The largest organizations in the seniors housing industry expanded their capacity markedly between 1995 and 1996, due to abundant capital availability which fueled significant new development and acquisition activity.
Nearly a quarter (24 percent) of the organizations appearing on the 1996 ASHA 25 ownership and management rosters are companies that had not been previously ranked. The top owners list includes six newcomers, as does the top managers list.
SENIORS HOUSING OWNERS
The Leaders. For the third consecutive year, Colson & Colson/Holiday Retirement Corp. topped the list of the largest seniors housing owners, with a domestic portfolio of 19,101 units in 157 properties. Although Colson & Colson/Holiday Retirement Corp. continues to focus much of its growth in international markets, the company added 13 properties and 1,608 units to its U.S. ownership portfolio between July 1995 and July 1996.
The nation's second-largest seniors housing owner, Marriott Senior Living Services, registered the largest portfolio growth among all firms in the ASHA 25 owner list between 1995 and 1996, adding 3,140 units for a total of 8,600 units in 41 properties. In becoming the second-largest seniors housing owner, Marriott Senior Living Services replaced Forum Group, Inc., which was acquired by Marriott this spring.
ARV Assisted Living, Inc. jumped to the number three position in the 1996 ASHA 25 owners list from number seven the previous year. ARV Assisted Living, Inc. added 1,423 units and now has a total of 5,644 units in 45 properties. ACTS, Inc., for the second consecutive year, held the number four position in the ASHA 25 owners list, with a total of 5,357 units in 15 properties.
The 1996 ASHA 25 reflects a couple of noteworthy trends in the seniors housing industry. One is the growing presence of companies whose core business has historically been in skilled nursing care. A number of nursing home companies are diversifying into seniors housing primarily through assisted living. Living Centers of America, which catapulted into the number five slot on the ASHA 25 ownership roster with a portfolio of 5,267 seniors housing units, is joined by other well-known long-term care companies including Manor HealthCare Corp. (ranked #17), Atria Communities, Inc. (#18) and Life Care Centers of America, Inc. (#25).
Branching out into seniors housing also moved a number of healthcare REITs onto the 1996 ASHA 25 ownership roster. Health and Retirement Properties Trust, the only REIT to achieve ASHA 25 status last year, moved up one ranking to the seventh ownership spot, and is joined by Nationwide Health Properties, Inc. (#11) and Health Care Property Investors, Inc. (#16). The Newcomers. Six companies broke into the Top 25 owners this year: Living Centers of America (#5), Emeritus Corporation (#9), Nationwide Health Properties, Inc. (#11), Health Care Property Investors (#16), Manor HealthCare Corp. (#17), and Christian Church Homes, Inc. (#24).
Ownership Status. Another trend in this year's ASHA 25 is the emergence of publicly owned seniors housing firms. Nearly half (44 percent) of the ASHA 25 owners are public entities or companies that, as of July 1, 1996, had registered with the Securities and Exchange Commission (SEC) to become public. The public companies (and those that have filed to go public) are: Marriott Senior Living Services, Living Centers of America, Health and Retirement Properties Trust, Grand Court Lifestyles, Inc., Emeritus Corporation, Nationwide Health Properties, Inc., ARV Assisted Living, Inc., Health Care Property Investors, Inc., Manor HealthCare Corp., Atria Communities, Inc., and Life Care Centers of America.
For-profit, but privately-held seniors housing owners comprise another 28 percent of ASHA 25 owners and include: Colson & Colson/Holiday Retirement Corp., First Centrum Corporation, Senior Campus Living, Leisure Care, Inc., American Retirement Corporation, Justus Rental Property Management, Inc., and Freedom Group, Inc.
The remaining ASHA 25 owners (28 percent) are not-for-profit organizations, a number of which (such as Retirement Housing Foundation) also own and operate substantial portfolios of federally assisted seniors housing, which are not included in this ranking. Not-for-profit ASHA 25 owners include: ACTS, Inc., Evangelical Lutheran Good Samaritan Society, National Benevolent Association, Covenant Retirement Communities, Inc., Retirement Housing Foundation, American Baptist Homes of the West, and Christian Church Homes, Inc.
Industry Growth Profile. In the aggregate, the ASHA 25 owner portfolio climbed by 13.8 percent between 1995 and 1996, and a whopping 28.8 percent since 1994. Growth within the top 10 owners was equally substantial measuring 11 percent between 1995 and 1996, and 26.6 percent since 1994. The total number of units within the ASHA 25 ownership portfolio increased from 87,705 units in 1994 to 99,288 units in 1995 to 112,991 units in 1996.
The mean portfolio size of ASHA 25 owners has also steadily increased, from 3,508 units in 1994 to 3,972 units in 1995, and to 4,520 units in 1996. Average property size among the largest 10 owners decreased to 120 units in 1996, down from 160 units in 1994. This likely reflects the emergence of assisted living, which is typically offered in properties with 100 or fewer units.
SENIORS HOUSING MANAGEMENT COMPANIES
The Leaders. Colson & Colson/Holiday Retirement Corp. also tops the list of largest seniors housing managers, with a managed portfolio of 19,300 units in 159 U.S. properties. Maintaining its number two ranking from the previous two ASHA 25 surveys is Life Care Services Corporation, which manages 15,268 units in 50 properties. With the acquisition of last year's third-ranked manager, Forum Group, Marriott Senior Living Services moves from the fifth-largest to the third-largest manager with 14,600 units in 69 properties. CRSA, Inc. jumped from #10 in 1995 to #4 in 1996, with the addition of 1,333 units managed, while ARV Assisted Living, Inc., moved from #11 to #5, with an increase of 1,423 units managed.
The Newcomers. ACTS, Inc., which had previously used third-party management for its portfolio of 15 seniors housing properties, now self-manages its portfolio and debuts on the ASHA 25 management list at #7. Other newcomers include Living Centers of America (#8), Emeritus Corporation (#11), Retirement Management Corporation (#12)' Capital Senior Living, Inc. (#13), and Manor HealthCare Corp. (#23).
Management Status. The continued vitality of not-for-profit organizations in the seniors housing industry is evident among the ASHA 25 managers. The large not-for-profit managers are Evangelical Lutheran Good Samaritan Society (#6), ACTS, Inc. (#7), National Benevolent Association (#14)' Covenant Retirement Communities, Inc. (#15), Retirement Housing Foundation (#16)' American Baptist Homes of the West (#24) and Ohio Presbyterian Retirement Services (#25). In addition, a number of proprietary ASHA 25 management firms, including Life Care Services Corporation, CRSA, Inc., Senior Campus Living, Inc., and Greystone Communities, Inc., manage a substantial number of seniors housing units for not-for-profit entities.
One-third (32 percent) of the firms in the ASHA 25 management list are public (or registered to go public). Marriott Senior Living Services is the largest of the public ASHA 25 managers (#3)' followed by ARV Assisted Living, Inc. (#5)' Living Centers of America (#8), Grand Court Lifestyles, Inc. (#10), Emeritus Corporation (#11), Retirement Management Corporation (#12)' Atria Communities, Inc. (#22), and Manor HealthCare Corp. (#23).
Industry Growth Profile. The management portfolio of the ASHA 25 tells a story of steady growth between 1995 and 1996. The top 10 firms managed portfolios in 1996 that were 10.9 percent larger than the previous year, while the top 25 management portfolio growth increased by 10.3 percent. The total number of units within the ASHA 25 management portfolio increased from 115,125 units in 1994 to 124,671 units in 1995 to 137,494 units in 1996. The mean management portfolio size of ASHA 25 companies has increased from 4,605 units in 1994 to 5,500 units in 1996.