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Sunrise Senior Living, Inc. Business Information, Profile, and History

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Company Perspectives

Since the first Sunrise community opened in 1981, the Sunrise operating philosophy has been to provide services and care to seniors following Sunrise's Principles of Service: encouraging independence, enabling freedom of choice, preserving dignity, celebrating individuality, nurturing the spirit and involving family and friends. All Sunrise team members are trained to provide services and care in a manner that supports these principles and furthers Sunrise's mission.

History of Sunrise Senior Living, Inc.

Sunrise Senior Living, Inc. operates more than 420 assisted living communities with a resident capacity of more than 52,000 throughout the United States, Canada, Germany, and the United Kingdom. It has an interest in about half of these facilities and manages the other half for third parties. The company's communities offer a range of services, including at-home assisted living, independent living, community assisted living, Alzheimer's care, and nursing and rehabilitative care. Communities, which are built to resemble Victorian mansions, operate under the Sunrise, Brighton Gardens, or The Fountains banners.

1981-1993: Sunrise's Formative Years

In 1981, Paul and Terry Klaassen sold their home, borrowed money from friends, and bought and moved into an old nursing home in Fairfax, Virginia. Their goal was to create an "assisted living facility," an alternative to the conventional nursing home that provided care and services in a warm, homelike setting. "Assisted living," a term the Klaassens are credited with coining, is a concept of care based on the principles of preserving dignity, encouraging independence and freedom of choice, protecting privacy, personalizing services, nurturing the spirit, and involving family and friends.

This concept was formed as a result of the couple's prior personal experiences with family members needing long-term care. Terry, as a teenager, had provided in-home care for her terminally ill mother after her family eliminated its only alternative: long-term care in an impersonal, institutional setting. Paul's grandmothers both lived in senior residential homes, called verzorginstehuizen, in his native Holland.

The Klaassens' original facility opened in Oakton, Virginia, with the Klaassens in residence from 1981 to 1982. They cared for their first 25 residents personally, including bathing and cooking for them. They were in their late 20s at the time. That first year set the basis for the company's corporate culture. "We learned a lot about the services that assisted living needs to provide and how important the family [is] in the whole process," Paul explained in a 2003 Multifamily Executive article.

As their business grew to include more facilities and more employees, the Klaassens placed an emphasis on incorporating elements from the Dutch senior care system and their own experience, striving to make resident satisfaction the center of all efforts. "Terry and I visit all of our communities and make sure the values we started with are institutionalized deep into the company and that as we grow, we don't lose them," Paul Klaassen confided in the 2003 Multifamily Executive article.

In 1985, Sunrise Assisted Living opened two new Sunrise communities--Sunrise of Leesburg and Sunrise of Warrenton, both in Virginia--and the Klaassens debuted the first Sunrise training program for its employees to ensure that they understood and practiced the hallmarks of assisted living. The program later developed into Sunrise University, which provided team members with a career track within the organization and an active, organization-wide mentoring program.

In 1988, the first Sunrise prototype home opened in Arlington, Virginia. The building was designed in consultation with a professor of architecture and gerontology at the University of Southern California, and modeled after a Victorian mansion; it won the company's first of many awards for architecture and interior design. This and later Sunrise homes were a dramatic departure from the typical nursing facility in every aspect; instead of fluorescent lights, long corridors, or institutional designs, there were porches, lots of common areas, cut flowers and tablecloths, a concierge, and service to rival a hotel's. Drawing on northern European models, the Sunrise prototype incorporated the symbolic design elements of a grand staircase as "a metaphor for a mansion," Paul Klaassen explained in a 1996 Washingtonian article. "You couldn't walk into a mansion without seeing a beautiful staircase. Many of our residents are proud that they're able to take the stairs, that they have the opportunity to choose between the stairs and the elevator."

1994-2005: Redefining Sunrise As an International, Publicly Owned Management Company

In 1994, Sunrise incorporated with 30 successful senior communities. As more families embraced the concept of assisted living, it broadened its model of care to create environments with special features for seniors with special needs. Reminiscence Neighborhoods, built around Sunrise's Reminiscence Program for the memory impaired, debuted in 1995. Sunrise's Bradford Concept incorporated assistive devices and design elements to maximize mobility and independence for seniors with low vision.

Sunrise earned $34 million in revenues in 1994 and faced a major decision about the company's future course. The executive staff wanted to expand further and needed capital, $10 million for each new facility, to do so. In June 1996, the company followed in the steps of other assisted-living providers, and made its initial public offering on the NASDAQ. Its revenues for that year were $47 million.

Revenues continued to rise steadily throughout the second half of the 1990s, paralleling Sunrise's growth in homes. In 1997, the company brought in $89 million. In 1998, that number increased to $170 million. The following year, Sunrise's sales were at $255 million. As the company grew, the Sunrise management team followed a strict, yet simple formula: Develop in areas with a high number of 45- to 64-year-old adult children; avoid Texas and Florida where this demographic was low; and plan construction three to four years in advance to avoid "not-in-my-backyard" (NIMBY) issues. "It only takes one or two neighbors to oppose something," Klaassen explained in 2003 Multifamily Executive article. "NIMBYism, when combined with a willingness to spend legal dollars, can stall a project," which often required rezoning for a multifamily residence.

The company opened its first residence in the United Kingdom outside of London in 1999. It also began to sell off properties selectively that year, deciding that it was more profitable to partner with others and to manage their facilities for them. Although Sunrise's stock stumbled by 40 percent in response to the sale of its first facility, the move was timely. The mid- to late 1990s had seen an industry-wide surge in the construction of senior housing, as providers rushed in to fill a perceived need. Development, however, over-anticipated demand since the bulk of the baby boomers were not due to turn 60 until the years 2015 to 2020. It thus peaked in 1999, then dropped dramatically in 2000 and continued to drop. By the new century, there was a surplus of senior housing units and the years 2000 to 2002 represented a difficult stretch for the assisted living industry.

By contrast, while other assisted living providers floundered during the industry slump, Sunrise continued to grow. In 2000, Thomas Newell assumed the role of president of Sunrise, and the company introduced at-home assisted living. This new care alternative served seniors still capable of living on their own but needing some assistance with the activities of daily living. (The company had first introduced a home-care practice in 1985, but dissolved it in 1988 to focus all of its attention on assisted living.) Also in 2000, a year in which Sunrise earned $345 million in revenues, the company opened its first facility in Canada.

From 1995 through 2002, Sunrise opened 25 new communities a year. In the year 2001, with close to 200 communities and $428 million in revenues, it was named a "Great Place to Work" by Washington Magazine. Forbes magazine named it 141st of the 200 Best Small Companies in 2002.

Sunrise was prepared for its next big move, which it took in 2003. It acquired Marriott Senior Living Services, adding more than 120 communities to its total to reach 400 communities that housed more than 30,000 residents. The Marriott properties added more independent living and skilled nursing services to Sunrise's portfolio. Also in 2003, it acquired EdenCare, further broadening its care options. The company changed its name in 2003 to Sunrise Senior Living Inc. in order to reflect the full range of its short- and long-term elder care services.

With the addition of Marriott, revenues for the year jumped to close to $1.2 billion from $506 million in 2002, and Sunrise became the largest operator in the senior living market with a mere 2.4 percent of the entire senior housing market. The acquisition also marked another big step for the company, part of the shift it had begun in 1998 from owning and managing facilities to just managing them. Although there were signs of stabilization in the assisted living industry beginning in 2003, Sunrise began selling the majority ownership interest in all its properties. From here on out, all new developments were with partners that owned the majority of the real estate for its communities.

In 2005, Sunrise furthered its identity as a management services company when it signed a deal with The Fountains Continuum of Care Inc. to add 19 properties to its management portfolio; it obtained a minority interest in 18 of them. It also opened its first facility in Germany in the suburbs of Hamburg, and began plans to increase its U.K. presence from six to nine facilities. Back home, it joined with MetLife to develop ten assisted living communities in the Southeast, Southwest, and Midwest. Greystone Communities, a wholly owned subsidiary that Sunrise acquired in 2005, developed an additional three communities to be managed for not-for-profit third parties.

2006: Continuing Diversification and Expansion

Development continued in 2006, bringing the total number of Sunrise communities in the United States, Canada, Germany, and the United Kingdom to 423. During the first quarter alone, Sunrise opened four new communities in the United States, three in the United Kingdom, and one in Germany and assumed management of an additional three.

Also in 2006, Sunrise developed its first senior condominium project, allowing for equity ownership within a service-enriched environment that included large community areas, dining options, and a health spa with indoor pool, exercise room, and massage and treatment room.

The company also introduced a new publication, Sunrise magazine, in 2006, targeting women between the ages of 45 and 64, the vast majority of caregivers, who were likely to be balancing family, work, and the needs of aging parents. In addition to articles on inspirational topics, health, nutrition, and happy homes, the magazine offered expert advice on relationships, legal planning, and long-term finances.

Occupancy rates for senior housing of all sorts were on the rise by the mid-2000s. Community care residences averaged close to 94 percent occupancy in late 2005 as compared with 88.5 percent in 2002, while independent living facilities went from 87.5 percent occupancy to 90.5 percent. Assisted living facilities increased to 90.3 percent occupancy from 85.5 percent in 2001, and skilled nursing jumped to 89.7 percent from 83.5 percent in 2001. Investors were once again looking for a return in senior housing options and the cost of occupancy was on the rise.

Sunrise, the assisted living industry's largest player, continued to look for more expansion and diversification options in 2005 and 2006. According to Klaassen, in a 2005 Nursing Homes article, "You need to think what the next [trend] is going to be, how to make ... existing products just five percent better every year." While it was difficult to say where diversification would take assisted living communities in the future, in the years leading up to the sunset of the baby boomers, the industry and Sunrise were guaranteed to grow.

Principal Subsidiaries

Karrington Operating Company, Inc.; LandCal Investments SL, Inc.; Legacy Healthcare Management, LLC; Martha Child Interiors, Inc.; Sunrise Development, Inc.

Principal Competitors

Beverly Enterprises, Inc.; Manor Care, Inc.; Mariner; Emeritus; Extendicare Health Services, Inc.; NeighborCare, Inc.; Sun Healthcare Group Inc.


  • Key Dates
  • 1981 The Klaassens open their first facility in Oakton, Virginia.
  • 1988 Sunrise builds its first signature community in Arlington, Virginia.
  • 1996 The company holds its initial public offering on the NASDAQ.
  • 1999 Sunrise builds its first community in the United Kingdom.
  • 2000 Thomas B. Newell becomes president of Sunrise; the company opens its first community in Canada.
  • 2001 Sunrise stock moves to the New York Stock Exchange.
  • 2003 Sunrise acquires Marriott Senior Living Services; the company changes its name to Sunrise Senior Living.
  • 2005 Sunrise builds its first community in Germany.

Additional topics

Company HistoryHealth Care

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