In this episode of The Roots Podcast by 12 Oaks, host Greg Puklicz, President of 12 Oaks Senior Living, sits down with Travis Wick, Regional Vice President, to unpack the strategies and heart behind serving the middle market in senior living.
From his unexpected start in the industry to leading thriving independent living communities, Travis shares how 12 Oaks is redefining affordability, access, and quality of life for residents who might otherwise be left out of the senior living conversation.
Together, Greg and Travis discuss how the middle market model delivers value through smart operations, strong resident relationships, and innovative care partnerships that extend independence and length of stay.
Produced by Solinity Marketing.
Intro 00:00
You’re listening to The Roots Podcast by 12 Oaks, where we’ll be joined by industry leaders to discuss and highlight the character, competency and care that is required to successfully manage senior living portfolios.
Greg 00:13
Hello again, and welcome to yet another edition of The Roots Podcast, brought to you by 12 Oaks Senior Living. Today, I have one of my very special guests, one of our most famous and accomplished regional vice presidents. Welcoming in studio today, Mr. Travis Wick. Welcome, Travis
Travis 00:39
Too kind, Greg. Too kind.
Greg 00:41
It’s very super exciting to have you here to showcase your skills and talents to your many fans around the globe. Today’s topic is something that you’re a subject matter expert in, and that is the middle market. But before we dive into that, I’m always fascinated by people’s stories, origin stories about how they got into senior living. So why don’t you tell us a little bit about how you got into senior living and your meteoric rise to RVP?
Travis 01:16
It started probably about 25 years ago that I got into senior living. I was in the restaurant industry, went to culinary school, decided that that probably was not for me a few years after getting out of school. However, I answered an ad in the Sunday paper back before the internet and drove 35 minutes to a job interview and pulled up, and lo and behold, there was a senior living community and I did not go to school to cook for old people. I contemplated not going in, but I had driven that far, so I did go in. The executive director liked what she saw. The regional did not. He didn’t like the fact that I didn’t have any senior living experience. And so the story goes that they flipped a quarter and she won. And so that’s how I got into senior living about 25 years ago.
Greg 02:04
Well, that’s awesome. That’s kind of like No Country for Old Men, a little bit of a story there with the journey of the coin. Did you keep the quarter?
Travis 02:12
I did not, I did not.
Greg 02:14
We’ll you need to get that quarter, and we need to mount it in your office, your lucky quarter.
Travis 02:19
That would be pretty cool.
Greg 02:20
That would be cool.
So, the middle market: let’s talk about independent living, the middle market. So what’s your definition of IL middle market?
Travis 02:32
Middle market, to me, is an underserved group of people in the community. Seniors that can’t afford to go to a place that costs more and takes more resources that they just don’t have. These are the blue-collar workers, and of course, talking about one of our properties in Irving, of the area. We do a service that others can’t match, and the residents are thankful for it.
Greg 02:59
So I know generally the market defines middle market as something less than class A or class B facilities. But I think that’s a bit of a misnomer because it’s about price point. And given the great reset of real estate values post-COVID, we’re seeing significant opportunity for basis resets in communities changing over. And we saw that at West Fork Village, and we saw that at the Emerson in South Collins, another property in your portfolio. And we’re about to embark on a third, very similar opportunity in another Texas market here in Q4.
Help us define what is the profile of the resident and what are kind of the rent levels you’re seeing in the middle market, and why are those rent levels appropriate for the residents that we’re serving?
Travis 04:04
The type of people we see are retired teachers, retired blue-collar workers, they work in factories. They didn’t necessarily have the means to set themselves up for a comfortable retirement. And so they worked until they couldn’t work any longer. A lot of them are on government-assisted Social Security. And so they use a lot of their Social Security to live where they live. And as far as why does it work? The average rate for a one-bedroom apartment in Dallas right now is $1,762. We can do that same one-bedroom apartment for less than $1,500 while giving them something to eat three times a day, entertainment as well as transportation so they don’t have to have a vehicle, and they can still get to their doctors. And speaking of doctors, we also have doctors that do come to the community so that they don’t have to travel. All kinds of doctors, pathologists, dentists, doctors, home health, and hospice if they need it.
Greg 05:05
I mean, the value proposition is enormous for the residents. The real estate merchant developer in me hears that rent level and wonders, how do you earn a margin? How does the community survive at such a low rent level?
Travis 05:23
These communities it’s based on volume. And so the more people that we have that live there, the more that we can actually give discounts to. And so we still do make a tiny little sum to cover costs there. It’s not going to be a $1 million a year property, but it’s serving people who otherwise would have been left out and possibly could be homeless.
Greg 05:45
Let’s dig into the OpEx a little deeper. So you’re providing three meals a day. How do you control food costs, and what do you see your PRDs at for these types of communities?
Travis 06:00
Our PRDs range in the mid $5.50 per person per day. The way we’re able to do that is through a cafeteria-style of dining service model. It prevents waste basically, because people are only taking exactly what they want, and so anything that might be left over is just put back on the line and somebody who might have had one of the different options might want that same option. And so we are still able to give all the options that any other community might be able to have. Of course, it might be more casseroles and things that you would see in this type of market. We’re not having a filet mignon, but this is not the group of people who had filet mignon and want filet mignon.
Greg 06:40
So I imagine, given the cohort and the makeup of the residents, there’s going to be plenty of, in Texas, at least, chicken-fried steak, catfish, fried eggs. Right? So low cost, easy to prepare, and easy to recycle, type food choices.
Travis 07:01
Absolutely. And it’s interesting, but there’s not a lot of complaints in the dining area, even at that dollar amount.
Greg 07:07
Right. So people get what they want, and they get as much of it as they want without any waste.
Travis 07:12
Right.
Greg 07:13
So what do you do for staffing then, too, in terms of servers and that type of thing?
Travis 07:18
Our staff there is great. And I want to talk a little bit before getting into the servers. Our directors alone, six directors, have 76 years of service in that community. That’s how long they’ve worked there, and that extends all the way down to the line staff. So we’ve got a housekeeper that’s been there over 25 years. We have someone in the kitchen that’s been there almost 20 years, and that’s what translates to the happiness of the residents, because the staff really know the residents. And I think that’s what differentiates us from other models.
As far as what we run in the dining room, we do have servers that help, but it’s not a ratio of 1 to 30 or what you would see at a normal restaurant or even another senior living community, because as an independent living community, most of our residents can get their own food and take it to the tables and then take it to where the bussing stations are.
Greg 08:11
We see that in the OpEx of these IL communities that you’re running. And one thing I would say is that we are consistently on budget and OpEx. You’re doing a great job in working with the onsite staff to manage those expenses.
As impressive as that is, what’s even more impressive is the lease up success we’ve had in a couple communities here this year, specifically West Fork and Emerson, and Arlington. Those are communities that have come out of the 60, 70% kind of occupancy levels to, in the case of West Fork, about to punch over 90%, and you’ve gotten Emerson to well over 90%. What’s your secret that you want to share with your fans?
Travis 09:02
The secret is we don’t target households. We target apartment complexes. That’s where I see our competition is, people who already live in an apartment. And if we can provide the same services, better services, more services than what they’re already paying, then it’s a no-brainer. And that’s why they end up moving to us. In fact, we’ve been able to become the known place in the community that we really don’t use referral agencies anymore unless they are locals and somebody that we know can work with us and keep the cost down to underneath a month’s rent.
Greg 09:39
So you’ve been able to do this lease-up without referral agencies?
Travis 09:44
Well, it starts with the referral agencies as partners, but, yeah. As you get over 90%, we started cutting out the referral agents, and we actually saw that our census continued to grow without them. And so not only were we making more money because of census growth, but we were also saving over $100,000 by not using referral agencies in a year.
Greg 10:04
Wow, that’s significant.
So you mentioned home health. Tell me more about the integration of physicians and home health in the communities, and what impact that has you believe on the length of stay and resident satisfaction, and wellness?
Travis 10:23
As far as length of stay, an average IL community will lose about five residents per 100 every month. We’re averaging around four for 170. And the way we do that is through home health, doctor visits, where they don’t have to go. But we also pair that with some learning courses for the residents, whether it’s financial planning, Medicaid, Medicare, to get them to the doctor, even though they probably wouldn’t have gone unless that doctor was there at the house. And same with the hospice and home health. Home health office is out of our building, and so they’re able to provide care and help to the resident. And so our average length of stay right now is about 28 months at this community.
Greg 11:10
And what is the cost to the resident for utilizing the home health services?
Travis 11:14
Usually they go through the Medicare or Medicaid. And so there’s not an out-of-pocket cost.
Greg 11:19
So the model is they’re able to pay their rent, get all their meals and activities, and transportation, but their health care needs are met through home health at no additional cost to them. So a transfer to AL would be a huge cost increase to them. They may not have the means to be able to afford full AL living. And so keeping them in this IL setting is a really good way of extending their length of stay. How do you find the acuity levels of your residents then at the communities?
Travis 11:57
It’s mixed. And we do have people that possibly are on the verge of having to move to an assisted living. And that’s when we step in with the family to get with the physicians, to ensure that either A) can they live there and still be safe. That’s our number one concern. But also, what help can we get them to extend their stay? Because if they’re not living with us, there’s usually only two, well, three choices. One is to move back home. And unfortunately, a lot of these residents that we have just don’t have family. So that’s not an option. The second would be to get into a full government-assisted living. And then the third option would be homelessness.
Greg 12:39
Well, obviously, that’s clearly not the option we want.
So I think holistically, and I look at 12 Oaks and our opportunities. Our mission is to help seniors thrive in community. The middle market, IL, is certainly one of the best places where we really have an impact. I know we have a lot of social events at the communities, and we use those as kind of an outreach deal. And, I would say the mid-market IL communities are some of the most vibrant, interactive, engaged populations of residents we have anywhere.
Travis 13:23
Oh, absolutely. They know how to throw a party.
Greg 13:26
That about wraps it up today for today’s episode of The Roots Podcast. I want to again thank Travis Wick helping us dive into the middle market, IL, 12 Oaks’ position, in that led largely by the efforts of Travis. Travis, thank you very much.
Travis 13:46
Thank you for having me today.
Greg 13:47
You bet.
Outro
We hope you enjoyed this episode of The Roots podcast by 12 Oaks. Get connected with us on social media and at 12oaks.com.