The Cypress: Owning Their Own
Corporate Spotlight
Written by Amanda Gaines   
Tuesday, 01 January 2008
The Cypress: Owning Their Own - Health Executive - RedCoat Publishing
Jim Coleman explains how this continuing care retirement community is built to satisfy its members and support its staff.
A growing demographic only means one thing: an increasingly competitive industry in which only the most innovative will lead the pack. In the retirement housing industry, The Cypress is one such leader.

The Cypress: Owning Their Own - Health Executive - RedCoat Publishing
Jim Coleman, Managing Partner
Since opening its first location in Hilton Head Island, SC in 1992, the business model of this CCRC has differentiated itself by offering residents equity condominium ownership as opposed to an entry fee. While a traditional CCRC model asks residents to provide an entry fee (with only a fraction of the investment being returned), The Cypress guarantees that appreciation on its cottages and villas goes back to the owner.

“If you move into a $300,000 entry-fee community home, the best you’ll get back is $270,000 somewhere down the line,” Jim Coleman, managing partner, said. “If you buy a $300,000 condominium from us and its value increases to $500,000, as a member, you will enjoy that appreciation.”

Rather than building a campus and then putting the condos up for sale, The Cypress relies on pre-sales to move forward with construction. This approach takes the financial burden that often comes from the typical bond-issue financing off the owners/residents. “We put in a significant amount of equity capital up front. More than half of each phase is financed through pre-sales so we can get a bank loan for the construction,” Coleman said. “Each phase is paid off when it’s completed, which is great for the developer as well as for the members because they’re not carrying that burden.”

Each location is laid out in a similar manner with between 300 and 320 homes on each, including 100 acres in Hilton Head, 60 acres in Charlotte, NC, and 50 acres in a Raleigh location set to open in September 2008. Each location feels like a small college campus, and members benefit from a complete continuum of healthcare.

“Historically, CCRCs only had skilled nursing facilities. We offer everything from independent living to resident counseling services to assistance in living and dementia care,” Coleman said. “We also do home health, which is anywhere from four hours to 24 hours a day with a certified medical professional.”

The full scope of services, coupled with a unique business model, has made The Cypress the right CCRC for the kind of retirees looking for a place to live comfortable, carefree lives. An average member is 78, but according to Coleman, 78 year olds today are much healthier and more spirited than they were 15 years ago. With a 66% success rate for members who entered the health center to return to their independent homes, it’s clear The Cypress wants its members to remain active, healthy, and happy.

“Most people in their 70s understand that a CCRC isn’t just an old folks home,” he said. “They see this as a chance to enjoy their time together without having to worry about protecting their assets.”

Complete satisfaction
Developing such large-scale communities, however, does not come without a few challenges. Maintaining and developing campuses with 300-plus homes is unusual for a CCRC. And the company’s decision to grow in major metropolitan areas makes finding affordable and strategically located 40-acre to 50-acre sites even more difficult.

Its Charlotte campus, for example, was converted from a nine-hole golf course in a single-family community, and a similar situation occurred at its newest location in Raleigh. “The properties would have been difficult to get zoning approval, but because we’re a multi-family CCRC, the neighbors and town officials looked upon our project favorably,” said Coleman. “We don’t produce much traffic or impact the schools, but we do produce a nice tax base without demand for services.”

But any challenges involved in finding additional locations to develop are quickly overshadowed by the positives that come from having a united campus feel. The Cypress has an employee turnover rate of only 24% at its Hilton Head campus and 23% at its Charlotte campus. In an industry where the turnover is often greater than 100%, this is a remarkable achievement.

“Our employees enjoy interacting with our members,” Coleman said. “One recently told me she felt as if she had 400 grandmothers. That kind of job satisfaction shows, and our members let us know they feel taken care of and at home.”

The Cypress communities are managed by Life Care Services LLC. In 2006, the management group initiated an employee retention plan called Live the Vision in which members mentor employees looking to achieve a life goal. After qualifying for the program, 20 employees were matched with members who also volunteered, and The Cypress worked with a university in Charlotte to write up a formal mentoring program. The goals ranged from a waiter wanting to become an administrator to a concierge who got a short story published.

Life Care Services is currently moving The Cypress into its next phase of innovation by transitioning its health centers to resident-centered care by moving further away from the typical nursing home mentality and more into options for its members. Residents will be given more choices as to when they rise, eat, bathe, and sleep, which will also increase the one-on-one time they spend with caregivers. One of the first steps in the process is refurbishing the bathrooms in the health center to give them a more spa-like feel. “It doesn’t sound like a lot, but the nursing home industry has been so structured in the past that there wasn’t a lot of room for flexibility,” said Coleman. “It’s not easy to accomplish, but we’re dedicated to making our campuses as inviting and comforting as they can possibly be.”
 
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