New Zealand has seen a growth in retirement villages in recent years. The population of people in the 65 plus age group doubled between 1980 and 2013 and is likely to double again by 2036. Retirement villages are an important element of housing and supporting the aging population.
At the current penetration rates, 69,000 retirees will live in a retirement village by 2036 and if rates rise as they’re expected, that number could be as high as 83,000. This rising population of retirees is introducing some interesting and attractive business opportunities for Kiwi business owners.
Services for Retirees
One thing about retirement villages is certain — the paperwork is not easy to navigate. Residents do not have an interest in the land; rather, they purchase a right to occupy their home. Opportunities abound in helping retirees and their families find the right facility and ensure their financial and legal rights are protected.
Residents sign an Occupation Right Agreement (ORA) and the Retirement Villages Act 2003 provides that intending residents receive independent legal advice. Lawyers will ensure that the retiree is protected in case of bankruptcy of the village, natural disaster or facilities not being as expected. Lawyers may find a growing market in this legal work.
Services for Villages
There are several services that the enterprising business person can provide to retirement villages and build a business around. For businesses providing cleaning services, retirement villages offer a large, new client base. Cleaning services are often offered to residents so they don’t need to clean their apartments. There are also large communal areas used by all residents that require regular cleaning.
Some retirement villages may hire catering staff to work on the premises, but it’s possible that company-owned retirement villages may prefer to outsource this so they don’t need to look after a large number of staff. If you choose to investigate this sort of contract, just be sure that it isn’t your sole contract, in case the agreement with one retirement village ends.
Finally, the best retirement villages offer regular activities for their residents. If you have skills in exercise or dance classes, meditation, massage or other activities, you may find retirement villages are willing to pay for you to lead those activities for residents. Some services such as hair-dressing or grocery delivery are also appreciated by residents and may offer a growing business to a creative entrepreneur.
Retirement Village
Finally, there is the option of opening a retirement village. This is where the numbers make the most direct impact. From 2008 to 2017, the number of people over 75 in retirement homes rose by over 33 percent.
Where other business propositions in this article can be started very cheaply, a retirement village requires a significant amount of capital. A retirement village requires land, capital for building costs and sales people to sell apartments off the plan. There’s a reason why the big businesses in the industry are worth $9 billion on the NZ stock exchange.
If you are looking to open a retirement village, consider things such as builders and contractors. There’s already a high demand for those with these skills, and not being able to find workers is a definite risk. Refurbishing an existing facility could be a cheaper and safer option. Remember that residents are interested in retiring to a facility that offers them community and activities all in one place, as well as a continuity of care. In other words, they want options to be able to move to higher care without leaving the community. Villages that also offer dementia facilities and high-care facilities are generally preferred by prospective residents.
No matter which numbers you look at, the prospects look bright for retirement villages. The industry is predicting continued growth as retirees look for new housing options. This growth brings new opportunities for business owners and entrepreneurs who are willing to grab them.
