What Retirement Villages will need to stay up to date with the current generation
Developers in the Retirement Village industry need to up their game: the next generation of retirees won’t be impressed with a sad colour scheme and tasteless food at the canteen. Grandma has been replaced by Glam-ma and she needs a good internet connection to FaceTime with her grandkids.
‘I believe in the generational theory. At present we are dealing with three generations. The so–called Silent Generation who live in our retirement villages, the Baby Boomers some of whom are in their 70’s and considering retirement villages and their adult children Generation X, who advise mom and dad on retirement decisions,’ says Arthur Case, Brand Marketing Director at Evergreen Lifestyle.
‘Developers need to understand the difference between these generations and be able to communicate with all three. The Boomers, in particular, are looking for a different value proposition to their parents. Competition is on the increase in South Africa, the old age and nursing homes of the past will face financial challenges and eventually be phased out as is presently happening in the USA. These homes will in time need to be repurposed or demolished as they will not attract new investment.’
Until now, developers have enjoyed a market of massive undersupply. Retirees have been only too happy to find a roof over their heads. However, small villages are struggling and some have even closed down. Then the likes of companies like Evergreen, Shire Retirement Properties and Oasis are embracing the demands from a growing black middle class and a generation of buyers looking for an extension of an already active and engaging lifestyle.
‘Future retirement village developers will need to develop sustainable villages to reduce costs and mitigate the risk of Eskom blackouts and Day Zero eventualities. They’ll also need to have strong balance sheets to weather the ups and downs of the economy, develop sufficient scale (300 – 800 units) to keep purchase prices and levies affordable and offer continuous care facilities so that purchasers don’t need to relocate late in life,’ says Case.
According to Case, the following will also be expected of Retirement Villages:
- To be equipped to offer care with dignity for seniors who develop dementia
- To offer smart technology like fibre-to-home, telemedicine and high–tech security
- To understand that this is both a people and property business, but that people come first
Currently, developers are noticing that the new crop of retirees expect more and want a say in their day to day experience. For example, they demand detailed billing, options for everything and highly flexible services, a single point of interaction for services, cashless transacting within the estate and rules that facilitate the lifestyle and not rules that treat people like children.
‘Part of the reason that developers are not up to date with the important trends is that there is no single place to go for advice or statistics. Government stats are a mess and there is very little cooperation or organised sharing of information in the industry despite many attempts to organise. Events like the Retirement Village Summit at the end of May are vital to the communication process,’ says Rob Jones, founder of Shire Retirement Properties.
‘There is a strong reliance on estate agents for some information, but this often comes at the selling point, which is often too late anyway. Other sources are Architects and Engineering Consultants. Retirement village living consultants like myself are few and far between, and many developers do not recognise the value we add until too late. Retirement Villages are all about service in the long run, and few developers understand services or how to build infrastructure to facilitate service delivery, says Jones.
According to Jones, a critical factor is setting the price points of both the property and the levies in such a way that there is stability in the levies over the long-term. ‘There are many aspects to this planning that go totally ignored in many developments – and the residents sometimes pay the price.’