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From the issue: April 2009 Quarterly
 Merrill Gardens is a family owned company based in Seattle. Parent R.D. Merrill is a timber company with Northwest roots that go back over 100 years.The Merrill family started Merrill Gardens 16 years ago,and it's now the largest senior housing company in Washington.
Pettit joined Merrill Gardens after 18 years in banking. He was Executive Vice President and CFO of Seafirst Bank, and President of Pacific First Bank. As President of Merrill Gardens, he combines financial experience and a passion for seniors. Starting with one community in 1993, the company has grown to 54 communities in nine states. Under Pettit's leadership, the Better Business Bureau named Merrill Gardens the Business of the Year. Additionally, The Family Business Institute honored Merrill Gardens as the Washington State, Family Business of the Year.
Q. What do you believe is the future of senior housing?
A. When we started, senior housing was an emerging industry and many seniors didn't understand that we are not a nursing home. Merrill Gardens is a lifestyle company, and that's our future. Our communities offer independence with private apartments, restaurant style meals with no set meal hours, and an extensive activities program. Residents say there is never enough time to participate in all the activities and programs.We also provide transportation, weekly housekeeping, and 24 hour staffing.
We believe residents should maintain the same lifestyle they had at home, when they move to Merrill Gardens. In many cases, residents find they are more independent because they don't rely on family for trips to the doctor, cleaning, home maintenance, or socialization.
Q. How is senior housing evolving?
A. We are responding to what residents want.We now offer concierge services, because residents find it valuable. Just like a hotel, we can assist with shopping, dog walking, party planning, and outings. The design of our communities provides for social opportunities, with wine bars, movie theaters,work out rooms, and intimate bistros.We also have buses and Town Cars to take residents on group outings.
It used to be that seniors stayed in their homes for as long as possible. This led to social isolation, poor nutrition, stress over home upkeep, and the need to rely on family members. Today, seniors understand they can move to Merrill Gardens and live in a private apartment, dine in the restaurant style dining room, stay physically and mentally active, and enjoy their retirement.
We also offer services to meet resident's changing needs, such as bathing and dressing assistance, or medication management. Residents only pay for what they need, and the services are delivered in the privacy of their apartment.
Q. Contrary to our current economic situation, you say now is the time to move to senior housing?
A. We are concerned about the economy and its impact on seniors. However, you might be surprised to learn that the troubled economy is actually creating a rare opportunity for seniors.
Senior housing occupancies have declined. Therefore, those who move now can be selective, find the apartment that meets their needs, and choose the community at the monthly rate they want. We don't anticipate that will be the case when the economy stabilizes. As occupancies return to normal, seniors will lose leverage.
In the past, developers regularly opened new communities. With limited credit available, senior housing companies are no longer building. This is going to create a serious supply and demand imbalance. It takes years to build a new community, and it will take a long time for the industry to catch up to demand.
The senior population is the fastest growing segment of our population There are 38 million seniors in this country now. That number will increase by 1.5 million seniors per year, over the next 20 years. Less than 10% of the senior population currently lives in senior housing. If there is a conservative 10% increase in the number of seniors who want to move, they will take up all existing supply.That will make it difficult for seniors to find what they want.
During previous downturns we saw occupancy decline, followed by a quick increase as the economy improved. It's going to be more severe this time because there are no new communities being built, and the senior population is growing. They will find exceptional communities, better apartments, better rates, and more choice with appealing floor plans.Those who wait may not have as many options.
Q: What about seniors who are waiting for the housing market to improve?
A: We know seniors are worried about the "lost value" in their home. They know what they thought their home was worth three years ago, and they want to see if it will be worth that again. A home is ultimately worth what someone is willing to pay for it.We think it's clear the housing market in Washington was overvalued, and there is no indication that prices will return to the levels we saw during that boom period.
Most seniors have owned their homes for a long time and have a large amount of equity.We generally find that seniors who sell their homes at current values, can comfortably move to a Merrill Gardens community and enjoy the lifestyle we offer.
For more information please visit www.merrillgardens.com
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