Neil Silvert: Hi, everybody. I’m Neil from the Your Grey Matters podcast. Welcome back. We hope that you had a great week, and we are incredibly excited today. We have Steve Suske with us. Hi, Steve. Welcome to the show.
Steve Suske: Hi, Neil. How are you?
Neil Silvert: Really, really glad to have you. I’m great. Hey, folks, no glasses, cataract surgery this week.
That will be a separate episode, but the timing’s good because we’re talking about housing for seniors. The families of seniors boomers today, and we have who I think is probably the best expert, the most knowledgeable man I’ve ever met in the industry. And he’s also quite a gentleman. So I’m honored to have you on, Steve.
And folks, let me tell you about Steve Suskey. S U S K E Y. He’s the president and CEO of Suskey Capital, Inc., which is his company. And it’s a private equity firm. It’s based in Oakville, Ontario. And they’re focused. They’re focused on investing in real estate. Finance, emerging technologies, alternative energy and health care.
Steve himself has been an entrepreneur for over 40 years. And he has professional experience in developing and managing businesses. He’s overseen, led and advised over 5 billion dollars in business transactions. And that is amazing. And he is known as the leading authority in North America’s seniors housing.
That is the sector that I want to talk about today. Steve founded Chartwell Retirement Residences, which is a cornerstone of Seniors Housing. As a founder of Spectrum Seniors Housing Development Corporation, Steve oversaw the development of over 60 Seniors residences in just a 10 year period. And I know something that’s very near and dear to Steve’s heart.
Very impressive. Steve actually graduated with an MBA in 1977 from the Richard Ivey School of Business. And he maintains really close ties with that business school. That is a huge accomplishment. In fact, my own cousin just got into that school, Steve. We’re quite excited. That’s great.
Steve Suske: Congratulations.
He’s like, I could never have got into the school now.
Neil Silvert: I never got into any school with it. That’s a different topic. He’s acted as an entrepreneur in residence since 2009, and as a member of Western Entrepreneurship Advisory Board. So, of course, the school is at Western University in London. In 2017, he was actually honoured with the Ivy Distinguished Service Award, which is an award for alumni who provided extraordinary service to the Ivy Business School over an extended period of time and in 2018, Ivy Business School announced the establishment of the Stephen Sutske Ivy New Venture Project Award and Stephen Sutske Entrepreneurs in Residence Program.
Such accomplishments. Steve, welcome to the Your Gray Matters podcast. Thanks for coming on.
Steve Suske: Thank you for having me, Neil.
Neil Silvert: Yeah, we’re really excited. So tell us, how the heck did you get involved in seniors housing? What inspired you to do this, Steve?
Steve Suske: That’s quite a story, but I should tell you that before my MBA, I went to King’s College in London and got a BA in philosophy.
Neil Silvert: Ah, philosophy.
Steve Suske: So that’s an interesting combination of MBA and philosophy.
Neil Silvert: It certainly
Neil Silvert 3: is.
Steve Suske: I really felt when I finally got in the senior housing business that it was the right move because we’re looking after people’s mums and dads beyond their expectation, but senior housing is also a business, so it was, to me, a great A great melting of the, my philosophies, my personal philosophies, et cetera.
Certainly makes sense. So I was in the real, I was a invest real estate investment banker. And my client came to me with a project in to be financed in, in Mississauga Air Mills Lodge. Still going. And we put together a, a, an interesting deal. The, the owners of that were having a World War 3 and I went in there, settled all the lawsuits and got everybody’s release and we put CMHC financing on there for.
10, 000, 000, 750 and, we put a half a 1, 000, 000 dollars in our jeans and half a 1, 000, 000 dollars into the project and I was in the senior housing business.
Neil Silvert: Wow.
Steve Suske: It had been ever since. So, that was that was a good, good thing, but. So, I really, as I, as I, then I really realized that senior housing was very, very capital intensive.
And that in order to do that to raise the money to grow, we had to start a public company. So I put together Chartwell. It’s called Chartwell. It wasn’t called Chartwell, it was called Chartwell Retirement Residence. That’s what it’s called now, but it was called Chartwell Senior Housing before and we put that read together 20 years ago.
I just went back there as the founder of their 20 year anniversary. That was nice to go back and see.
Neil Silvert: Congratulations. Wow. So
Steve Suske: we, we did that to attract capital. So we had a so it was the first senior housing. Public company in Canada. And it was a $240 million raise. We were five or six times oversubscribed, and it’s, and it’s been, been a success.
I still have very, very good contacts with Chartwell. Matter of fact, we’ve sold many projects that we’ve built to Chartwell. I actually have four projects right now that we’re in the final stage of negotiating with Chartwell. So if, if they’re a great company and, we’re, we’re very aligned with them.
So getting back to it, so I got very, very comfortable with the philosophy of what we’re doing. As I said before, looking after people’s moms and dads beyond their expectation. And that really became clear to me recently when a part of my extended family. A great grandmother passed away and she was out of charwell home.
And we went last Saturday to the celebration of life. I could tell you that was that was an eye-opener for me because all they did is talk about how great a home the Chartwell facility was in chart in Scarborough. They talked about the the, the, the all the people that worked there and how kind they were and how the grandma just loved living there.
And it was such a relief in her, in her latter days to to be surrounded with the the attention and love of, of the Chartwell community. Quite frankly, I just kind of choked up on that because we really are providing a service to seniors that sometimes when they get involved in the business side of things, we forget about, but Her living in a Chartwell home in Scarborough was just a great experience for her and the family.
It allowed the the eldest daughter to be feeling, you know, you’re talking about your parents, Neil. The the eldest daughters are always the decision maker about whether or not a mom or dad goes to, into a retirement home and they made a decision to, to to, for mom to go into Chartwell and they all said it was the best decision they could, they could possibly make.
She got it. Three square meals a day, good meals. She got, there’s, we have nursing staff who look after her administration of pills, a very vibrant and active senior social activity programs, and housekeeping weekly, and and the whole family was very, very Ecstatic with the, with the home and that they all made the right decision and she was there until the day she died.
So at the celebration of life, I was really proud of the fact that I had started Chartwell and that to hear the impact that home had on that particular family was, was very moving for me.
Neil Silvert: Steve, obviously moving and important. And the words that you just said, of course, are so important because it’s the health and care and the love that we want our family members to get in their later years, of course, through their whole life, but we worry much more in the later years for ourselves, for our family, if they’re still with us.
So I congratulate you and Chartwell for that. I find, though, that you said a word that’s touching me and part of why I wanted to do this podcast today, Steve, is the word oversubscribed. I’m a boomer. I’m 70. We’re starting to think about next steps, although not yet into a a residence like that yet. But Steve, there’s seems to be a lot more people needing the facilities than we have the facilities.
And I’m wondering, you must have seen a lot of changes over the years to this whole industry, and now the boomers are coming into this. They’re going to require facilities. Tell me what you’re thinking about this changing industry and Where we should go with her.
Steve Suske: So that’s a good question. And and the industry got severely impacted by covert.
Okay. So what happened was that, uh, people start stopped coming in for tours. So the occupancies went down. And and and construction for new sites stopped because of the higher interest rates Colbert. And just now that things are starting to, to, to pick up what happened there is nobody building anything projects and we have.
A lot of projects at various stages of development, but all the specialists, all the market analysts will tell you that there is a huge pent up demand. For senior housing, because nobody was building anything. So that’s why the chart. Well, it is, is. At the table with us on on 4 projects. And they’re eager to do it because there’s no product out there.
There’s literally no product out there. For them to buy and grow.
Neil Silvert: And I was wondering about that. Sorry to interrupt, but you’re right. COVID had an effect. I did some research on that. And it seems like. The market’s starting to come back from that, as you said. But we hear all day long about the lack of land to build.
Worse than that, the person services to build these facilities. I mean, it must be a challenge all the time, being able to put these badly needed facilities up.
Steve Suske: Yeah, there’s no question about that. And it’s expensive. You need about but 140 bad retirement home together. You need hard cash equity, at least 10 or 15 million.
So it’s a, it’s not for the faint of heart. And it’s and, and, and so thank God there’s companies like Chartwell and Sienna and some of the big boys out of the state to are buying up these, these new facilities. Because You really need it now. We as developers and private equity guys need to recycle our money.
Yeah, so we’ll build know to take advantage of this. I call it. I’ve been saying for years that we’re talking about the baby boomers. It’s it’s a demographic hockey stick. And it’s just beginning to start right now and there’s. Unbelievable demand for our product and and because of COVID supply was severely impacted.
We’re, we’re trying to catch up, but it takes a while for, you know, for lenders to get satisfied. The big news that happened this week was the Bank of Canada rightly took 25 basis points off of the, off of the, so CIBC and Royal Bank and all their economists are saying that interest rates are going to come, were to start coming down back in Canada, 25 basis points this week.
But we expect 200 basis points will come, come down off a prime that will make a lot of projects, a lot more economic. And so we have projects that are on, are on the sideline waiting for interest rates to come down. So it just exacerbates the problem, Neil, that, you know, if people can’t build because the interest rates are too high, even now that COVID is over with, you still need to get the interest rates down to, to become economically feasible.
And that’s that’s where we are in the industry right now.
Neil Silvert: Yes, and you’re right. I was glad to see the, the, lowering 25 basis points as a start, but we do have to get this real estate economy moving again. So I agree. This will be helpful because the requirements. The number of people who are going to need Chartwell and other facilities like that.
We’ll never stop growing. This is a never ending business, I think, Steve. Would you agree?
Steve Suske: I absolutely agree. And now we’re there’s maybe I could just take a minute and say that senior housing is just not a retirement home. We’re involved in in the, in a number of phases of, so the treat of the week this week, or this year, is seniors apartments.
And so. That’s the, I always use this example. The eldest daughter is looking for a place for mom and mom is saying it’s too soon. I don’t want to live there and everything like that. But mom needs to live in community. There’s no question about it. She needs. To live in, in, in a community where her needs are looked after.
So we have got. A number of projects here in Ontario and in Alberta. We are offering a seniors apartment concept.
Neil Silvert: So talk to me about the seniors apartment. Can you break down what that is more their services? What would that be?
Steve Suske: We have a facility in Edmonton, for example that is about 188 suites and, we have a manager, we have 2 marketing people that’s still in lease up. We were. Just to give you an example, last month, we did 12 leases. In the month, which was a great, great rate. We have a restaurant in there called tutti frutti and, and residents have a deal with the restaurant where they pay.
300 bucks or something like that, 350 to tutti frutti and tutti frutti provides all their meals. So the mom or dad is in this apartment. Stove, and fridge, and microwave, and washer, and dryer, and dishwasher, et cetera. So it’s a, it’s a standalone apartment, but the eldest daughter gets satisfied that mom could always go down for for lunch, and for breakfast, lunch, or supper, and, and work off her 350 bucks a month, and, and have, and have dinner and community with the rest of the residents.
We we also have a it’s called Manchester Rose, which provides. Care for the facilities, so it’s not on our payroll, but if. If mom wants her dog walked or she wants to go to the to the doctor’s office or go to, you know, pick up something or, or help with administration of her, of her medication or getting her bed made and stuff like that, she could buy that from Manchester Rose.
So from our point of view. That particular product where we’re just we provide a maintenance guy. We have an activity person and and the manager and the 2 marketing people and an office manager. So, there’s not the, the infrastructure that you would have at a typical retirement home. Right. You would have.
And that’s more, more so we like that. Like the seniors apartments and it’s like we have two facilities in Alberta that are a hundred percent full now, three Robins, Stony Plain, and three Robins Red Deer. And it’s an interesting contract concept that the, we say to the residents you get two, 200 bucks off your rent.
If you come and live and volunteer and be part of our volunteer program. So, if you’re good at working in the wood, wood shop, or you could call bingo, or you could be responsible for different outings, things like that the residents volunteer. And what an incredible difference that that has made.
Sure. Because everybody’s working, the whole place is a volunteer. If you, we had an open house there and there’s people in the elevator being the elevator operator up and down and and there’s, if people want to come in and the manager’s not there and people want to come in, they can get a resident who will give the new resident tours.
That’s wonderful. And it’s a real amazing community of Of volunteers and people who feel part of the part of the community, which is a great concept
Neil Silvert: and that whole idea of developing a community. The way that you just described it. It’s helpful to the person living there helpful to the family.
Gives a person a reason to get up in the morning. It’s terrific, but if God forbid they fall down and break their ankle, it’s the same thing as if you’re living somewhere else. You call 911 to get help. It’s not that there’s medical help in the facility. Am I correct with that?
Steve Suske: Yeah, well we would have Manchester Rose, which is the service operator and they would come in there and they would Help with if mom, mom had to fall on what to do.
So there’s professionals there, but they’re not part of our payroll. But the beauty of these things are the people you know, they, it’s the whole concept of living in community that the eldest daughter gets feeling very, very comfortable that mom is gonna be looked at. So if mama’s in her condo or her home.
And, and she’s not getting proper meals. She’s forgetting her her drugs she has to take. And the place is a mess. And now if she lives in, in one of our facilities and lives in community it’s, it’s an uplifting you know, she’d go down the hall and play bridge whatever. So Living in community for the eldest daughter is a great, great.
Neil Silvert: Yeah. Steve, I imagine that we could use facilities like that all over our country. And then you mentioned Alberta, but the need must be for everywhere.
Steve Suske: So, we have a great facility in Eskimo and in Vancouver, Ireland, next to Victoria. And just to give you an idea how. So it’s 11 stories. It’s the best facility we’ve ever built.
It’s 11 stories. On the 11th floor is all the amenity areas. So if, if you want to go for lunch or dinner, you go up to the 11th floor because it’s got magnificent views of Victoria, the ocean, the mountain, everything. So great. The next two floors down nine and 10 are, were sold as condos. So. Residents could buy the condos, participate in all the services of the retirement home.
And then the next floor is down, or independent living, and, and which is for, you know, nobody in a retirement home, nobody’s independent, right? Let’s get that clear. People are the eldest daughter feels that mom’s got to live there. Because it’s care driven, and then we have, we have a couple of floors of, uh, assisted living, which is they’re all they’re always full.
So, and that was a beautiful home because, was a site of a old legion, you know, legion. And the legion was broke on there, you know, didn’t have any money. So, we kind of deal with the legion where we bought the, we bought the property. We provided the legion with a beautiful facility that they, they’re, they’re using new furniture and everything like that.
So the legion is still in the building. And so it’s a, it’s a very active thing.
Neil Silvert: Wow. Amazing. Steve, let me ask you, if I can now, let’s move to assisted living, which is what I think a lot of people are thinking of when, when they move to seniors residences your company or not your companies in general, are we serving the public?
Are we, are we building assisted living? How’s the state of the industry? And what do you think we need coming in the next number of years?
Steve Suske: Well, as I was trying to say before, is that there’s the seniors apartments, and there’s independent living, and assisted living, and then the next thing is private pay, memory care, and then there’s LTC.
Neil Silvert: Okay,
Steve Suske: when I was a chart, well, we were involved in long term care, but that’s not our focus these days, but there’s because that’s government funded. Government license and government regulated.
Neil Silvert: Ah, okay.
Steve Suske: That for entrepreneurs like me, there’s. That’s 2 government, so there’s a, the governments are always struggling with, funding these things to make them worthwhile for developers and for for residents. We are heavily involved in, alberta and their funding model is, is is called the DSLs and they are, their funding model that the Alberta government has is really antiquated and makes almost impossible to build any new facilities
Neil Silvert: under
Steve Suske: the current arrangement.
So governments, if governments have got to be aligned on that better to make these facilities. So, there are challenges and they regulate it. Part of the business, but there’s need for every, every year. So, baby boom is coming. There’s need for big demand for, seniors apartments, big demand for independent living and most independent living have a.
Assisted living and memory care as part of it. So.
Neil Silvert: Okay,
Steve Suske: and her health goes down. She could move from the independent living into the assisted living and for. Facilities maybe she needs memory care. So, eventually, so so they stay there as long as they can afford it. And or, or they could go to long term care, which is.
Neil Silvert: So, the whole idea of affording is a big issue too for a lot of people. And I’ve often wonder what do we do with all these folks. Who can’t afford the pay to live facilities. Where do they go?
Steve Suske: It’s a, I always used to say on my road shows when I was a child, and your audience would appreciate this, where does a little old lady who worked at Kresge’s, where is she going to go in her retirement, right?
And it’s a real challenge for our country because the little old lady from Kresge’s can’t go into private pay, like our rents and private pay are, are, are high, right? And but Yeah, there are high, so you have to have a bit of a nest egg. You have to have your, you know, proceeds of your house sale, et cetera, like that.
But that’s a, that’s a challenge for society of where do all the. The little old ladies who used to work at Kresge is where, where, where are they going to go? And it’s a sad, it’s a sad thing. Now, the good news is. I’m 73, and I do get. At the end of every month from the federal government about, I think it’s 2, 400 bucks a month in an old age pension. Now that, that’ll get you going in any one of these retirement homes, but you still need more money from families or, or from your. Selling of your home, your pensions to, to afford that. So, like, the homes I just talked about in in in Esquimalt, I mean, you’re talking about rents of about 5, 000 a month, so.
Neil Silvert: Yeah, I, I have friends whose families have moved into some of the assisted living residences. They’re paying 7, 000 or 9, 000 a month.
Steve Suske: They’re much higher, and memory care is much higher, too, so.
Neil Silvert: Wow, well, well, I don’t think that we’re at the point where we just stack people out on the streets, but we are indeed seeing a lot more homeless.
And you said before the government. Isn’t perhaps standing up and doing what they need to do to provide these facilities or, or making it worthwhile while for developers like yourself. And I don’t believe that the government has to provide something for entrepreneurs other than the. The environment to want to grow and to build and to help people so that people are helped and entrepreneurs make money.
And if that’s not happening, then that is a real problem in this country.
Steve Suske: Yeah, that’s right. So, you’re right. It’s 100 percent true.
Neil Silvert: Wow. So, Stephen, I thank you for all this. Let me ask you, being a real estate investor myself, and of course, you are, for those who are inclined. Can you invest in this kind of development?
Nowadays, like, are there good opportunities? Maybe tell us about something if, you know.
Steve Suske: Yeah, so most of our, projects are bring private equity people in. On our, on our deals, and they either come in as a. As a secured on 2nd, mortgage or preferred share position. And so we, we have from time to time.
Offerings like that. What we’re doing in Suskie Capital right now is we’re selling most of our facilities to because, you know, they’re, they’re, they’re ready for sale and there wasn’t really a market during COVID. And now that interest rates are going to start coming down, there’s a market to buy.
But to your, to ask you a question, yes if people want to go on SuskieCapital. com, we have, we, we’re, we’re always looking for investors to come in. And we have. Section on our website that talks about that.
Neil Silvert: Very interesting. We had. a Neil Silvert on a few weeks ago with a company that has an insurance type of policy now that you pay into now, and then if you need facilities, not so much facilities, but requirements as we get older, PSWs, help with a place to live, etc.
That’s what they provide. And it’s really interesting. Somebody made a business out of being able to buy an insurance policy, not a life insurance policy, but a policy to be able to afford things that you’ve been talking about and leave it to entrepreneurs to find the way. And, and I found that very, very interesting.
Steve, I just want to say that we could talk for hours and do 20 shows about the need that’s out there. And the need, whether it’s being filled or not, and how we can fill it. And that’s great, but I want to ask you on a personal level. You must have some really terrific stories or experiences that have been very rewarding to you.
Tell us about some of the things that have come across your life that have made a difference.
Steve Suske: In senior housing, I could write a book about it. Mostly about bad partners that I got involved with. It is the, it’s just, it’s amazing business to be in and I can’t think of anything right now, but. But you’re touching
Neil Silvert: the lives of people every day is what you’re telling me.
Steve Suske: Oh, yeah, no, that’s, that’s, that’s a big thing. And Suskie Cap was a family business, so all my kids are involved in this and my stepkids and so we believe that you know, as you said, you know, so. The demographic growth for the, what I call the demographic hockey stick is, this is the business to be in.
We just got to make, we just got to get interest rates down. We’re through COVID. And and then I think the world is our oyster. So that’s, but I could tell you stories about the. Some of the operators out there, so, and that’s, that’s why it’s so good to have firms like Chartwell and Siena, some of the bigger guys who really Care about residents and it’s not a financial ploy.
It’s, you’re really looking after people, moms and dads, hopefully beyond their expectations. And that’s what always been my commitment. And going back to the very original, having a, a, a BA in philosophy and an MBA is a perfect thing. To get involved in to senior housing is, is perfect because you feel as if you are giving back to society and that celebration of life I’ve talked about before.
Boy, was I ever delighted to, you know, that the impact of that home had, Chartwell home had on, on the family was I had forgotten about, so it was very positive.
Neil Silvert: Well, that’s, that’s good. And I have to say, just as we had to wrap up, Steve, my takeaway from this is. Is that the entrepreneurs and the people are building these facilities and providing them, they’re going to need a lot more help from whatever to continue to build them.
The environment’s going to have to change the government’s going to have to do their part for the long term facilities and. People at a young age have to start planning for where they’re going to end up maybe more now than ever before, but hopefully the industry will be able to provide what people need.
As I said, I’ve been involved in helping an elderly mom and, and, and my mother in law, great people still living on their own. But if they want to go into these facilities. There could be a waiting line, which is a hard thing when you’re 91 and 93. And, and that’s a real commentary about big change.
Steve Suske: As I say, if once mom moves in, you know, she’s getting three square meals a day.
She’s getting her housekeeping. She’s getting an activist, uh, program, social activities. And she’s getting her and she’s taking her pills every day. The nurses make sure they take their pills and they just become happier because they’re living in community.
Neil Silvert: Yes,
Steve Suske: they look forward to going down to the dining room for breakfast, lunch and supper, and it’s great.
And the beautiful thing about the eldest daughter is relieved that
Neil Silvert: I think that’s the point, isn’t it? Steve is that the children of our very elderly are also baby boomers and seniors themselves ourselves. So that peace of mind. is huge. I think what you’re talking about is peace of mind.
Neil Silvert 3: And
Neil Silvert: it doesn’t just extend to the person who moves in, it affects the whole family.
Steve Suske: And the incredible thing, Neo, is I watched the D Day celebrations yesterday with Trudeau and Biden and meeting with the like some of those guys were a hundred, 103, 105 years old. Like people are living longer. Yes. One of the great things about the, we’re in a golden age. Age of our of life, the average life oxygen has gone from 45 years old to 71 now, and it’s getting longer and longer all the time.
Neil Silvert 3: Yeah. Which
Steve Suske: it went down, went down in the States, but in Canada, we’re all living longer. Thank God. Touch wood. Yeah. But there’s going to be a huge demand for for facilities that are care driven, could look after your mom and dad.
Neil Silvert: Yes, and actually it’s changing because we’re living longer. The societal changes are astronomical right now, and we have to get to it now.
We have to plan for quite a bit farther into the lifespan of people. It’s remarkable. Steve, I want to thank you so much for coming on today. I wanted to start this discussion on Your Gray Matters because we are Your Gray Matters, but planning where to go, and if you’re an entrepreneur, looking into maybe a place to invest, there’s a lot of terrific parts to where we are in the industry, but obviously we have a long way to go and a lot of planning and a lot of changing of thinking in many areas.
To make sure that we’re taking care of our elderly. So, Steve Susky, you’re a pleasure. I’m glad to have you on the show. Steve, if somebody wants to get a hold of you, how should they do it? Perhaps tell us your website and we’ll post it up for you.
Steve Suske: Okay, so my, I’m happy to take anybody’s calls, but my cell number is 647 407 7797.
And my email is ssuske at suskycapital. com. Terrific.
Neil Silvert: Well Steve, keep going. I thank you and I hope I’ll catch up with you soon and we can grab some lunch together. Looking forward to that, Neil. Thanks. And I thank you very much. Take care, Steve.