Holiday Retirement lifted new-lease revenue 9% by pricing rooms like airline seats

Holiday Retirement, the largest private owner and operator of independent senior living communities in the US, ran more than 300 properties with roughly $1 billion in annual revenue. Its pricing was set through continual negotiation between corporate staff, local staff, and prospective residents, which produced inconsistent rents and lost revenue.

Holiday partnered with Prorize, which built the Senior Living Rent Optimizer (SLRO), the first revenue management system in the senior living industry. Borrowing the forecasting and optimization machinery airlines use for seats, SLRO recommends an optimal rent for each unit in every community and gives corporate a consistent, proactive pricing process.

The measured results: revenue from new rentals rose $88 million, about nine percent, after full deployment in 2014. Prorize reports $85 million in the first two years, a 9.3 percent average boost, with an estimated $304 million over five years; McKnight's later cited a consistent 10 percent revenue increase from new leases.