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  • Senior Citizen Homes Alternative Trends in India’s Realty Market

    Published on April 15, 2014

    India is currently witnessing a demographic shift, owing to a steady increase in life expectancy on the back of improved healthcare access. Amid the rise of nuclear families in India, the country’s 60-plus population is currently estimated to be around 100 million, with expectations of touching326 Anshuman Magazine_1million which will constitute 20% of India’s total population by 2050 (source: UN data projections). Consider the fact that our much touted “demographicdividend”, our urban youth population, will reach a median age of about 29 years in less than a decade (source: UN-HABITAT), making us one of the youngest nations globally. Such benefits, however, come with their own realities—and in a couple of more decadeswe would have an equally large aging population. In addition, there has also been an aspirational change in the mind-set of senior citizens in general, with an increasing desire for leading a secure, independent and productive life after retirement spentin the company of like-minded peers,who echo common interests and aspirations in their silver years. Enough ingredients for retirement/senior citizen homes to be recognized as a sunrise segment by India’s realty market.

    Over the years, this transformation has been gradually translating into an opportunity for real estate developers to provide residential products customized to the specific needs of the elderly in India. What this demographic group needs over and above financial and emotional security is healthcare facilities, geriatric care and security services. Such assisted living/retirement home projects are especially sought by elderly couples seeking a better lifestyle with accessibility to healthcare; elderly non-resident Indians (NRIs) desiring to return to India on either a long-term or a short-term basis; and the elderly without any family support. Other unique requirements of a senior living project include an apt social environment anda peaceful location that is preferably on the peripheries of a leading city—close enough to major healthcare facilities yet far enough from the hustle of city life.

    Factors &Sites Suitable for Senior Living Facilities:

    •             Healthcare accessibility                •             Connectivity

    •             Affordable land value                    •             Civic amenities and infrastructure

    •             Lower density of population       •             Safety & secured locality

     

    Senior housing in India is usually available in large-scale formats of 10–60 acres, mid-scale formats of 4–10 acres, and 1–4 acre small-scale projects; while financial models are available in sale, lease as well as rental models. Typically suchhousing units vary from 50–100 units in a project to a maximum of 400 units within a single project; and most of these are in the 1–2 BHKformats, with unit sizes ranging between 500 sq.ft.and 1,000 sq.ft.at an affordable pricing rangeofINR 10–30 lakh. The key challenges for developers launching senior citizen housing projects in the country are mainly the affordability factor and the lack of trained manpower sensitive to and capable of handling such projects.

    Success Model for Senior Citizen Homes:

    •             Healthcare partner          •             Good branding & strong professional management

    •             Location                               •             Good understanding & knowledge of senior citizen needs

    •             Variance model and pricing         •             Innovative designs & project layout

    •             Marketing strategy         •             Experienced architects and consultants suitable for senior citizen homes

    •             Concierge services          •             Relevant amenities & product mix

    •             Green and open spaces                •             Regular shuttle services

     

    Developers already working in the Senior Citizen housing sphere in the country includeCovaiProperties, Ashiana Group of Builders, Brindavan Senior Citizen, Senior Citizen Foundation and Classic Promoters, among others. Realizing the potential that the segment has to offer, leading developers such as Tata Housing have also ventured into this space, with two of its senior living projects already under construction in Bangalore and five more in the pipeline in the same city. Tata Housing also has three upcoming projects in Chennai. Going forward, more developers are likely to realize the potential of this segment and a subsequent increase in the number of launches of such projects is expected as the segment matures across the country.

    There exists a vast untapped potential in India for alternative asset classes, such as senior housing projects. Significant investment from private developers is expected in such segments, as they look towards expanding their footprint beyond conventional real estate asset classes. While such new formats might see a comparatively slower pace of expansion vis-à-vis other formats such as Tech Parks and Logistics Parks, the growth of this sunrise segment is imminent in the long-term, given a sustained demand for the same from a large aging population in decades to come.

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