Stellar Senior Living Co-Founder and Senior Vice President Adam Benton believes his company has its best-ever opportunities to expand in 2025 and beyond.
Midvale, Utah-based Stellar is on a mission to enrich the lives of 10,000 senior living residents, families and employees by 2030, a Benton believes the organization can reach through measured growth.
“As far as Stellar goes, this is probably the most opportunities to expand and grow that I have seen in the time that I’ve been operating, and I think it’s a mix of market conditions as well as our tenure and size,” he told Senior Housing News during a recent appearance on the Transform podcast. “I think everyone’s used to the fact that interest rates are high and yet we still have a lot of continued demand for senior living, so that combination has been showing itself in the first half of 2025.”
Now at 37 properties in nine states, the operator has steadily grown its senior living portfolio since the company’s inception 14 years ago. In that time, Stellar has built relationships with institutional capital partners including real estate investment trusts (REITs) Diversified Healthcare Trust (NYSE: DHC) Welltower (NYSE: WELL) and Ventas (NYSE: VTR), along with Harrison Street and Bridge Investment Group.
Stellar’s methodical push toward a portfolio of approximately 60 properties by 2030 rests on three things: Family ownership, the company’s ability to quickly and strategically turnaround distressed assets, and Stellar’s past ability to partner with large institutional capital partners.
“Our goal is to get to about 60 properties and then really just be thoughtful about making sure we maintain quality,” Benton said.
In 2024, Stellar launched a $25 million joint venture and equity effort to fuel future growth. The first transaction from the fund is set to close later this year, Benton confirmed. New this year, Stellar sold two Class A senior living communities to Welltower (NYSE: WELL) while remaining on as manager of both sites located in Utah markets.
Listen to the full episode below. The following interview transcript has been edited for length and clarity.
On Stellar’s geographic and portfolio makeup:
Stellar Senior Living is a privately held family business. I am one of the partners, with my brother in law and my dad, so it’s the three of us and we started this 14 years ago. It’s been a fun journey. We’re based out of Salt Lake City with 60 corporate professionals and we’re located in nine different states. Our biggest footprints are Colorado, Arizona and Texas.
Those are large locations for us but we go all the way from Washington, Montana, Wyoming, Idaho, Utah, Colorado, Arizona, New Mexico and Texas. So we’re very regionally focused and we actually do span the entire country if you go north to south.
On operations in 2025:
There was a real shift in mood at the NIC Conference at the end of last year, it was the D.C. conference, and I remember attending that and it had been a little gloom the last couple of years, and it just felt like things had switched a little bit.So, we came back and really focused strategically on the fact that there’s going to be more growth and opportunities here than we’d seen historically. How do we position ourselves for that?
As far as Stellar goes, this is probably the most opportunities to expand and grow that I have seen in the time that I’ve been operating, and I think it’s a mix of market conditions as well as our tenure and size. Payroll issues have subsided. I think everyone’s used to the fact that interest rates are high and yet we still have a lot of continued demand for senior living, so that combination has been showing itself in the first half of 2025.
On Stellar’s $25 million JV, equity raise:
We announced last year that we were raising a joint venture to do a GP position in senior housing.It was $25 million and it came out of the response of the 2024 NIC Conference, and it’s going great. Our first transaction will be in about 60 days with that and so that actually officially closes the fund and we’re just off and running.
Historically, we operate everything but we like to align our interest by co-investing with our partners and these are expensive properties to purchase and so we realized that our ability to just deploy our own capital is going to be outstripped by the demand so that’s what started this joint venture partnership and it’s been going great. We had to learn a lot really quickly on how to do that and I’ve been overwhelmed by the support that we’ve received so far, not just what they say, but willingness to invest with us and I am excited for that. I think that’s just a new chapter for Stellar.
On three reasons Stellar’s model has grown:
If you take a step back and look at stellar, the three things that make stellar unique are, one, that we’re family owned and operated, we’re a privately held business, and we’re an AB LLC, that means that we’re a quasi nonprofit-for-profit in that we have more motives than just financial performance.
We’re actually really good at turning around properties. So, if a property is struggling and occupancy is down, or maybe it’s not returning additional capital down to the bottom, or the quality of that property is lacking, that’s something where we come in and take a lot of pride in getting those properties going the right direction. We actually have a very simple three-step process for doing that, but it takes a long time to complete.
We make sure we build the team right and then we really focus on filling the property throughout with occupancy and then we work on building operations which are continually improving and ongoing. We grade every one of our properties each week on that so every one of our executive directors knows where they stand in those stages. We take a lot of pride in that because, ultimately, it improves the lives of the residents and employees at those properties.
The third thing that we’re really good at is that we partner with large institutions. These are public entities that require a lot in regards to communication and reporting and standards, so we have just a very good set of partners, including Welltower, Ventas and Diversified Healthcare Trust, and then groups like Harrison Street or Experience Senior Living. These are groups that all require a level of reporting that’s usually not something privately-held, family businesses can offer, but it’s something we’re really good at and we’re proud to be able to have those as partners.
In that short time, we’ve learned a ton from [Welltower] in terms of just reporting and what’s required there has really leveled us up and it’s something that when we look at our operations, we know that our partners make us better.
On Stellar’s future growth:
As far as growth goes, you’re always trying to improve. Take two buckets: one is a mom-and-pop business, the other is a large institution. There are pros and cons to each. With a mom-and-pop business, you get amazing customer service, but it’s not scaled and consistency might be all over the place. There are downsides. If one person leaves, the whole business can fall apart. On the other end, think of large institutions. The pros are good consistency, a lot of people involved and scale. The cons are less personal touch and sometimes quality drops because they’re moving toward an average.
We believe we can pick the best parts of a mom-and-pop business and the best parts of a large institution and combine them. That’s what Stellar is. No outside institutions say you need to keep growing or add shareholder value, so we can pace growth in a way that makes sense and pick the best pieces of both.
On future development:
Looking at development as a whole, it is something we want to continue to do. We want to provide additional units to the market. It’s easy to see that the demand for senior housing continues to grow. A lot of real estate industries you look into and go, ‘What does office look like in the future? What does retail look like in the future? What does hospitality look like?’ You’re squinting and saying, ‘I think there’s going to be demand. I don’t know.’ Senior housing is just demographic trends. It’s an easy calculation to say, yes, there’s a lot of demand for senior housing. That’s a straight line that goes up for 20 or 25 years.
The challenge is layering on top of a real estate cycle, which does not look strict. It looks like this. It’s going to keep going up, and matching those up is really challenging. Right now, in general, senior housing properties are selling for below what it costs per unit to develop. That’s difficult.
So how do you make it work where you can build a new property and have it support itself through rents? It’s really hard. Then you layer on tariffs. It gets harder. That will correct itself over time, just as any real estate cycle does. But you could imagine doing the math and going, ‘Okay, the returns look like this in construction, and we can buy this other property and the returns look like this.’ It’s less risky to buy an existing one than to build one, so it’s hard to get people aligned and say, ‘We can do this for you.’
That [Boise, Idaho] property we bought actually in March 2020, so we’ve held it for a while. We put pencils down. It’s a five acre beautiful parcel. It’s 146-unit assisted living, but we’ve got it back and going, and we’re putting everything together to start building it. That’s where that property is. We are seeing some market dynamics where we’re getting in the early stages of development with local developers.
If you and I wanted to develop a property right now, and we looked at a piece of ground and it’s just dirt, you’ve got one or two years of entitlement, one or two years of building, and then two years to fill. It’s a six year deal. By the time it’s fully stabilized, we’re talking 2031. It’s a different world at that point. That six year cycle is what creates the boom bust in real estate in general. It’s hard to make those decisions that will have ultimate stabilized consequences in five or six years.
On Stellar’s future size and scale:
We’re at 37 properties today and we’ve been in business for 13 or 14 years now. It’s honestly been three to four properties a year. It’s very consistent. We’re now getting to the point where for the first time, in the last 12 months, we’ve actually had properties come offline.
Our growth right now, our 2030 goal is that we want to improve the lives of 10,000 people by 2030, so that’s residents and employees. When you look at what that might look like on a community basis, that’s about 60 properties. The whole company knows that, so our goal is to get to about 60 properties and then really just be thoughtful about making sure we maintain quality.
Our thought is around six to eight properties a year, but we can digest that now because we have the team to do it, whereas before, we couldn’t. So, this is new for us in terms of a percentage of total properties and regions and support staff and teams. We think we can do that without affecting the culture. But that still takes time, and we have time. When we look at that from a workload finance perspective, the word opportunistic is correct. You have to be able to take on a lot of different problems. They’re not always the same. I wish it was just a conveyor belt of doingX,Y, Z and it improves. But each property we bring into the Stellar portfolio has unique circumstances, and we have to customize a strategy for each one.
Before we bring a property in, we underwrite it. That means doing all the financials as if nothing is going to happen. So if it’s 70% occupied, we underwrite it as if it’s going to stay 70% occupied, flatline. Instead of just our financial analyst team saying what to do to improve, we bring in our operations team and start making one assumption at a time. We ask, can we improve occupancy? How do we believe that, and by how much? Then we make that assumption change, take that note, and it slowly ticks up. We ask, can we do a better job managing food expenses? Great, it ticks up.
We keep working until we’ve made all the changes we believe in, and it goes from a flat line to something that’s actually improving. Each time we make an assumption change, we take a note. In our pro forma, we have a set called strategy notes. That is the guiding light for how we turn the property around. Then we show up every day and try to figure it out. We’re going to be wrong on a few. Out of 15, there might be five that don’t work when we get into it, but overall, we get them to move and go in the right direction.
When we look at the types of properties, we think they have to be over 100 units. They generally have to be in a populated area. We have to be able to fly in and out in the same day. From there, it has to be predominantly independent, assisted living and memory care, and private pay. If we have those five, we’ll take a good look at what we can do to turn them around. We build strategy notes, have our team involved, and that’s our strategy going forward.
Then you have years in front of you to make sure that happens. It does not happen overnight. We start with a team, then build occupancy, then build operations, which is expanding the margin. By the end, hopefully you’ve improved some lives, added more jobs, added more residents, and the quality of the service is better. That’s what we do.
On staffing in 2025:
You’ll never hear us complain about staffing. It is part of the job, it’s the number one job. To complain about it is like, what are you doing then? But you hear a lot of people complain about staffing. It is part of the job. There’s a level of turnover, a level of building leadership and training that leadership.
We’re going to meet the market where it’s at and do the best we can. We do have a few things we do that are proprietary to us that get us ahead in staffing. We believe strong leadership at each property tends to solve a lot of problems and build great teams. We have systems and processes to make sure we have at least three backups in every market that can step in if we have an open leadership spot. That’s the person-in-the-pocket concept.
We build good technology around making sure we have those three backups. More importantly, we take the time to build the network and build relationships with those groups.
On outlook for the senior living industry:
Things are going to continue to look brighter. We’re still going toward the summer solstice. Every day gets a little brighter and better. I think we’ll see that, and I’m excited about it. One thing the senior living industry could do differently is recognizing the importance of patience in growth. That has an effect on the residents, so making sure it’s done properly and in an order that makes sense, while keeping the resident in mind at the end. That’s something I would love to see across the industry.
