Putting People First
ÁegisLiving has found success by creating
an environment where employees feel valued

Snohomish County Business Journal/KIMBERLY HILDEN “I’m the chief delighter; that’s what I get to do. I have to look for ways to delight my employees,” says Dwayne Clark, president and chief executive of ÁegisLiving, which operates 42 retirement communities.

By Kimberly Hilden
SCBJ Assistant Editor

It’s Wednesday at the Redmond headquarters of ÁegisLiving, and personal trainer Pete Delarosa is on duty in the workout room, encouraging an employee on the treadmill. He comes every week to provide his expertise at no cost to staff members. Áegis picks up the bill.

“I’m Dwayne’s trainer, so what’s good for him is good for his employees,” said Delarosa.

ÁegisLiving Headquarters: 17602 NE Union Hill Road, Redmond, WA 98052 Phone: 888-252-3447 Web site: www.aegisliving.com

“Dwayne” is Dwayne Clark, president, chief executive and co-founder of Áegis, which owns and operates 42 retirement communities, including locations in Lynnwood, Bothell and Edmonds.

And in the nine years since starting the company with co-founder William Gallaher, Clark has put into practice a philosophy that creates an environment of caring and encourages the establishment of trust between employees and management.

At the corporate office, for example, there is a well-appointed massage room where a massage therapist comes to give free massages to employees weekly. There is a cafe area where healthy snacks are offered, and the company courtyard has a reflexology foot path to promote overall wellness.

Companywide, Áegis has a policy that every vendor it does business with must offer something for its employees, Clark said, whether in the form of discounts or added benefits.

“The aggregate impact is that the employee then sees the company as ‘these people care about me,’” said Clark, who has spent 20 years in the retirement industry, including roles as executive vice president for Sunrise Assisted Living and director of operations for Leisure Care.

Áegis also employs a chief cultural officer, Polly Miller, who works to maintain the company’s people-centered culture, said Karen Lucas, vice president of strategic marketing.

“I think a lot of companies talk about employee-first culture, but at Áegis, with the programs and employee services, it’s sincere,” said Lucas.

The results of Áegis’ employee philosophy can be seen in turnover that’s well below the industry average, said Clark, who in 2001 wrote the book “Help Wanted: Recruiting, Hiring & Retaining Exceptional Staff.”

“The industry average is about 130 percent. I have been to companies where the turnover is 500 percent,” said Clark, noting that staff turnover at Áegis, which employs about 2,000 people, is currently about 40 percent and that its lowest annual turnover has been 23 percent.

“I’d like it to be zero, but never, never in the history of senior housing, I’ve never heard of a company having 23 percent turnover,” he said. “... We are the leaders in that arena, and it bleeds over into our customer service. It helps us in a very positive way.”

The company has been named among Washington CEO’s Best Companies to Work For since 2002, was ranked as the Third Fastest Growing Private Company by Inc. magazine in 2003.

“We’re a smart company in terms that we don’t like radical growth,” Clark said. “We have our core here, a good base for what we’ve done. We’re not looking to grow by 30 properties in a year or anything like that, probably two to five properties a year. Our revenue growth is going to be pretty impressive ... $20 (million), $30 (million), $40 million a year.”

When it comes to buying or developing its private-pay retirement properties, Áegis uses a “cluster concept,” providing pricing options and multiple locations focused on four metropolitan areas: Los Angeles, San Francisco and San Diego in California and Seattle in Washington state.

“If you look at the population in California and Washington combined, you’re approaching 40 million people,” Clark said. “We don’t have to be in 10 states; we just want to be in four great cities.”

As for pricing options, Áegis has developed four product lines: Áegis Assisted Living, Áegis Senior Living, Áegis Senior Inns and Áegis Signature.

“When we started the company, we started with Áegis Assisted Living, homes with 50 to 90 units in size, purpose built, brand-new construction for assisted living with an Alzheimer’s/dementia unit,” Clark said. “That was our bread-and-butter model and the first 20 projects we built.”

Customers later requested independent-living communities, leading to Áegis Senior Living, which features a more independent, luxury lifestyle with a small assisted-living component, he said. And three years ago, the marketplace asked for a more affordable price point.

“People were saying to us, ‘We love your product, programs and management, but if it could just be $1,000 more affordable ...,’” Clark said. But when you’re building a new project, construction and land costs often determine what you have to charge.

To offer a less expensive assisted-living alternative, Áegis developed its Senior Inn model, with the company buying 20- to 30-year-old retirement communities and investing between $1 million and $2.5 million to renovate them.

“The renovation cost and purchase cost is usually less than what it would cost for a new building, and we pass on the savings to customers,” said Clark, noting that the company has pricing points in Senior Inn models starting at $1,700.

The newest product line is Áegis Signature, continuing-care retirement communities that feature luxury amenities.

Although CCRCs can be organized in a variety of ways, they typically include independent-living housing, assisted-living facilities and nursing homes so that “entering one is usually a once-in-a-lifetime choice,” according to the AARP.

For example, Áegis’ new Signature community, Varenna at Fountaingrove in Santa Rosa, Calif., includes a care center that offers assisted-living services as well as a facility for residents with Alzheimer’s or dementia. That’s in addition to Varenna’s apartments for independent living.

The entire gated community was developed on 29 acres in the Sonoma County wine country, is next to a golf and athletic club, and includes concierge and valet services, a massage room, spa and salon, indoor and outdoor swimming pools, weekly housekeeping and fine dining.

“It’s like buying a condo, but you’re not getting a title to it,” Clark said of CCRCs, noting that the cost to live in such a community is all over the board. “You’re writing a check from $300,000 to $1.5 million.”

In the Puget Sound area, Áegis operates 11 retirement communities, with its newest, Áegis of Edmonds, under renovation.

In June, the company bought the former Edmonds Retirement Inn from Kavatek International Corp. and is investing more than $2 million to turn it into a Senior Inn, complete with a theater, bistro, wandering rose garden and beauty salon, Clark said.

“It’s going to be a remarkable transformation for that building. It’s not going to look anything like it did before,” he said.

Work on the 62-unit community, which will include 42 assisted-living apartments and 20 Life’s Neighborhood apartments for Alzheimer’s/ dementia care, began in early fall and is expected to be completed by the first of February, Clark said.

“The nice thing about the property is the convenience: It’s a stone’s throw away from Stevens Hospital and close to downtown Edmonds and the freeway,” he said, adding that deposits are being taken for Áegis of Edmonds on a first-come, first-served system.

Because of Áegis’ cluster concept, the overfill from those waiting for a space at the company’s Shoreline or Lynnwood communities now can be directed to the Edmonds property, Clark said.

“From a business standpoint, our operations, because you can share the Yellow Page costs, recruiting costs and everything else, we operate more efficiently,” he added.