Stellar Senior Living Launches $25m Equity, Jv Investment Effort 

Stellar Senior Living is launching a $25 million equity and new joint venture investment structure to help spur future growth in new ways, according to Stellar Co-Founder Adam Benton.

The company is seeking to garner the $25 million from a variety of sources, including individual investors and friends and family offices. The equity raise is structured as a joint venture, investing alongside private stakeholders akin to a family office-structured investment pipeline, Benton said.

“We just want to be prepared to be able to invest alongside our partners as the opportunities come up, and not be stuck in a cash crunch,” Benton told Senior Housing News.

With its move, Stellar joins a handful of operators that have sought similar approaches to grow. Baltimore-based Brightview Senior Living earlier this year announced a new, $200 million fund raise, its ninth in total. Fort Wayne, Indiana-based Priority Life Care also announced a $10 million fund for co-investment with similar aims.

Typically, Stellar has invested in two to three deals annually until the recent equity raise, but the new effort will allow Stellar to participate in “every single deal” to make outsized investments in future acquisitions or development.

With future investments, Stellar seeks to put capital into deals or new development in a general partner or limited partner structure, while incentivizing family office investment to reap upside potential on future senior living transactions or development.

“We realized there’s going to be more opportunities than we have capital and that’s new for us so we decided to go do this raise,” Benton said.

What future investment could look like includes a “little bit” of new development and a “majority” of acquisitions, taking over distressed senior living assets, turning those around and selling to private equity groups, Benton added.

“So that’s probably the majority of what we’ll be targeting at this point, but there is this piece of new development that we will have some target on, probably less than 25% of the entire portfolio,” Benton said.

Just as to when new development might happen, Benton sees opportunities for new projects towards the end of the equity raise’s timeline, in 12 to 24 months. But to execute on distressed transactions, Benton said Stellar’s track record of building strong frontline community teams and regrowing occupancy would pair well in future distress-driven acquisitions.

“We think that that strategy works if it is in any stage of the real estate cycle, but if you apply that strategy on top of a phase one recovery real estate cycle,” Benton said. “It’s the best time that I’ve ever seen in the industry for investing.”

In 2024, Stellar expanded to Texas, acquiring four new properties in the Lonestar State with acquisitions in the Dallas, Austin and Houston metro areas. Future investments could come in the form of 100 units or greater with a value-add component across the independent living, assisted living, memory care sectors.

Currently, Stellar has a footprint in western states including Arizona, Colorado, Idaho, New Mexico, Texas, Utah, Washington and Wyoming with over 36 communities with the goal of serving 10,000 seniors by 2030. The company also has three communities under development presently and is over halfway to reaching its 10,000 residents-served goal, Benton noted.

But while considering growth, Benton said Stellar’s main constraint to new growth would continue to be “maintaining quality” so as to not grow too quickly and dilute the quality of care provided to residents at Stellar communities. To get to that overarching goal, Benton sees a world in which Stellar’s portfolio of communities could grow to between 50 and 60 properties.

“At that size you have enough revenue that you can field an entire team that can cover key areas of operations and you still can connect personally with teams and know everyone’s name,” Benton said of the company’s future size.

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