suggesting some reimbursement stability from insurance companies during the pandemic. However, year-over-year RPPD is only up 0.4% from May 2019.

NIC SNF Share of Revenue Mix May 2020

Medicaid

Medicaid revenue mix declined 96 basis points from 49.4% in April to 48.5% in May. Medicaid patient days likely decreased as well, due to lower overall admissions in May and some Medicaid patients converted to Medicare given the waiver of the 3-Day Rule. Medicaid revenue mix has declined 240 basis points since March when the mix was 50.9%. Year-over-year, Medicaid revenue mix decreased 268 basis points from May 2019. Meanwhile, Medicaid RPPD increased 0.4% from $230.30 in April to $231.26 in May. However, there has been an increase of $7.13 RPPD from February, representing a 3.2% increase as states embraced measures to help skilled nursing properties such as increasing reimbursement related to the number of COVD-19 cases at properties. Even with this increase the concern continues to be that current Medicaid RPPD does not cover the actual cost of care in most states.

NIC SNF Revenue Per Patient Day May 2020

 

This analysis and commentary is based off of aggregate data from a sample of skilled nursing operators with multiple properties in the United States. NIC continues to grow its database of participating operators in the NIC Skilled Nursing Data Initiative in order to provide data at localized levels in the future. Operators who are interested in participating can complete a participation form here. NIC maintains strict confidentiality of all data it receives.

 

Executive Survey Insights: COVID-19 |  Wave 2, Data Collected 7/6/2020 – 7/19/2020

NIC’s COVID-19 Executive Survey of seniors housing and skilled nursing operators is designed to bring awareness to of the current COVID-19 penetration rates by care segment.

A NIC report to provide insight into COVID-19 among current residents and to more clearly understand existing conditions by care setting.

NIC’s monthly Executive Survey Insights: COVID-19 of seniors housing and skilled nursing operators is designed to bring awareness to the operators, their capital providers and business partners, and the general public, on the current COVID-19 penetration rates by care segment. Providing data on current penetration rates gives perspective on how the sector has adapted in the four months since COVID-19 was declared a pandemic. Providing data by care segment enables insights into how COVID-19 has impacted the different populations in each segment, which vary substantially in levels of health.  

Wave 2 of the survey includes responses collected July 6-July 19, 2020 from owners and executives of 52 seniors housing and skilled nursing operators from across the nation. Detailed reports for this wave, along with past survey findings can be found on the NIC COVID-19 Resource Center webpage under Executive Survey Insights.

Summary of Findings of Staff and Residents in Place on June 30, 2020

Data collected in a survey of seniors housing and care operators by the National Investment Center for Seniors Housing & Care (NIC), shows operator average COVID-19 penetration varies by care setting among current residents, ranging from 0.4% in independent living, 2.9% in assisted living, and 3.9% in memory care. As was the case with Wave 1, operator average COVID-19 penetration rates were lowest in the least acute care setting of independent living and increased with acuity. Due to sample size limitations, operator averages for nursing care have not been included.

Wave 2 data shows higher COVID-19 testing across all care segments, with an operator average ranging from 18.5% in independent living up to 45.7% in memory care. Survey findings also show an operator average of 78.5% of community staff in place on June 30, 2020, regardless of care setting, had been tested for COVID-19.

Key Findings

Testing and Current Penetration of COVID-19 by Care Segment

Respondents were asked: “Distributed into the following categories, the total number of my organization’s (independent living, assisted living, memory care, nursing care) residents were: 1) Tested for COVID-19 with a PCR test, 2) Laboratory confirmed positive PCR test, and 3) Suspected COVID-19”

  • In Wave 2, the operator average percent of residents tested for COVID-19 (of residents in place on June 30, 2020) for independent living is 18.5%. For assisted living the operator average percent residents tested is 41.7%, and for memory care is 45.7%.
  • The operator average percent of confirmed or suspected COVID-19 in independent living is 0.4%. For assisted living the operator average percent is 2.9%, and for memory care is 3.9%. Due to sample size limitations, operator averages for nursing care have not been included.
  • In Wave 2, operator average testing penetration for independent living was 18.5%, for assisted living was 41.7%, and for memory care was 45.7%. In both Waves 1 and 2, operator average testing penetration increased as care setting acuity increased.

NIC Executive Survey Insights Average % by Care Segment

 

Testing and Current Penetration of COVID-19 Among Community Staff

Respondents were asked: “Distributed into the following categories, the total number of my organization’s staff were: 1) Tested for COVID-19 with a PCR test, 2) Laboratory confirmed positive PCR test, and 3) Suspected COVID-19”

  • The operator average percent of community staff tested for COVID-19 (of staff in place on June 30, 2020) regardless of care setting is 78.5%. Of total staff, an operator average of 5.2% tested positive and another 0.9% suspected positive, for a community staff operator average penetration rate of 5.9%.

chart2esi

Demographics

  • Responses were collected July 6-July 19, 2020 from owners and executives of 52 seniors housing and skilled nursing operators from across the nation.
  • More than one half of respondents were exclusively for-profit providers (56%), 33% of respondents were exclusively nonprofit providers, and 11% operate both for-profit and nonprofit seniors housing and care organizations.
  • Owner/operators with 1 to 10 properties comprise 50% of the sample. Operators with 11 to 25 properties make up 28% while operators with 26 properties or more make up 22% of the sample.
  • Many respondents in the sample report operating combinations of property types. Across their entire portfolios of properties, 51% of the organizations operate seniors housing properties (IL, AL, MC), 22% operate nursing care properties, and 27% operate CCRCs (aka Life Plan Communities).

Methodology

Answering on behalf of their organizations, seniors housing and care owners and executives provided the COVID-19 incidence data shown above. The data is self-reported, non-validated, and based on a convenience sample.

Data is reported as operator averages to prevent the skewing of data that can be caused by larger-sized operators.  Operator averages are obtained by first calculating rates for each operator survey response and then taking an average of those rates across the sample.

Definitions

The following definitions were included with the survey instructions to ascertain specific responses from operators:

  • Lab Tested Positive: Includes only residents who have been tested for active infection with PCR test. Serology antibody tests should not be included. Includes residents who have tested positive for COVID-19 at a CDC, state or local laboratory.
  • Suspected Cases: means the resident is managed as if they have COVID-19 with signs and symptoms suggestive of COVID-19, but do not have a laboratory positive COVID-19 test result or those with pending test results. 
  • Recovered: For residents in a hospital or rehab setting, “recovered” is defined as having had two consecutive negative tests at least 24-hours apart; for residents in-house, 1) 72-hours symptom-free with no medication, and 2) at least ten days from onset of symptoms.
  • Active Cases: Those who are laboratory-tested positive, suspected positive, or diagnosed by a physician, and are still in place but not deceased and do not meet the criteria for “recovered.”

 

NIC wishes to thank survey respondents for their valuable input and continuing support for this effort to bring clarity and transparency into the seniors housing and care space.

If you are an owner or C-suite executive of seniors housing and care properties and have not received an email invitation but would like to participate in the current Executive Survey, please click here for the current online questionnaire.

The Skilled Nursing Sector: Where Do We Stand?

Kauffman asked panelists BJ Hauswald, Sr. Vice President, Planning & Development, Genesis Healthcare and Ray Thivierge, Chief Strategy Officer, SavaSeniorCare for a brief history of the situation in nursing homes, as they rushed to adapt to the pandemic.

Amid a pandemic of historic proportions, skilled nursing properties have borne some of the greatest challenges as they fight to care for the most vulnerable Americans, many of whom are frail and have multiple chronic healthcare conditions that require monitoring and medical attention. The skilled nursing industry responded quickly and aggressively by, acquiring sufficient personal protective equipment (PPE) implementing strict protocols related to sanitation, visitation and move-ins, implementing accurate and timely testing of staff and residents, and by employing new technologies, such as telehealth, to help provide care. In the latest of NIC’s popular “Leadership Huddle” webinar series, held Thursday, July 9th, skilled nursing operators discussed how the sector has changed, and where skilled nursing properties stand as much of the country has re-opened.

skillednursing


NIC chief economist Beth Mace opened the webinar with a brief presentation of recently released NIC “Executive Survey Insights” data. As Mace explained, “the largest share of survey respondents reported occupancy improvement across all care segments since the survey began.” Specifically, 61% of the nursing care respondents reported an increase or no change in occupancy for the survey period ending the week of July 5. Referring to the increase, Mace commented, “that increase might reflect the fact that we have seen a resumption of elective surgeries in some geographies across the U.S.” Detailed survey results can be found on the NIC Notes blog.

NIC senior principal Bill Kauffman moderated the discussion. In his opening remarks, Kauffman pointed to the importance of contributing and sharing data. “We’re truly grateful to the many operators who continue to provide their data, even during this time of stress. These data contributors are improving transparency, which leads to credibility, and ultimately trust, by educating not just operators and investors, but also policymakers and the general public.”

Kauffman asked panelists BJ Hauswald, Sr. Vice President, Planning & Development, Genesis Healthcare and Ray Thivierge, Chief Strategy Officer, SavaSeniorCare for a brief history of the situation in nursing homes, as they rushed to adapt to the pandemic. Hauswald began her comments with an acknowledgment of the “enormous courage, compassion, and resilience of the American nursing home workers,” pointing out that staff showed up consistently to care for their residents. In response to the question, she reminded attendees that nursing homes house the “oldest and frailest” populations, typically with multiple chronic conditions, and that over 50% of nursing home patients are cognitively impaired. She said, “That makes it particularly difficult for staff to maintain room restrictions and other infection prevention practices, such as masking and frequent hand hygiene.” She also pointed out that, “absent any adequate testing to identify contagious individuals, asymptomatic transmission allowed the virus to spread silently. I think we all know that now to be true.” She explained that swabs and testing capacity were “woefully inadequate” in March and April. Even now, according to Hauswald, turnaround times on results are often 3-5 days, “which renders negative tests for us meaningless.”

huddle8-speakers2
Currently, Hauswald said, “we’re down now to about 700 active cases in about 10% of our facilities.” To date, she said, roughly 20% of the population in her facilities have tested positive or been presumed to be infected with COVID-19, impacting about 60% of the company’s portfolio of properties. “This is not a ‘bad apple’ problem. There are facilities that don’t always practice the appropriate infection control practices, and we can use our surveys and regulations to identify and improve on those, but that ultimately won’t stop the spread of COVID,” she said. “It comes down to community prevalence and the size of the facility itself.”

Thivierge added that “one of the greatest handicaps that society had, but most importantly, our sector, was the great unknown. We had a silent enemy invading our centers…probably way before we even knew it.” He related “that we just simply had no idea (how the prevalence of asymptomatic cases) existed,” which meant that even with policies and procedures in place to screen for COVID-19, workers and essential visitors likely brought the disease in, particularly in hard-hit areas. “We thought we were going to lock down and keep our current residents safe.” He described how, lacking knowledge of how the disease spreads, nursing homes became a “petri dish” despite strict adherence to existing safety protocols.

Today, with greater understanding of COVID-19, things have improved significantly. “Thivierge explained that the industry has come a long way already. “The learning has occurred and the sector has responded…we’ve gotten a lot smarter about how to protect our residents.” Despite these improvements in safety, and signs that business is improving, however, he believes the impact of the pandemic on the skilled nursing industry is far from over. “We also know that the additional impact of the virus on our business is going to sustain itself for quite some time. It’s going to take a long time for us to recover,” he said.

Thivierge shared some data on the impact of COVID-19 on SavaSeniorCare, which has roughly 170 centers across the U.S. The company to date has seen infections in 125 of those properties. Approximately 2,516 of the company’s nearly 10,000 residents have tested positive for COVID-19. In addition, 1,000 staff have been impacted, “that was really devastating to a number of our facilities,” he said. The company has experienced a 20% mortality rate, “but we’ve also seen about 1,500 of those 2,500 folks recover and come back to live in our centers again. That’s a story that the media and the folks who are paying attention right now are not understanding…yes, this virus is really terrible for our frail elderly, but the majority of them are recovering and coming back to our centers to live.”

Kauffman asked how the industry will recover. In response, Hauswald pointed out that the industry is still wrestling with continuing shortages of PPE and testing capacity. She said she welcomes mandatory testing, but pointed out that the U.S. still does not have the capacity for weekly testing of every nursing home resident and front line worker. Further, she pointed out that testing too often takes too long to return a result, and has become very expensive, with prices ranging from $70 to $100 per test. “This really needs to be resolved, and needs to be resolved soon,” she said.

Another issue she highlighted, in terms of making progress, is a lack of a nationwide strategy, resulting in states taking a wide variety of differing approaches. “Right now with everything from testing to PPE to cohorting to resuming visitation, every state has their own flavor and its becoming very difficult to work within that kind of environment.” She also pointed to continuing shortages of PPE and price gouging. “There are rapid increases in the cost of PPE as well…if its not gowns, its gloves. There are constant shortfalls in the supply chain and the availability, generally speaking, from market to market of the PPE we need. We have to get past some of these issues so we can move ahead to opportunities.

To that point, Thivierge added, “We’re also not prioritized. The tests are not necessarily disproportionately being given to those who need them the most.” He called for the sector to bring these issues to the attention of policymakers. “We’ve got a map. We understand what needs to happen to go forward, but to do that is going to require some concerted effort not just on the part of the operating sector, but also those who help control and influence the environment in which we operate.” He went on, saying, “Its easy to sit back and point at things that went wrong. It’s a lot more difficult to point out why they went wrong. To do that is going to require us, as a society, to look at some of things that happened in this period of time, happened because we were set up perfectly to experience what we experienced. If we don’t want to experience it again we have got to work on the way we’re set up.”

Kauffman asked the panelists about the impact of the current environment on their profitability. Hauswald responded that her company is grateful for the federal and state assistance received so far. “We’ve received about $190 million in federal funds, including about $8 million from the sequestration suspension for this year, as well as about $30 million from state FMAP {Federal Medical Assistance Percentages} increases. In addition to that we did access some of the loan programs, the Medicare Accelerated and Advanced Payment Program added about $160 million.” She explained that that program is currently scheduled for repayment to begin in August, and expressed hope for a deferment, similar to that received by hospitals, or potentially forgiveness, “in alignment with what the SBA programs did.” In the long-run, she said, “we need to get our occupancies back up…the good news is that when you’re in such a big hole, the first 5-10% comes back relatively easy. It’s going to be that last 5% that’s going to be a little more difficult.”

For his part, Thivierge pointed to the need for innovation for success in the future, saying, “adversity breeds innovation.” He described changes that have demonstrated potential for future implementation, such as the use of telemedicine. “It was instrumental in helping us ensure that we had consistent practice, and that we were taking care of the residents as best as possible while maintaining isolation and distance.” Technology is also helping residents stay connected to family and friends through mobile devices. He indicated much of what has been learned will improve operations going forward, saying, “they’re going to be head-scratchers, wondering why we didn’t just jump in and do it sooner.”

Thivierge also sees a need for innovation in the design and engineering of skilled nursing infrastructure, such as air handling systems, and other protective technologies now being deployed to combat COVID-19. “The concept of PPE and protective equipment in general has just gotten a lot bigger. In order to create a protective work environment and a protected place to live you’re now talking about infrastructure.” That will lead to increased costs. “To power that infrastructure 24/7 you’re now talking about a significant financial burden. Somebody’s going to have to pay for it…we’re going to have to rethink the entirety of the equation around investment, what it means to invest in our properties, and what the expectations of an investment are.”

In agreement with that point, Hauswald pointed to another factor the industry will have to face. “These facilities were built a long time ago. They weren’t built for this. Now we have to rethink them, not just from a safety perspective, in terms of HVAC systems, but also the configurations themselves. There needs to be reinvestment in this space. If not now, then when?”

During the discussion, both operator executives acknowledged experiencing steep drops in occupancy, as well as higher costs. Thivierge observed that his company was receiving financial assistance in similar amounts to Hauswald’s, and that without that help, “we would not have had the cashflow. There are many other operators out there who would echo that sentiment. At the same time, we know that that’s not going to last forever.”

Looking ahead, he sees long-term impacts. “We’re dealing with an impact to our long-term care base, through this virus, that’s going to take us a long time to come back from.” He described seeing both erosion in the long-term base, and a need to overcome newly stoked fears of the nursing home environment amongst consumers and referral networks alike. “This pandemic has created a mentality in the consumer, and in the referral source, and in some cases even our practicing physicians and others, who are referring people to other locations with the explicit intention of avoiding a nursing home stay. There’s a concern that people in nursing homes will be infected at a higher rate than people who are not in nursing homes. We’ve got a challenge on our hands here, in terms of the perception in the market, and in terms of overcoming the reality of that. Longer-range, those incentives are providing us an opportunity to get through the day and get through this period, but they’re also forcing us to rethink our business model and to rethink what it looks like. How are we going to operate these centers at a lower occupancy and still sustain the level of service we’ve always wanted to and need to provide to our residents?”

Pandemic Strengthens Link Between Healthcare and Housing

Health system takes equity stake in senior living project Prior to the COVID-19 outbreak, senior living providers already recognized the value of forming alliances with healthcare providers. Easy access to good healthcare helps residents live well and longer. On-site clinics and insurance plans for residents have been growing in popularity over the last several years. […]

Health system takes equity stake in senior living project

Prior to the COVID-19 outbreak, senior living providers already recognized the value of forming alliances with healthcare providers. Easy access to good healthcare helps residents live well and longer.

On-site clinics and insurance plans for residents have been growing in popularity over the last several years. But the pandemic has put an exclamation on the point that caring for a frail, elderly population requires close collaboration with healthcare providers. Residents cannot be kept safe without rigorous protocols and the input of experts on infection control.

Two new projects by Belmont Village Senior Living, in Florida and California, are examples of how healthcare partnerships are key today. The projects also show how the healthcare sector has growing appreciation for the value of collaboration with senior living.

In June, the City Commission of Coral Gables, Florida, approved Belmont Village Coral Gables, a mixed-use senior living community. Press reports estimate the project value at $100 million.

What’s different here is that Belmont’s equity partner isn’t a private investment firm or REIT. Instead, the partner is Baptist Health South Florida, the largest nonprofit healthcare organization in the region.

It’s not unheard of for health systems to own seniors housing, but the approach has not been widespread, and the projects tend to be limited in scope. For example, CentraState Healthcare System, a nonprofit provider in Freehold, New Jersey, operates three senior living communities.

Belmont Village Coral Gables will offer 232 apartments for independent living, assisted living and memory care, along with a three-story garage and more than 18,000-square-feet of retail and commercial space.

The ground floor of the new building will include a Healthy Living Center by Baptist Health. The Center will provide services and programs to residents as well as elders in the wider community.

“This is the first partnership of its kind,” said Patricia Will, co-founder and CEO of Houston-based Belmont Village. “Our joint venture was created to reimagine the integration of hospitality and healthcare in seniors housing.” She added that the equity stake by Baptist Health aligns the financial interests and broader missions of both organizations.

The Coral Gables project is expected to break ground in late 2020 and open near the end of 2022. It is the first in a series of communities planned for the region by Belmont Village and Baptist Health South Florida.

Commenting on the project, Will said her company never saw a dichotomy between great healthcare and great hospitality. Both elements are vital to the success of a senior living community.

The pandemic highlighted the importance of Belmont’s dual focus, said Will. For example, a number of years ago, the company partnered with the University of California, San Francisco, to develop protocols to mitigate the spread of seasonal flu.

That collaboration helped Belmont pivot and put effective processes in place to combat the COVD-19 outbreak. “When you have those kinds of partnerships going in, you are better prepared for what to do when clinical challenges present themselves,” said Will.

Collaboration takes many forms

In June, Belmont Village and residential developer Greystar broke ground on a new 17-story project in La Jolla, California. Belmont Village Senior Living of La Jolla will offer 180 units of independent living, assisted living and memory care. Harrison Street Real Estate Capital is the equity partner.

The project is Belmont’s third in the San Diego area. The company already has ties to the University of California San Diego School of Medicine. The new project is located around the corner from UCSD’s main campus.

Belmont plans to collaborate with UCSD’s Center for Healthy Aging which will have input on programming at the property. Last year, the Center launched a study on how to improve the resilience of seniors. Residents at the two existing Belmont projects in San Diego were included in the research. Results show that certain individual activities can improve the resilience of an elderly population. “We can enhance their experience,” said Will, adding that the lessons learned were carried over to residents during the lockdown.

“COVID-19 was life interrupted,” said Will, reflecting on the broader implications of the pandemic. “But we are growing our capabilities through collaboration.”