We are unpacking how REITs support senior living operators, plus hear insider details into the recent proxy fight with an activist investor straight from Eric Mendelsohn, CEO of NHI. Don’t miss these valuable lessons from an industry leader on serving partners and working toward mutual success.

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This episode was recorded at the 2025 NHI Symposium.

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Produced by Solinity Marketing.

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‍Become a sponsor of Bridge the Gap.

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Listen to more episodes here.

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Intro

Welcome to season eight of Bridge the Gap, a podcast dedicated to informing, educating, and influencing the future of housing and services for seniors. The BTG network is powered by sponsors, Aline, NIC MAP, Procare HR, Sage, Hamilton CapTel, ServiceMaster, The Bridge Group Construction, and Solinty and produced by Solinity Marketing. Bridge the Gap in three, two.

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00:36 - 00:54

Lucas McCurdy

Welcome to Bridge the Gap podcast is senior living podcast with Josh and Lucas. Beautiful day here in Nashville at the NHI Symposium in the West End. It's a great day and we have our friend and returning guest. Welcome, Eric Mendelson, CEO of NHI. Welcome back to the show.

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00:54 - 00:56

Eric Mendelsohn

Great to be here. Thank you for having me.

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00:56 - 01:25

Lucas McCurdy

It is so good to see you. And thank you for inviting us here, because your guest list, not surprisingly, is star-studded VIPs. And we're given special access from Eric and his team and Cameron Bell to interview and get such great thought leadership here. While y'all are sharing ideas, sharing experiences together. And we're really fortunate to be here. Big day ahead.

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01:25 - 01:35

Eric Mendelsohn

Having you here makes it special for us as well. It lends a little red carpet feel to our event. So I know our operators love that.

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01:35 - 02:06

Lucas McCurdy

And there's a lot of history between you and Bridge the Gap that. You know, this is our eighth year. We have a lot of new listeners that people don't know. Eric is one of the first people to really help bolster and get Bridge the Gap the fuel, that gasoline. He was our first sponsor and one of the first big people in the industry to really believe in this educational platform that brought thought leadership in our industry to the forefront. What sparked that, that desire to want to help us out?

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02:06 - 02:35

Eric Mendelsohn

I really thought you guys were on to something. I really thought that the industry needed this cohesive show that covered all the topics. And, you know, obviously we had the pandemic, and you were kind of a friendly voice for everybody, comparing notes, reporting from the front lines. I mean, it was really good timing on your part to be a friend of the industry when we needed one.

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02:35 - 02:46

Lucas McCurdy

Appreciate that because that really helped us in that first season and gave us kind of like the validation, like, I think if Eric believes we're on to something, then we must be on to something.

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02:46 - 03:18

Josh Crisp

Yeah. Well, and, you know, if you think back that long ago, over eight years ago, there was no podcast at all in our industry. So, Eric, just to have the forethought in the forward thinking pioneer mind to that, this is something that the industry needs, and, and equipping and enabling us, to, to guys with a lot of energy to be able to, to afford to even be able to bring this level of content to the industry, says a lot about you and how you think about the industry and the investment you make. So we always have to be sure to thank you for that.

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03:21 - 03:25

Eric Mendelsohn

Well, success has many fathers, so I'll take a little bit of credit.

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03:26 - 03:46

Lucas McCurdy

You're always you have the greatest one-liners. So. Okay, we're going to get into some news. But first before before the breaking news, tell our listeners what, if there were, that aren't able to be here. What are your operators and your partners in for today at the NHI symposium?

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03:46 - 05:17

Eric Mendelsohn

Well, a lot of people wonder, what does a REIT do? Why? Why be a REIT? And when I try and explain to people outside of senior living, I think of us as a big club. And you're a member of this club, and once you're a member, you can get special rates on carpeting or insurance or labor technology, or accounting technology.

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We try and be resourceful because being an operator is tough. And a lot of times you feel like you're going it alone. And we try and be a clearinghouse of information, a shoulder to cry on, a booster, a problem solver. Granted, a REIT can't solve all your problems or give you spiritual fulfillment, but we will do our best to find you a way to get there.

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And because we deal with 30 or 40 different operators as our customers, we have a lot of information we can share. Obviously, if it's proprietary information that you've developed as an operator, we'll keep that confidential. But there are a lot of systems, a lot of techniques, a lot of ideas out there that other operators want to share. And this is a forum for that.

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There's a lot of programming in this symposium, but there's also a lot of downtime and camaraderie and networking that happens. And I know our operators appreciate that, being able to compare notes and have access to each other.

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05:17 - 06:23

Josh Crisp

Well, and we've heard that we've already heard that, boots on the ground here with the operators that are coming in. We heard a great testimonial from one of your operators that's a long-time veteran in the space that's been a partner with you all. And we were talking about the great opportunity because senior housing is gaining popularity.

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It is growing. More people are talking about it and other verticals, investors technology are entering our space, which is great, but it creates a unique challenge for the operators who are boots on the ground, trying to just take care of residents and their families and coordinate services and care, to where you don't know who to trust sometimes.

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And we're looking for trusted partners that will not just be there to sell you the product, but to service it. And so we've heard story after story that the NHI team is a great resource. Having, already vetted many of those partners, which is a great service to the operators, that just improves the quality of care to our residents. So, kudos to your team. It's exciting to see what's happening here in Nashville.

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06:23 - 06:38

Eric Mendelsohn

We try not to have an agenda. We try not to have ulterior motives other than that we'd like to do more business with you. And we'd like you to succeed. Because if you succeed, we succeed. So that's what today's all about.

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06:38 - 06:57

Lucas McCurdy

Well, we're looking forward to participating in that. Okay, so outside of that NHI has been in the news a lot lately. You've had a lot of work on your hands there. Bring us into the fold. Tell us, give us some of the, you know, some of the inside stuff.

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06:57 - 07:01

Eric Mendelsohn

Sure. It's not like we're on a podcast or anything.

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07:01 - 07:04

Lucas McCurdy

Give us all the dirty secrets, please, Eric.

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07:04 - 09:20

Eric Mendelsohn

So I think what you're referring to is NHC, as a publicly traded company, we’re traded on the New York Stock Exchange, and we have shareholders, and we recently had a shareholder who was not happy with some of the things that, our company was doing. So he bought a position, and he was very vocal about it.

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And he tried to get some board members on our board. Like a lot of companies, we have annual elections of board members. And, in this instance, our board members were up for election every three years, which is very common. He would like our board members to be up every year.

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So we agreed to that. But he was not to be dissuaded. He wanted his own board members. So we ran a contested election, which is very interesting. There are mailings, there are advertisements. All of our shareholders received proxy cards you vote. Just kind of like mail-in voting. So it was, very odd to be on the inside of that, to see your name on these cards and see him talking about our board and our company and, you know, this guy is a shareholder who wants us to succeed.

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So I feel like his heart was in the right place. But maybe his methods were a little aggressive. So we spent a lot of time talking to our large institutional shareholders. What's an institutional shareholder? Those are names you probably know. Vanguard, Fidelity, Charles Schwab. State Street, Prudential. They're big insurance companies and investment funds that have large positions in our company.

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And in fact, they have large positions in every company. So, we had multiple discussions with them, telling them our plan for the company and why they should vote for our directors. And in the end, that's what happened. We were able to get our slate elected. And the activist slate was not elected. So, it was a learning experience for everybody.

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09:20 - 09:21

Lucas McCurdy

That sounds complicated.

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09:21 - 09:50

Josh Crisp

It's very complicated. Well, you know, one thing, you know, there are so many different things. I'd love to have time to talk with you about it, because I really find it very interesting. The different hats that you have to wear as the CEO. You're in those boardrooms. The war room, so to speak. But then you're here, you know, every operator I name, I've seen you. I'm amazed how you remember all of these operators

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09:48 - 09:50

Eric Mendelsohn

You're wearing name tags.

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09:50 - 10:16

Josh Crisp

Well, that helps. But many of them, you're greeting before they even get to the table, and I see that. And so, that doesn't go unnoticed. You're very connected with the actual communities and the operators. How do you find the balance, and what motivates you to find that balance between those hats? You've had a long, already storied career, but what gets you motivated to get up and do those things every day?

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10:16 - 11:45

Eric Mendelsohn

Great question. Thank you. I would say, like a lot of men, I'm very good at compartmentalizing. So, in the morning, I might have been dealing with an activist situation. And in the afternoon, we might be talking about an operator that wants to expand their business or is having problems, or having a legal issue or regulatory issue.

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So you do wear a lot of hats. And I would say that NHI is still a relatively small company. So we all wear multiple hats. Someone once called me a Swiss Army knife because I have an operator background, I have a legal background, and now I'm an executive, and I have a capital markets and corporate background.

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So, you just exercise those muscles, like a triathlon, and you get used to one exercise or the other. And it seems fairly normal to be in front of investors in the morning and then maybe visiting a building in the afternoon. And, you know, my joy is interacting with residents and operators who are happy, who are content, who are fulfilled, and are living out their days with friends and family and good food and activities that stimulate them. So that's what it's all about.

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11:45 - 13:02

Lucas McCurdy

There's so much complexity in senior housing. This is not just a real estate asset. It's not just a place where people might live and pay rent every day. There's a lot going on. There's care, there's dining, there's activities. It's a complicated business. And, there's also, I think, a bit of a gap between an understanding of the day-to-day operations from the operator and their landlord, the REIT that owns the building.

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And I have been fortunate, I have toured many, many buildings with different REITs and private equities. And I get to see the response, and I get to see some that are, when Cameron walks into a building, they're excited to see Cameron. Right. And because Cameron visits a lot of buildings. Right. But I've also been on some walks where people walk in and everyone just scatters, and they don't know what is going on.

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Why are these well-dressed men coming into this building? Who are these people? Everybody run! Everybody look alive. Right. And so, tell us, help bridge the gap for some of our listeners out there that may say, you know, we had a visit from our landlord one day, and it was a little scary. And I really wasn't quite sure what to do.

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13:02 - 14:14

Eric Mendelsohn

I agree, I do my best to defang myself before I enter a building. A lot of times, I'll take off my sports coat if I'm wearing one, and I'll chit-chat with whatever staff I come into contact with right away. Try and put them at ease. A lot of times, you're waiting for an executive director to come greet you because they're busy on the phone or something, and I'll spot a resident.

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A lot of times, especially in good weather, the residents will congregate outside in rocking chairs or on a porch. And they're very curious about the comings and goings of people, especially people who look somewhat professional. So, I'll entertain them. I'll just stand outside and chit chat with them. And I think that sends a message that you're you see the residents as people, not just a rent check. And, it also signals to the staff that you're focused on the right part of the business, not just whether or not the carpets are in good shape and the paint is not scuffed.

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14:14 - 14:42

Josh Crisp

So, Eric, obviously in your position, you want great operators, you want them to be very successful. I'm assuming here at this symposium, a big part of that is adding to that success, adding value. Biggest challenge you see ahead for operators, and will that be something that's being talked about here today? What do you hope is taken away from today?

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14:42 - 16:05

Eric Mendelsohn

The biggest challenge and biggest opportunity, I think, is technology. And I'm not going to say I, because we're still figuring out what that is. But, there are all sorts of cool technologies, whether it's nurse call systems, whether it's phone monitoring, whether it's some sort of virtual entertainment or connectivity, or customizing your lunch on a menu. And I love all of that, and I appreciate that.

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It's tough sometimes for residents and caregivers to keep up with that. But I think if it's done right and if it's user-friendly, it can really add value and enhance our residents' lives in a way that makes a difference. So we talk about things like that here at our symposium. We invite certain vendors to make presentations that we've discovered that we think are worth knowing.

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You know, we get no compensation for that. We have no investment in these companies. We just like them, and we invite them. So, that's the type of club atmosphere I was talking about earlier, where we try and be problem solvers, we try and be influencers, we try and be helpful. In more ways than just being a capital partner.

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16:05 - 17:03

Lucas McCurdy

So, kind of rounding out some of the questions. I cannot let you go. Well, we know you have a busy schedule, but I don't want to let you go before I ask this question. So, NIC MAP is one of our big, sponsored partners. And so we do a quarterly data podcast with them, and all the information that you already know.

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16:23 - 17:03

Lucas McCurdy

So, clearly, development has been at a standstill for a number of years. Demographics, demand is on a big, big rise. It's actually here. The thing that you've been talking about your whole career is actually here. And so, from a REIT's perspective, is there a kind of land grab going on? It's like anything that's available. You're going out and getting. Are you still heavily vetting only the right, perfect buys, or are you looking at big portfolios, small portfolios? I mean, how are you going to navigate these next couple of years where we're eventually going to be fully occupied as far as the.

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17:03 - 17:04

Eric Mendelsohn

According to them.

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17:04 - 17:08

Lucas McCurdy

According to NIC MAP. What's your strategy?

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17:08 - 18:32

Eric Mendelsohn

Land grab is a good explanation and a good description of what I think is happening with a lot of REITs and private equity. And I would say no, we're trying to be a little more intentional. We're trying to curate what operators, what buildings, and what markets we get into. We learned a lot of hard lessons during the pandemic, and a lot of times, the land grab strategy can backfire, and you can find yourself with a hangover from having had too much of a land grab.

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Okay. So we went through that like a lot of REIT, and we did a lot of calling of our portfolio. And I like where we are now, but you're absolutely right. There is a lot of transaction activity. And not only is construction slowed down, but banks are somewhat on the sidelines. Interest rates are as high as I've ever seen them since I've been in this business for banks.

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00:18:12:11 - 00:18:32:11

Eric Mendelsohn

So that's a great opportunity for REITs, where all of a sudden a capital partner that makes economic sense, makes cultural sense with a lot of operators. So, you know, we intend to take advantage of that. And, do what we can to get our small piece of land.

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18:32 - 18:33

Lucas McCurdy

That makes sense.

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18:33 - 18:54

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Josh Crisp

Well, what a great opportunity to sit down with you, Eric. Appreciate you taking the time on a very busy morning. Guests are arriving. Energy is increasing. We know you've got a big task today. As the host, for all of this. So thanks for taking the time for us and investing in us and investing in our industry. We really appreciate you.

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18:54 - 18:57

Eric Mendelsohn

Well, Josh Lucas, it's my pleasure. Thanks for having me.

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18:57 - 19:10

Lucas McCurdy

Awesome. Well, to our listeners who love this episode, and we have many more, go to btgvoice.com. Connect with us on LinkedIn. We'd love to hear your thoughts and opinions on this. And thanks for listening to another great episode of Bridge the Gap.

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Outro

Thanks for listening to Bridge the Gap podcast with Josh and Lucas. Connect with the BTG network team and use your voice to influence the industry by connecting with us at btgvoice.com.

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