We had the pleasure to sit down with Brandon Schwab, the owner and founder of Shepherd Premier Senior Living. His vision is to improve the senior living industry forever by providing a better way of delivering quality care that is resident-focused, not bottom line-focused. Some would call him a disruptor and others would call him a visionary. He prefers to be thought of as a passionate businessman that recognized a problem and wholeheartedly pursued the solution.
He quickly realized that this was his purpose in life. Everything else he's done left him empty or always seeking more but in reality, it prepared him for Shepherd Premier Senior Living & the boutique senior living niche industry. Caregiver to resident ratios of 1:15-20 as the national average is unacceptable. Brandon believes it needs to be changed. His boutique senior living model aims to provide 1 caregiver to every 5-8 residents. The better caregiver ratio directly equates to better care provided to residents.
Join us for this informative review of a senior housing model that is spreading across the country.
We had the pleasure to sit down with Brandon Schwab, the owner and founder of Shepherd Premier Senior Living. His vision is to improve the senior living industry forever by providing a better way of delivering quality care that is resident-focused, not bottom line-focused. Some would call him a disruptor and others would call him a visionary. He prefers to be thought of as a passionate businessman that recognized a problem and wholeheartedly pursued the solution.
He quickly realized that this was his purpose in life. Everything else he's done left him empty or always seeking more but in reality, it prepared him for Shepherd Premier Senior Living & the boutique senior living niche industry. Caregiver to resident ratios of 1:15-20 as the national average is unacceptable. Brandon believes it needs to be changed. His boutique senior living model aims to provide 1 caregiver to every 5-8 residents. The better caregiver ratio directly equates to better care provided to residents.
Join us for this informative review of a senior housing model that is spreading across the country.
Welcome to the senior housing investor podcast. If you are an investor or want to be an investor in senior housing, then you're in the right place. Hi, I'm John Hauber of Haven Senior Investments. We are pleased to present our newest episode where we bring you the innovators and leaders across the full spectrum of assisted living in senior housing, all of whom provide for the betterment of our senior population. The host of our show, Pamela Pyms has background in the industry. And she will be interviewing our honored guests.
Pam Pyms:Hi, Pam. Hi, john. Thanks very much. It's great to be here. Today, I'm delighted to be here with Brandon Schwab, who's the CEO, and founder of Shepherd Premier Senior Living. Hi, Brandon, how are you? I am awesome. That's what we like to hear. Thanks very much. How are you doing today? I'm good. Thanks. But tell me about yourself. And what got you interested in started Shepherd Premier Senior Living?
Brandon Schwab:Well, that's a very good question. I was actually I first got exposed to the bigger box buildings to care for the elderly. Back when I was about 28 years old, just my grandpa, he was in a bigger 200 bed building. And I didn't have a very awesome experience. And I was able to push that down deep. But after I had the opportunity to get exposed to an avenue for homes that are five to 10 different beds each, I was able to come back to that first experience that I had, he had to have help, right. And our family pulled the pole cord button, and it took the caregivers time. And after 510 15 to about 20 minutes, I was getting pretty upset. And I ended up having to go get the care team to be able to help him because his face, it was able to change change colors. And he was able to get pretty upset that he didn't have anyone to help them. So that experience plus the typical older piece that I don't think you were able to get off of you in a typical bigger box building for time, right? All of those factors combined, I didn't have a very good first experience in a bigger type building to offer care, right. And then to just fast forward, I was in church in 2014. And it was a one of those church type of times where the church pastors only able to talk to you. Back be for that I actually had a portfolio of homes. I had 23 homes. And I had tenants in all of them
Pam Pyms:to not senior just normal homes. Uh huh.
Brandon Schwab:Wow. And I thought I was doing good. I mean, I was taught to go build a portfolio of homes on them for 25 to 30 years, and all things are good. They didn't tell me though, that tenants are very tough, right? I had a tenant just before this event for church, that her kid clog all three toilets in all of our in that whole home phone to the point that the finished basement backed up with poop. Oh my goodness. So I don't know if you ever had to do that. But like that pretty much pushed me over the edge. Wow. It was a type of experience that this gal was into us for almost $8,000. And I did it all personally. And it took me all day long. And it was terrible. But afterwards, that opened up the eyes that there had to be a other option out there that I was able to help people but also to do it in a opportunity that I could earn the in calm that doesn't always have to have me in each house every day. And after that I was at church and the church pastor was talking to us and and after I heard that I was down in down in Florida right down by Tampa. I pulled our boat down to Florida and and Kelly's dad. So our father in law he played The piano at 328 homes per year. Wow, for $35 each. And at this point, I was like Kelly, is there anything that I can do that I don't have to build a go in? Because typically down there in Florida, they typically are able to, to have them go up right 10 to 12, just floors of the elderly, and the odor was terrible. I hate it. And Kelly gave me all of her eyes that i i did i didn't have any option, right? Yeah. So I ended up going, and I was able to go into a home that had about five people in there. And so I was like, Oh, my God. And I haven't ever been exposed to a actual home that cared for the elderly. And it didn't have the typical odor that is in all of these homes. And, and I just found the experience to be totally different than I've ever seen before. So I was able to ask that person to, to be able to tell me extra info on it. And I ended up going home, thinking that as I was able to get home that they that they probably had all of these types of homes all over the place, right. And I came home to find out that there was only about 55 of them through all of our area. And I said that's an awesome opportunity. You bet. So I jumped in. I opened up our first house in 2014. I opted to have 10 beds in our first house.
Pam Pyms:Hmm. Was that private rooms or two beds to a room? Or?
Brandon Schwab:Well, I had four private bedrooms, and I had three bedrooms that had two people in it each. So 10 total beds, but I had four private bedrooms in three bedrooms for two people. Okay. Yeah. So that's how I was able to get into it. It is a thing that I was able to get into it to be able to help because I felt that the other bigger box buildings aren't the best platform to give awesome care. And particularly I think, I think today pose COVID everyone in this country is open to any other avenue to offer care. That isn't in a very big building. I had found that through COVID, our our occupancy was able to go up. And quite a bit of the other bigger box buildings in the area, their occupancy was able to go down. I had found that during COVID people were taking their parents home, particularly because they didn't have to be in the office. Right. Right. So but I found that all of our homes, they were a very good option. And I actually had occupancy up during 2020.
Pam Pyms:That's amazing. Were you able to I'm just curious. Are your rates the same? per person as they would charge in one of the bigger boxes for assisted living? I'm assuming you did assisted living, not memory care. Mm hmm. And how did your rates compare?
Brandon Schwab:So a thing typically for all of ours is I charge a price that is going to include everything. I had always kind of felt that if you offered a person and upfront price and then added things to it each month I've I was felt that it was hard for the families to just figure out how they could plan for all of that. So our prices are basically charged per private in per double bed. Right?
Pam Pyms:Right. So you do have a combination that of say private pay, and do you take Medicaid for the double rooms.
Brandon Schwab:Well, all of our houses are typically private pay, but I do have private bedrooms that are anywhere from six to 8000 each month. And then I have got bedrooms that have two people per room that are about 5000 to about 6500 each. month, and then they can
Pam Pyms:split that
Brandon Schwab:No, no, that is per that's per person I see are over all business is different. I mean, I have people that are in that are going to have their own place to be in the evening time, right. But I encourage people to be up and out, I am able to custom build tables. So everyone needs to gather, I feel it, that's a key piece of our operation that puts us apart from everyone else. Because typically, if you go to these huge buildings, they have tables of you know, about four to about five people each. And they only talk to those people every day, over and over and over in it in it on fortunately, is going to create an atmosphere that they kind of only talk to those people in all of our homes, I I typically have homes that are 10 beds to about about 15 to about 20 beds, tops, that is able to purposely create an atmosphere of a very cozy place that they all eat, too. So So everyone's gonna eat, and well, they're gonna eat at a big table, right? Sounds like a sorority or fraternity. Kinda like going back to once you throw. Yeah, that's great. That's great. It sounds really, really cool. I want to ask you more about it. But But I really also want to know how you got the name or why you chose the name Shepherd Premier Senior Living. Shepherd Premier is, I think, a best term to describe the type of care that our business is able to offer. I, I feel that it is our job to help the everyone that is in our homes, have the best final, the final, the final chapter, per se, but then also help answer questions because a thing that I have found, and as I was at that first church, the pastor, he was gone, he is going through just Psalm 23. And I felt that that hit our heart properly, that it was our calling to to create an atmosphere, that the care that the caregivers get to hear everyone write. And they get to hear those questions that people are able to begin asking towards the end date. A person who is at 85 and isn't doing great is going to be asking the places that they are able to go after Earth, right? Mm hmm. I purposely built a home that was able to hear those those questions, and is able to get the answer to help people be able to answer that tough question before they are able to pass.
Pam Pyms:That's really cool. I know. The first line is the Lord is my shepherd. Um, yeah, yeah. That's I love that. That's really cool. Well, what would you say then would be a besides what you've just said the most important say one or two things to know about the senior living market today.
Brandon Schwab:I think people typically think of the industry as its it is very difficult to build a get into it. Both. If you are interested to invest, that it typically takes a big quantity of cash in order to invest. I would be able to help open their eyes, how things are going today, things are different. The typical bigger type building that has 200,000 plus feet, right. And I think the average cost of those buildings is a buck $58.2 million per building, right? I think people typically think that they can't get involved if they don't have you know, hi, just six to eight plus to invest, right? I would be able to challenge that things are gonna be different today. I feel that post COVID the bigger box buildings aren't going to do as well. They aren't going to do as well because people aren't going to be as comfortable bringing their own parents to all of those bigger buildings and the other piece point out is that because of that, the business caring for the elderly isn't going to be all of these huge buildings that are basically built for big corporations to earn tons and tons of dollars, because at the end of the day, they build a 200,000 foot building for the elderly themselves, or did they build the giant just hallways to put tons and tons of actual people in there, right? Mm hmm. But to think of it as the industry is going to be able to change. I mean, if you think about the taxi, the taxi in the taxi cab industry, didn't have to do anything different for 1020 3040 years, right? They, they pretty much owned it. Okay, they did. And then came a company called Uber in turn the taxicab industry upside down. And if you think a bout a Pam, all they did is they had an eye, they had a good eye, dia and they also use technology. And they basically changed the whole taxi cab industry. Boom. Okay. I feel that the industry that all of us are in all these big, huge buildings, that 80% of all of these, all of these huge buildings are owned by 20% of the overall operators. Right? Right. They own a ton of them all of these big giant corporation. Do you know that the average, the average care, the coast to coast care, giver hassle care for 15 to about 20 people?
Pam Pyms:Is that right?
Brandon Schwab:How do you expect a caregiver that's getting 12 to about $15 per hour to care for 15 to 20 people, particularly if the code is going to have you check and change them every two hours? How is that possible? Pam?
Pam Pyms:Well, I think that's why there's such a problem with staff and some of these bigger buildings, especially when there's a McDonald's down the street that will pay $14 an hour. It is a real conundrum to think about how many people are, you know, just in one person, one person's responsibility, as you say? Yeah. I think you asked a very good question. They're very good question.
Brandon Schwab:But don't you think that is everything though? Because if the care giver cannot do her job, and the issue is that in the actual care giver, it's the owner and operator that's choosing to put the caregiver in a place that they just can't do well in. And I don't think that is fair. Mm hmm.
Pam Pyms:Well, it's certainly not fair to the resident. If they're understaffed. That's, that's for sure. Mm hmm. Well, I noticed on your LinkedIn profile, that you've also started a fund called boutique Senior Living fund. Tell me what that's all about?
Brandon Schwab:Well, I will tell you I have opened up by pomes over the past over five homes since 2014. And I'll tell you, it's been very difficult. I found that banks haven't been open to offer capital to us. And it's been very, very difficult. I'm at the point now that our business is able to gain traction, I'm actually a, I'm at a point to close on a a group of homes by August 1 this year, that's going to take us up to 12 homes and 100 in 125 beds. But our biggest challenge to date has been accessing capital. And I felt that I am able to use the the experience that I've had to bring investors in to an open Capital Fund. People who are interested in being able to help the elderly, right? I mean, if you've got capital to invest, the investors are going to be interested in finding a place to earn a good ROI, right? But also, they are interested in the M pack of their capital being being parked into a asset class that is able to be able to actually that is actually able to help, okay, and I feel that this is the ultimate build good investment, right because you're able to earn a good ROI. But coupled you're able to help the elderly, but I I opened up this fun because I feel that there are other people coast coast that are in this country who are interested in being able to help, but they don't have access to capital, right? Or they don't know how to purchase a home or to do everything. This capital fund is going to be a turnkey avenue for operators coast to coast. To get into this business, I'm basically targeting the healthcare Rn, who has been in the healthcare world for 25 plus years, who often comes up to us in and is able to go, Brandon, how did you ever How did you ever open up these homes like I have been thinking of available to do this for for 2530 plus years? I am, I am going to help investors place capital into 510-510-2080. Homes, right? Wow, that are going to help care for the elderly in an atmosphere that each caregiver only has to care for five to eight people. That's it, I, I am only going to place capital into homes that are 10 1520, homes tops, I don't do anything over 20. Because I feel that these big buildings, the bigger type buildings aren't for everybody. And I feel like that the Uber of this industry is going to be who can build and operate and control the biggest quantity of homes in a actual house the care for the elderly in to be able to give awesome care. That's the plan of our font. So I am so I am looking for our friends who are interested in opening up a home up to two homes or three homes, tops that they are able to own and operate in be an actual an actual partner of ours to actually operate homes coast to coast with us.
Pam Pyms:I think that's a brilliant idea. Thank you. Let me ask you about the homes themselves. Are they already existing homes that you sort of go in there and do a little rehab? Or do you build ground up?
Brandon Schwab:That's a good question. Um, I do I do all of them. Right. How I have opened is I have a very big experience to take homes that are up currently and turn them into this purpose. I also am able to, to be able to build homes, as well. And then I'm also purchasing properties that are in this particular business that are up and operational. In particular, the owner is older, they have they have been doing it for 510 20 years and they are interested to exit I am basically building a huge portfolio of homes coast to coast to basically put things together and then have a plan to go coast to coast to help change the industry caring for the elderly. today.
Pam Pyms:I'm gonna call you disrupter. Brian, I mean, Brandon.
Brandon Schwab:Yeah, yeah, it's it's, I was able to get into this because I, I have the overall all over all purpose, that I think there's an opportunity to do things different. And I and I feel that our business is in a awesome asset class that's going to get people who are interested to invest, particularly today, there are investors that are paying banks to be able to hold their cash, right, that tells you that people are interested in in, in having their capital into asset classes that are able to earn them a bit above average ROI.
Pam Pyms:So what kind of give me a range of what type of return you're able to offer these investors and, and maybe the minimum amount that they would have to invest with you.
Brandon Schwab:Well, I would have to be careful doing that just because it isn't for everyone. I'm targeting folks
Unknown:The, the ROIs, I have got a fund that is both debt and also equity. And then I have a fund that's going to be anywhere from eight to 12% typically and that is backed by the asset, I can typically hit IRR of 14 to about 15%. I mean, everything is up in the air, it depends on a each per each particular deal. But a thing is awesome on this particular fund is this fund is going to have a bunch of homes together. So, back before I saw as a open up homes, right, but in this particular bond, they are giving capital to open up to 2, 5, 10, 20 different homes. So across that whole portfolio, these properties are able to perform and earn dollars. Now, that's good, because if anything, if anything ever happens, it has the overall portfolio to put it across. So it is best to to have to have people call me I have it all. I have it all online too.
Pam Pyms:Hmm, I'm sure they can go there do you say you want to go from coast to coast? First of all, tell me and the fact that you've done five in the last like five or six years, that's pretty incredible in and of itself. Tell me how you search for where you'll put these homes, and how you'll manage them across a large, large area.
Brandon Schwab:So our plan by 2025 is to focus in our area, first I would targets so I would target our part of the country. And then I would go out a bout eight hours right? After I have 30 homes per MSA, totaling about about 300 homes, I am then going to go coast to coast after that. After 2025 I am targeting areas that the elderly are at currently. And it doesn't always have to be areas that the elderly are typically that people think that they are typically at. So Arizona, California, all those areas have ton of these homes, right? I'm targeting areas that aren't as as common for these homes to be at. And I am targeting the average household income of about 80 80,000. Plus, I am also targeting areas that the that the population older than 65, or over 10 to 12%. And I am targeting areas that that there has been a expansion by the other bigger box buildings and I'm fine the end the Burger King of the industry. So I don't have to, I don't have to be able to go there first. But I will find dirt in the area and our average time to go from dirt to diapers is about under two years. Right?
Pam Pyms:Is that is that building from the ground up that you're talking about? Mm hmm. Do you do you ever run into any code restrictions, like you have to have a certain number of bathrooms to meet a certain number of residential Is that why is easier to build than sometimes just buy a home unless it's unless it's a home that's already been repurposed for this.
Brandon Schwab:So I would tell you it is easier to build because you can build the absolute perfect asset However, it's hard because that's a very cash and that Avenue is very expensive. I typically like to put about 30 but 30% down, and it's hard for people who are just getting in to put that type of capital down. I've got a current project that I'm building 120 beds total. It's 20 beds per home. But before COVID our costs was 15.5 for the entire project and after COVID our past prices that I just quoted were 15 or it they are over they are 20 Wow. 20 almost 22 for the overall costs, it has it has gone up by 30 35%.
Pam Pyms:What do you attribute that to?
Brandon Schwab:Well costs for everything postcode It has been able to go up. I mean, our our cost just to build it off site has gone up. I mean, so like everything's gone up 30 to about 50%.
Pam Pyms:My goodness. Yeah. And are you? Are you currently sort of in the rural areas of Illinois? Where are you? Right now?
Brandon Schwab:So I am, I'm about an hour from downtown. I am typically in towns that have, you know, 25 to about 80 80,000 people, I do have a handful of towns that are in, in towns of only about 18 1800 people.
Pam Pyms:Well, they have elderly to, you know,
Brandon Schwab:they, they do, and and the projects that I am going to build are typically 35,000 to about 42,000 people.
Pam Pyms:Well, you have certainly done your homework. And I imagine if people want to find out more about you, I mean, is the best way to schedule an appointment with you at www Brandon schwab.com.
Brandon Schwab:So it is actually I have, I have been able to just find that if a person is interested in and talking, they can go on there book a time to talk with me, there are times for us to talk on the phone free for anyone that's interested to invest or for it for it. For anyone who is interested in opening up their own home, I do have a a ditional gift that I could give them, they have to book a time to talk with me, I did come up with an 85 page guide that I am able to offer out, I've got other guys in this industry that are charging $2,000 or like 1500 to$2,000 for but I would be able to give it to anyone who's interested in opening up homes or are potentially interested to partner up with us to be our our actual operators.
Pam Pyms:Wow, you know, the one thing I wanted to come back to that I don't know that much about but I have heard about, you know, something called social impact investing. And I heard you use the word impact impact investing, and is there some kind of benefit to an investor to be able to invest stay under that category? Do you know
Brandon Schwab:so so I think the overall best option out there for people doing it is that they are going to feel good, that the dollars that they have to invest are able to go towards an asset class, that's going to have a good m packed going forward. I I typically talk to two bigger family offices. And these family offices, in average family office have about 300 plus of capital to put out into play, they are so looking to earn a top a top ROI on they are interested to earn dollars. But I think that their top cause is that the family can feel comfortable, particularly if their family has had any issues personally have in their own family of possibly they put a person in their own family into a place that didn't get very good care. It is it is going to give them the opportunity to be part of changing how the elderly are cared for going forward. That's the biggest poll for the impact is to for people to impact the overall change going forward. And our our overall our overall capital fund is is able to be geared towards giving back by offering awesome care. A thing that I didn't tell you earlier is before COVID are our company's top KPI. Was that everyone that did pass in any of our homes, they were able to answer how or the place that they were able to go to After Earth and also how they are able to get there. Everyone that ever passed did that during COVID. It is harder. I can't tell you everyone that did pass during that time. He was able to answer that over all question just because I couldn't go in there.
Pam Pyms:Tell me the question again.
Brandon Schwab:Our business is is able to help people that are in our homes as they are as they're getting closer to the end, right. So they are going to begin asking a question of the place that they are going to go after Earth. Right. So after they are able to after they are able to actually pass? And that's a tough question, because if that question doesn't get answered, It has an E terminal in pack on that particular person. So our overall plan is to build homes that are able to hear those questions, and then answer those questions. I was able to partner up with Teresa back in 2015. And she's done a great job at being able to answer that question for people in all of our homes. Are you saying that your homes are faith based, faith based they are. But if anyone's ever come into our homes, and ask those questions, I will help connect them of the perfect pastor Hmm, to their own faith. Our thing that I think is key for us is to answer those questions. So they feel comfortable because oftentimes, the families kids have a hard time having
Pam Pyms:that conversation. Yeah, one of the hardest you can have.
Brandon Schwab:Yeah, but because our overall business is here, it's easier for us and I and I can tell you all the times that afterwards, the kids were just busting into tears, because they didn't have that part answered for their own parents. But the fact that our partner Teresa was able to go in there and to ask those kind of those tough questions, but then also help answer how they are able to, to be able to do that has been a big, that's been a very big part of our overall operation.
Pam Pyms:That's something very unusual that you are offering, and no matter what their religion or faith that there is someone there to help guide them. Yeah, and answer and help them feel more comfortable about the transition that's ultimately coming.
Brandon Schwab:Well, if you were able to, if you were able to think on our whole country, right, our whole country doesn't feel comfortable having that conversation, right. And till they get closer to the end. And oftentimes, that question that's able to come up is it is easy to overlook it right? Because it is pretty quiet. But if the poor care team has to care for 15 to 20, people, they aren't going to ever hear that question. But if you are going to have an atmosphere that the caregiver who only has to care for five people, they are able to have time to actually talk with people and have those conversations. Because as that question comes up, it often doesn't come up often. But if it does, our care team is is able to go, I've got to talk to the church, the the I will have them call, they will call Theresa Right. Right. And then I had Theresa come in to have that tough talk, but that talk has to be done before they're able to pass.
Pam Pyms:Wow. So you let them age in place. And you let them continue to live out their lives with you. Yes. All the way to the end. That's fabulous. Gosh, I wish we had more time. I feel like we're really just getting started with understanding what, you know what what Shepherd, premier Senior Living brings to the table? Sounds like a lot. And it sounds like one thing is for sure. You're going to walk in and it's going to smell good. Yeah, yeah, they're cooking those brownies, or you're gonna have the smell of the kitchen and not as you mentioned, those some of those bigger buildings are pretty rough with the smell. I'm I agree with you. But anyway, I want to thank you so much for your time today. And thank you, Pam, we're gonna hang out, don't you hang up right away. But we're going to say goodbye. And I'm going to thank you and I look forward to talking to you again soon. All right, thanks. Thank you very much. Hi. Thanks for joining us today. This podcast is brought to you by haven senior investments. haven senior investments is the leading faith based senior housing advisory firm focused on providing their clients With the knowledge and expertise necessary to support their goals of buying, selling, developing, investing, or operating in the senior housing market, they can be found at haven senior investments.com