Presbyterian Senior Living and Westminster Communities of Florida are considering a merger that would result in a combined not-for-profit organization with 54 communities, serving about 13,000 seniors across the full continuum.
With a unit count over 7,100, the merged entity would rank as the fifth-largest not-for-profit senior housing and care organization in the nation, going by 2018 data compiled by industry association LeadingAge and specialty investment bank Ziegler.
Late last week, the boards of the two organizations approved a memorandum of understanding to move the process forward, Trilogy Consulting Managing Principal Scott Townsley told Senior Housing News. Trilogy has been providing consulting services to Presbyterian Senior Living and Westminster Communities as they’ve explored a merger.
The memorandum of understanding lays out an approach to due diligence and the formulation of the “design of the relationship,” Townsley said. This will involve meetings with residents, staff and other stakeholders in the coming weeks.
Leadership of the combined entity is one important factor to be decided. Current Presbyterian CEO and President Steve Proctor is set to retire in June, and current Westminster CEO Roger Stevens is planning to retire at the end of the year. If due diligence proceeds as anticipated, a national search for a new CEO would start sometime this summer, Townsley said.
If the merger moves forward and proceeds according to current timelines, the combined entity would formally launch on Jan. 1, 2020.
The resulting nonprofit would be a major senior living player on the Eastern seaboard, with the possibility of gaining even more scale in the region.
Presbyterian Senior Living is based in Dillsburg, Pennsylvania, and has a portfolio of 32 communities across Pennsylvania, Maryland, Ohio and Delaware, providing a range of care levels and services. In 2017, the organization brought in about $243 million in revenue, with 42% coming from independent living/CCRC/personal care/assisted living, according to its annual stewardship report. Based in Orlando, Westminster Communities operates 10 continuing care retirement communities (CCRCs) and 12 affordable rental buildings in the Sunshine State.
Presbyterian Senior Living and Westminster Communities are both members of the Presbyterian Association of Homes and Services for the Aging (PAHSA), and have a strong commonality in their faith-based approach, Townsley noted. And although they do not have overlapping or even adjacent geographic footprints, they believe that future affiliations with other organizations could essentially fill in the gaps.
There is “intentionality or vision for an even larger organization,” Townsley told SHN.
A Presbyterian-Westminster merger would be the latest in a string of recent nonprofit affiliations, which have ramped up in response to a variety of factors.
These factors include pressures such as workforce challenges and the need to compete with fast-growing for-profit providers. But nonprofits are also positioning themselves to seize on opportunities. They aim to make investments in technology to better serve the coming wave of baby boomers, and to gain the scale and sophistication to partner with health care providers and payers.
“The way I characterize it is, in the last 18 months, there’s been an accelerating trend of strong organizations talking to each other for strategic reasons,” Townsley said. This is different than in the past, when nonprofit affiliations typically arose from struggling organizations looking to align with stronger businesses.
Presbyterian and Westminster in particular are intent on investing in and formalizing their efforts at innovation, Townsley said.
Source: Senior Housing News