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How Headwaters Group is Pushing Ahead on Active Adult, Learning from Greystar to Build Strong Brand

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The Headwaters Group is forging ahead with its active adult strategy in 2024, emerging as a growing player in an increasingly competitive sector.

“2024 is the year of building,” Headwaters’ Managing Partner Ben Burke said. “We are going to be breaking ground on four communities, and [are] finalizing our brand and getting really to begin pre-leasing, while also growing our pipeline for the years ahead.”

As it stands currently, Headwaters has one active adult project under construction in Centennial, Colorado along with three development sites in Colorado and another in Arizona set to break ground between now and the end of the third quarter, according to Burke. Even further down the pipeline, the company has four sites under contract in those western states.

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Last year was a busy one for Headwaters, having formalized a partnership with real estate behemoth Greystar for management at two active adult communities, while also taking on new acquisitions. All of the Headwaters active adult communities are positioned under the brand name Aspendale.

Headwaters entered into a joint venture general partnership (GP) with Los Angeles-based Orion Real Estate Partners for a community in Salt Lake City, Utah, with the company continuing to look for acquisition opportunities that are attractive, Burke said.

“When it’s all said and done, knock on wood, we will probably have four deals under construction by the end of the year and around the same number in 2025 and sprinkle in acquisitions opportunistically,” Burke told SHN in a recent interview. “We want to buy something that is proven it can lease up and get to a certain occupancy that has upside in revenue.”

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The Greystar partnership has helped the Headwaters team learn how larger firms manage, market and invest, from design and marketing conversations to the nuts and bolts of dealmaking in underwriting, Burke said. Greystar had more than $74 billion in total gross assets under management in 2023, and its active adult arm made it the ninth-largest owner of senior housing in the United States last year, according to rankings from the American Seniors Housing Association (ASHA). Greystar anticipates “explosive growth” in active adult, Michael Levine, senior managing director of real estate, active adult, told SHN in August 2023.

In crafting the Aspendale brand, Burke said the process is one of the many reasons the company partnered with Greystar.

“Our brand is everything,” Burke said. “Greystar has bought into how important the brand is and they also know how to have a variety of brands. They know how to jump in and out of each brand and help drive the brand at each community. The fact that they can be nimble is a huge value and they’ve helped guide our brand based on challenges and successes they’ve had in the past.”

The Aspendale Centennial will be a four-story, wood frame apartment building covering over 203,000 square-feet and include over 170 units for residents 60 and older. Amenities at the community will include a fitness center, garden, lap pool, spa and more. The project’s general contractor is Crossland Construction with architecture services provided by Santulan Architecture, according to an article published in Mile High CRE.

Even with the busy pace at hand, Burke said Headwaters leadership was thinking about its future development and acquisition pipeline because it takes “nearly two years” from a project’s inception to closing at a development site.

With an undersupply of middle-market senior living units, Burke said development was the logical course forward to meet rising demand, a common refrain among those still aggressive in development despite a still-tough interest rate environment.

Sticking currently to western states for development, Burke said it is important for Headwaters to know its market share while understanding an area’s demographics and any barriers that could deter prospects choosing an active adult move.

“We feel very confident in investing in our own backyard,” Burke added. “We’re starting with Colorado and roughly the neighboring states and we will expand west of the Mississippi [River] from there.”

While most of its communities don’t integrate a health care component, Burke said he envisions an “upper middle-market” demand for both care integration and social models like Headwaters’ to thrive in the coming years based on local market factors that can change depending on the operator. 

Going forward, Burke sees the company refining its active adult product to meet customer needs and build brand awareness, while continuing to develop new communities over time.

“If we can really refine our product to make it have the highest appeal to our target customers, we really think we can improve the lives of folks and not be burdened with the challenges and expenses of homeownership,” Burke said.

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