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JOHN P. RIJOS: So I spent 25 years in the hotel business and enjoyed it. It was what I was trained for coming out of Cornell. But after 25 years of it and being an owner/operator/developer, I really felt like there was more opportunity in a kind of same-skills-related related field that was the beginnings of senior living.
And what I really felt was that senior living was in its beginning, embryonic years and had tremendous opportunity. It was at the vortex between real estate, hospitality, and health care but didn't have any professionalism in any of those three businesses. And I felt that the skill sets that we had would translate well and that, over time, we could build a really hospitality-driven senior living business that would be a lot more acceptable and, through education, would be a lot more interesting to seniors and to their families.
Back in 2000, my mom and dad had both been sick in the prior year. They had both passed away from different forms of cancer. And, quite frankly, as I watched their end of life come, I thought it came without any dignity and without an environment that was supportive in a congregate care type of environment. And that kind of got me thinking much more soon than I probably would have otherwise about senior living and the ability to create a passionate, enduring, ongoing way of life for seniors that both had some certain needs-- certain activities of daily living that had to be provided for them-- but also just wanted to be purposeful and energized and live a fuller life. There's no reason, just because you're 80 years old, you can't live a full and complete life.
Brookdale was 16 communities when I took it over in 2000. We went from 16 to 50 to 100 to 300 communities. We went public in 2005 at about 400 communities and about $2 billion of market cap. When I retired from it two years ago, we were 650 communities and $4 billion or so in market cap.
All of those are great numbers. You know, it is the biggest company in the industry. But we never endeavored for it to be that biggest. We just really wanted it to be good and better than the rest of the competition. And what was exciting to me was building a business that was based around hospitality and health care-- clinical needs-- and blending the two in ways that were important.
Families are at a point when Mom has needs that need to be met. They're at a point of enormous anxiety. And they just don't know what to do. And not knowing what to do creates panic for every level of a family, both the prospect-- the resident-- and the adult daughters and the grandchildren. And the whole family winds up in flux. And to create an environment that was educational, that showed that Mom would live longer and healthier and happier with a more fulfilling and purposeful life, that she could engage on many levels that often had left her life because of death and loss of friendships-- that was what was exciting about it.
So, yeah, we serve food just like hotels. We have activities and things for people to do every day, purposeful opportunities just like in any hotel. So we don't serve margaritas on the beach. You know, we serve just, you know, good, healthy food and try and keep people very healthy. But all the same skill sets that are in hospitality are in senior living. It's about activities. And it's about spiritual engagement and emotional engagement and social reengagement and providing great clinical care and providing good housing and creating a safe and trusting environment not only for the resident but for the whole family to feel good about.
One of the great things for people that have a hospitality background is, if you're a hotel general manager and you work 80 hours a week and you work every holiday-- you work every holiday period, you're working when other people are playing. And if you're a chef, you know, you don't know how many meals you're going to serve that night. And you hope things go well, and you prepare for that. But it's always a crapshoot.
And one of the great things about senior living is there's a lot more predictability to do the job. And there's more times that people can spend with their families. And, you know, there aren't many people that are up and about at 10, 11, and 12 o'clock at night. So most functions are finished and done with by 7:00 o'clock. So people can have a personal life that are in the business.
And it pays very well. In fact, the truth of the matter is most people wind up spending 10 or 15 years in the hotel industry or the restaurant industry, burning out a little bit and finding that senior living does all of those things that they like doing and have passion around but does so in more reasonable hours and better pay.
I retired from Brookdale two years ago. I had spent, you know, 25 years in the hotel industry, a little over 13 at Brookdale. It was a big, public company-- is a big public company. And I'd had enough of that.
You know, at my core I'm an entrepreneur. And so I took some time off, came up here and taught at Cornell, and decided to kind of replicate what we did at Brookdale the first few years, where we took a small company and, through great services and great hospitality and pretty good marketing, built a company that we were proud of. And so I wanted to do it again privately. So we created Chicago Pacific Founders, a private equity fund that's specifically in health care.
And a big portion of that fund is invested in senior living through me. And we're excited about it. So we've only been in business for, I don't know, about a year-- a little over a year. And we already have six communities that we own and a management platform that we've purchased and grown and quite a few deals in our pipeline.
So we feel good about it. And the good thing is we can do it at a pace that we feel comfortable with in terms of growing it. And that's important to me. This is my third act, and I intend for it to be my last one as a working person.
ASHA's the American Seniors Housing Association. It's the industry association for the senior living industry. And it gets involved in accreditation. It gets involved in public policy. It gets involved at the federal level with policy but also is kind of the c-suite organization for all of the senior living companies and the lenders and the developers for all of them to kind of come together in a networking way.
One of the things that we're doing at ASHA is looking for new directions and new ways for us to lead the industry going forward. And that's one of the reasons that we're getting involved with this Institute for Healthy Futures here at Cornell.
You know, this all started back in 2007 or so when I spoke at the Dean's Distinguished Lecture Series. Then we did some roundtables on health care. Then we started the senior living class up here at Cornell. And the fact that it's now to the level that it can become a real institute and do forward-looking research, create publications for professors and white papers that will be helpful to the senior living industry as well as all of health care-- that's exciting for us to be a part of that at the beginning at ASHA.
Now, speaking specifically to the hospitality students, I would say that internships are abundant in senior living. You know, Brookdale obviously provides internships. So does Sunrise. So do a lot of the private companies. So do the public REITs like Welltower and Ventas. So there's plenty of opportunities to get summer internships, paid internships.
And it gives people a chance to look at many different parts of what the industry could be to them. You could be in operations. You could be in culinary and dining directly. You could be in the clinical gerontology side of the business. You can be in the real estate underwriting acquisition side of the business. So all of the things that you can learn and go into in the hospitality industry, you can also do all those same skills in the senior living industry.
So, first, they should start by taking some classes in senior living. They should think about internships. And then, from there, look at what the opportunities postgraduate are. And kind of compare them side by side with the rest of the hospitality opportunities.
One of the exciting things about senior living is it pretty linearly goes up year after year after year. If you just think about the demographics of it, you've got, you know, 19 million seniors that are 75 years of age and above. The 80-plus age is the fastest-growing cohort in America. They're living longer with more physical limitations, more chronic conditions.
So the need for more senior living is always going to be there. Whether it grows by 3% a year or 5% a year, it's always going to grow. And what that does is it creates a real solid foundation for the industry going forward.
The hotel industry has booms and busts. And I've probably lived through 15 of them in the last 30 years. It's great business. But, you know, it doesn't have the stability that senior living has. At its worst, in 2008 during the Great Recession, the senior living industry was down to 86% occupancy-- the whole industry-- and it's now right back up at 90% occupancy and probably going to grow from here.
Hotel careers-- I mean, I was in it for 25 years. You spend a lot of time being an apprentice, generally. And there's a lot of people in the industry. In the senior living industry, even though it's gotten fairly big-- it's, you know, 1.9 million units across the country-- it's still fragmented. It's still embryonic. And it's still an enormous opportunity for people to become entrepreneurs early in life.
So, A, you can grow pretty quickly in the business if you want to be on the operational side or on the finance side. But you can also have a fairly clear pathway to become an owner, to become an operator because building a hotel costs hundreds of millions of dollars. To build a senior living community, it's a lot less expensive because they don't have to be 300 units. You could build a 50-unit senior living community for $5 million. You can borrow $4 billion and raise $1 million between friends and family. And you can be in business once you know the industry.
So another way to get into the industry is through ancillary services. You know, you see home health agencies starting up all over the country-- small physical therapy, occupational therapy, speech pathology companies. You know, they start up in the back of somebody's house, so lots of opportunities in that ancillary side of the business, as well.
I just think it's a great business. And as chairman of ASHA, kind of I see a lot of what the future looks like. I see what the technology changes. I didn't even mention technology. But in the areas of seniors in technology, the next 20 years is going to be life changing. And there's lots of opportunities in that area, as well. So, if you want to become an entrepreneur, if you want to grow quickly in an industry, if you want to be a leader sooner in life, senior living is probably a pretty good option.
The Cornell Institute for Healthy Futures conducted an in-depth interview with John P. Rijos '75, co-founder and operating partner of Chicago Pacific Founders. John is also chairman and chief executive officer of CPF Living Communities, the company's senior-housing subsidiary.
