With 340 locations and roughly $480 million in 2019 systemwide sales, BrightStar Care is seeing solid results in the in-home care franchising arena. In addition to that proven model, the Chicago-based company is now also looking to grow its senior living operation.
Currently, BrightStar has three “BrightStar Senior Living” communities up and running in Wisconsin and Indiana, founder and CEO Shelly Sun told Home Health Care News.
The franchiser has two more that are already under or nearing construction in Michigan and Ohio.
BrightStar hopes to open the two new constructions by the first or second quarter of 2021, Sun said. After that, the company’s goal is to probably open two to three locations per year over the course of a two- to three-year period, then scale construction to five new communities per year after that.
“We see a lot of the families that we work with that might eventually progress to needing and asking us for a recommendation to a higher-acuity assisted living or memory care community,” the CEO said. “And we wanted to be a part of our family’s journey throughout their lifetime, so we saw this as a natural extension of our brand.”
Although BrightStar Care’s senior living plans are ambitious, they’re somewhat scaled back compared to what the franchiser was initially shooting for.
In 2015, BrightStar outlined a five-year plan for 100 franchised communities by 2020.
A standard BrightStar Senior Living community is homelike and contains between 35 and 45 units, with assisted living on the first floor and memory care on the second. The communities typically carry a total project cost of about $8 million to $10 million, with rates generally on the “upper end” of the local market, VP of Franchise Development Pete First previously told Senior Housing News.
“It works well for us because we have the franchising experience,” First said in August. “I don’t think it’s very common [to have] franchising knowledge plus an understanding of health care. We just have a natural niche.”
BrightStar — founded in 2002 — provides both medical-level in-home care and non-medical home care services. In addition to those services, it also offers hospice care and runs a medical-staffing segment.
Each independently owned and operated BrightStar Care location is required to pursue Joint Commission accreditation, a point that reflects its deep health care understanding.
Generally, BrightStar’s senior living franchise model features royalty fees of 5% of revenue and 10-year renewable contracts for franchisees. In return, the company guides its franchisees through the development process, helps source financing and supports operations once they get off the ground.
“For many of our franchisees, this is a great wealth planning strategy as well, to continue doing something they love and make a difference in their community but also have real estate as part of their expansion strategy,” Sun said. “We don’t look at it as an institution, but rather the community. We think of it as almost like moving from home to a bed and breakfast — with the highest quality of care, coupled with the highest dining and activity standards.”
Sun and her husband invested $6.5 million of their own money to get the first BrightStar Senior Living community built and operational.
BrightStar, of course, isn’t the only in-home care franchise giant to explore new models tied to real estate.
Just one example: In 2018, Baltimore-based Senior Helpers launched its first Town Square location in San Diego. Town Square is an adult day franchising model designed in partnership with the George G. Glenner Alzheimer’s Family Center around reminiscence therapy.
Broadly, Town Square locations take clients back to the 1950s using carefully designed scenes and dozens of “vignettes” — stations that recreate old-school diners, movie theaters, hair salons and more.
“I love the concept,” Senior Helpers CEO Peter Ross previously told HHCN. “This is my fourth franchise brand, I think this has got as much a chance as any of the ones before, including Senior Helpers, of being a home run.”
BrightStar Care and Senior Helpers are predominately in-home care organizations that entered the senior living and adult day spaces. But the reverse has frequently happened as well, with many senior living providers actively building in-home care divisions to help diversify revenue and target prospective residents earlier.
Additional reporting by Tim Regan