Experience Senior Living President: Development Demands Solving Financing Rubik’s Cube, Creating A Community Before A Building

Editor’s note: You can hear more from senior living executives, including Experience Senior Living President Phill Barklow, on the topic of ongoing development at the upcoming (RE)BUILD conference.

Experience Senior Living is pushing ahead on its development pipeline of new communities in key markets across the country, with the organization pivoting to meet the needs and preferences of an evolving senior living customer base.

To do so, the company has had to get creative in assembling capital stacks, which President Phill Barklow compares to solving a Rubik’s Cube.

Experience also is taking a new approach to sales and marketing to drive lease-up of new developments, starting earlier to “create the community before the building is even built,” Barklow said on a recent episode of the Senior Housing News Transform podcast.

The current development push spans Experience Senior Living’s multiple brands, from middle-market to luxury offerings.

Projects underway for Experience include developments in Colorado, Maryland, Washington D.C. and Florida, all of which took nearly a decade to get off the ground, Barklow said.

Experience Senior Living’s parent company, the NexCore Group, along with Experience’s in-house design team, combine market analytics and seek resident feedback to drive future design.

“The constant feedback was clear: Residents want amenities, to feel valued, and to have a sense of purpose. That’s aligned with our company’s vision to create communities with purpose,” Barklow said.

With 44% of properties surveyed in NIC primary and secondary markets being on average 25 years old, Barklow said the industry must move faster to meet incoming demand with innovative design based around these resident expectations.

Below are highlights of the podcast interview, edited for length and clarity.

On the 2024 development climate:

As you know, development takes time. These projects we’ve been working on, some of them go back eight, nine, ten years. Relationships were built, and master developers have been working on these incredible sites to get them entitled. It’s been a lot of hard work.

We’ve got an incredible team here at Experience Senior Living and Experience Senior Living Development working on the design, marketing plans, how the buildings flow, and all the great feedback from our current residents, prospects looking to move in, their families, and the focus groups we’ve had. It’s exciting to think about what the future of senior living looks like from a development perspective.

The capital markets have been top of mind for everyone. Expectations have been up and down, and there were times when we thought maybe this isn’t the right time for development if the capital markets can’t support it. But we’ve found that, as we ease out of some of the challenges with the Fed’s interest rate adjustments, we are positioned as one of the few in the space ready to go into full growth mode with new developments.

On Experience Senior Living’s development pipeline:

We have a more traditional senior living approach with assisted living and memory care, typically around 100 to 130 units. These are usually suburban properties, built with stick-frame or masonry construction, offering a classic senior living experience.

We also have an independent living, assisted living, and memory care brand called the Gallery Collection, which focuses on urban-adjacent areas. These buildings are larger, with 150 to 300 units, located near urban environments to facilitate access for employees, families and residents.

Our most prestigious brand is the Reserve Collection, which features urban, high-rise developments. We are launching three of these in the next 90 days and are excited about expanding this brand. We’re about to open our first Reserve property in South Denver, in a town called Lone Tree, which has been very well received.

Additionally, we have an active adult brand called Active 55, focused on age-restricted multifamily apartments with limited services but extensive amenities.

Currently, our development focus is on the Gallery and Reserve Collections. You mentioned the three projects in the D.C. metro area; we’ve announced two of them. We expect the Falls Church community to break ground within the next 30 days, and the Reserve at Strathmore Square in North Bethesda should break ground in the next three to four months. We’re also breaking ground on a Gallery property in South Tampa next week, one of our larger Gallery communities, along with another Reserve Collection project in Florida, which I can’t fully disclose yet.

It’s a busy pipeline for the next six months, but we’ve put in a lot of hard work to ensure we can hit these groundbreaking targets and execute our plans.

On Experience’s vertically integrated development company, relationship with NexCore Group:

We’re vertically integrated across the board. As part of NexCore Group, the largest healthcare developer in the United States, we benefit from a wealth of insights and a strong team on both the ESL and NexCore sides.

I’d like to say we slow down to move faster, but being vertically integrated with our operations team allows us to get direct feedback from our residents and prospective residents. In fact, the feedback from prospects who don’t choose to move in with us provides valuable insights into what’s missing in the market and why they aren’t ready to make this decision, whether it’s with us, our competitors or staying at home.

These focus groups, along with input from our employees, are invaluable. We gather feedback not just from salespeople and executive directors, but also from frontline employees about why they choose to work with us, what motivates them, and why they come in every day. Attracting and retaining top talent is a priority for us, which is why we’re focused on development. Many older communities available for acquisition are not ideal in terms of location or design to meet the needs of our new clientele, both residents and employees.

Our vertical integration eliminates the typical communication gaps you see when you have separate owners, developers and operators. Without the “telephone game” effect, where feedback gets distorted by different interests, we’re all aligned as one team. We aim to get it right, move the needle forward in the industry, and ensure our employees are engaged and motivated to grow with us.

On using resident feedback to provide future design insights:

From an amenity and location standpoint, we received a lot of feedback about the desire for intergenerational, diverse cultures, more urban environments, and walkable, independent settings. The constant feedback was clear: residents want amenities, to feel valued, and to have a sense of purpose. That’s aligned with our company’s vision to create communities with purpose.

When we hear from residents and their families, they emphasize that they’re not looking for a traditional retirement community where they just sit idle. They want to live active lifestyles, stay engaged, and remain part of society—something they’ve always done. We hear the same desires from prospective residents as well.

Interestingly, when we started discussing development in the D.C. market, prospective residents were reaching out to us. They heard about it and did their own research. That’s what you get with the boomer generation. They called to ensure we had the amenities and design features they were looking for, even while we were still in the design phase.

Having been in senior housing for 31 years, I’ve seen the clientele change significantly, and I’m excited about this shift. It’s now more of a partnership—you’re not just building and hoping people will come. Instead, you’re co-designing it together, building a community and a sense of purpose collaboratively. It’s been a rewarding process.

On changes to design in recent senior living development:

I don’t mean to offend anyone, but our asset type has progressed very slowly compared to other real estate sectors. Offices have changed dramatically, multifamily has evolved significantly, and you can see this trend across various asset types. However, senior living has been slow to evolve, transitioning gradually from serving the Silent Generation and the Greatest Generation to now addressing the needs of boomers. I do think that boomers, along with some forward-thinking developers (myself included), have pushed design innovations. But it’s really the consumers—residents, their families and team members—who are driving these changes. Their expectations are different, as is their willingness to pay for higher-quality experiences, which is great.

From a design perspective, urban environments have become increasingly important, especially those near great retail and cultural events. That’s why I’m so excited about the Strathmore community. It’s right next to the Music Center at Strathmore Hall, the second busiest concert venue in the Mid-Atlantic. It’s a fantastic location for our residents.

Regarding apartment sizes, our track record shows that larger units sell out first. In fact, many of the deposits we’ve received for projects that haven’t even broken ground are for these larger apartments. When I started 30 years ago, I remember working in a community where 10 residents shared one restroom. We’ve come a long way since then, but some are still building small studios with two unrelated people sharing a space. Pre-Covid, that was a tough sell; post-Covid, it’s nearly impossible.

Feedback is crucial for us. We focus on understanding what potential residents need to make the decision to move, and more importantly, when they’ll make that move.

We aim to encourage people to move before it’s a necessity due to health issues or pressure from family. With 5,000 to 6,000 people turning 80 every day in this country next year, and 10,000 turning 65, our goal is to engage the younger cohort—those in their 60s and 70s—who are making proactive decisions about their living arrangements. That’s truly our end goal.

On major differences between last year’s development climate as it compares to this year and 2025:

We closed our last deal in December of last year, which was probably the most challenging time in my career to get anything done. But we made it happen with creative capital partners, a lot of hard work, trust and communication. However, we haven’t closed anything yet this year. That’s been the difference. I haven’t seen many groundbreakings in the industry at all in 2024, and while there were several in 2023, it’s still not as much as we need or what we’ve seen in previous years.

As I mentioned, we have a pipeline, and we expect to execute on four projects before the end of the year and two in the first quarter of next year. The creative capital solutions we’ve pursued, going beyond traditional industry capital partners, have been where we’ve found success. There are many people intrigued by this industry, and it involves an educational process.

Typically, when working with those who’ve been in this field their entire careers, they know what they like and don’t like, which operators and locations work for them. But when you bring in partners from outside the industry, you’re essentially starting from scratch. We’ve found some incredibly smart real estate capital partners who are excited to be in this business with us.

The main difference now is getting both debt and equity partners off the sidelines and into the game, responding to the demographic trends that are impossible to ignore. The demand is real, and we have to react to it.

On developments versus acquisitions:

I want to be intentional about this. I think everyone sees the opportunity in front of us with the current supply-demand imbalance. We’ve discussed this before—the vast majority of properties in most markets are at least 10 years old, built and designed for a different clientele. So, for those coming off the sidelines from a capital perspective, whether on the debt or equity side, they have two options: pursue new developments or acquire an existing community that’s either stabilized or underperforming.

The feedback we’ve received indicates that most people are leaning toward acquisitions. Whether it’s because they see more creativity or opportunity in that route is a good question. However, with fewer players having a strong development pipeline like ours—since we’ve remained committed to developing new projects—I believe that’s why many are focusing on acquisitions.

There’s risk in everything you do in this business, but we trust what consumers are telling us about the future of senior housing. That’s more appealing to us than trying to turn around a struggling project.

On factors it will take to pencil out development in senior living next year and beyond:

I hope it gets a bit easier, but maybe it’s not so much about creativity as it is about trust. Some of our projects involve two, three or even four banks on the debt side, which requires a lot of coordination to get everyone to agree on terms and loan documents. It takes creativity to make that many stakeholders work together, especially when we also have several partners on the equity side.

It’s been challenging, but our track record has helped us raise outside capital, which not every group has done successfully. Those who have raised external capital tend to look at developments differently, as their return expectations and trust levels are often distinct.

I do hope it becomes easier for everyone because, ultimately, we all need to push this industry forward. There’s a significant need for growth to keep up with demand, especially as customer needs and preferences evolve. It’s definitely stressful, but it’s also rewarding to be creative in structuring a capital stack these days. It’s like solving a Rubik’s Cube, but it’s something we genuinely enjoy tackling.

On market selection for new development in 2025:

It’s a bit of our secret sauce, so I’ll give you a high-level overview. We have an in-house data analytics team, and that’s their sole focus. They’re all much smarter than me, thankfully, and they crunch the numbers on what’s working. We have a spreadsheet with around 45 different metrics for every market we’re evaluating. To put it in perspective, they’ve analyzed over 1,100 deals, but we’ve only broken ground on 16. So, they’re more inclined to pass on opportunities than to move forward. It all starts with that data analytics team.

We also have an in-house Vice President of Market Intelligence who spends a lot of time in these markets, not just looking at occupancy rates and pricing, but also understanding the local market dynamics, what competitors are doing, and what’s working or not. This research influences many of our decisions, from unit mix to fit and finish.

For us, being in tune with our consumers and customers is crucial. We conduct surveys and gather feedback from our residents and their families, but most importantly, we’re present. I’m on the road nearly every week visiting our communities, speaking directly with residents to understand what they like, what’s working, what’s not, and whether they find value in what they’re paying for. If they don’t, we want to know why. If they do, we want to understand that as well.

We’ve built a lot of trust with our residents, their families, and team members over the years, and we’re intentional about seeking and using their feedback. There’s no ego involved—we genuinely want to improve. Our goal is to continue evolving this industry, enhancing both the existing communities our residents live in and the new ones we’re developing for the future.

On balancing risk in new senior living development:

It’s more tap dancing than walking, but there is a fine line between risk and reward. For us, we believe in the data and demographics, and we have an incredible investment committee and founders who are committed to growing and changing this business. We don’t ignore the capital markets, and while expectations have changed, we remain convicted in doing the right thing and creating better outcomes for our residents, families, and team members.

NextCore Group, our parent company, is one of the largest healthcare developers in the United States. We’re seeing the need for new healthcare options in better locations across all fronts, not just in senior housing but also in our medical outpatient and life science businesses. This is what drives us: a commitment to improving outcomes for our residents and partners in healthcare.

While we may be ahead of some competitors in this approach, I believe there is still plenty of room in the market for everyone. If we’re the group pushing things forward, some might look at us and ask, “Will this work?” Maybe it won’t, but I’m committed because we understand the feedback from residents and what the market needs. Our success over the past couple of years backs this up. Many of the buildings we’ve opened have been fully occupied and cash-flowing within 12 months or less. In fact, our fastest-growing building, which opened last year, reached 100% occupancy within six months and started cash-flowing even faster.

As for the pipeline, when we talk about the needs of our residents, there’s always a social need that’s just as important as the physical one. People don’t typically wake up on a Tuesday morning and decide, “I want to research senior living and move in today.” It’s often a social need—people want to be around others who share similar experiences. I think Covid brought this to light, with many people realizing they don’t want to go through something like that alone again. Living in a senior community now looks much more appealing than living at home, whether with a spouse or alone.

People are making that decision earlier, and we’re designing communities with various social spaces, not just one activity room or a dated dining room. Every space is intentionally designed to foster human connection and create more purpose in life. Our residents want larger apartments, but they spend less and less time in them.

On executing the first year of lease-up in a newly-developed community:

I’ve been preaching for the last 20 years of my career in development that how you start a community is exactly how it will be maintained throughout. Recently, I had the opportunity to return to a community I opened over 20 years ago, which had since been taken over by a different management team. When I walked into the building, some of the people who were there 20 years ago remembered me and were still part of the community. The culture we established in that first year was still in place, which was really cool to see.

I believe it all starts with people. That’s what it’s all about. We like to pre-lease as aggressively and as early as possible, which is different from the industry standard. This approach has been an educational process for some of our capital partners, who have had to adjust to the idea that we don’t just open a sales trailer three months before a building opens and hope things work out. That’s the old model for senior living development, and it’s not ours, especially for larger communities. You need to create the community before the building is even built. The community of people is key.

We start by hiring our executive director and director of sales as early as possible. We build out a leasing center and show people what the real estate will look like, even though this isn’t strictly a real estate decision. We make it a priority to hire the best executive director and director of sales we can, aligning incentives with ours to ensure the building is full within the first 12 months. This is why we’ve had the success we’ve had—it’s not about me or the marketing team. It’s about hiring the right people, aligning incentives, and empowering them to understand the market and envision what the community will look like.

Our design is world-class, and people often say, “Wow, this looks amazing,” but the real question is, “Who will I connect with? How do I get over the fear that this won’t feel like the first day of kindergarten all over again?” You can only overcome that by truly creating the community before the building is built.

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