Tag Archives: Senior Housing in India

Senior housing USP of Bhiwadi

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News Point: Bhiwadi has carved its niche as the best market for senior housing.

Senior Housing in India, Elderly Living, Homes for senior citizens, Real estate news India, India property market, Track2RealtyWhen Ramakanth Sharma bought an apartment in a senior housing project in Bhiwadi it was more to do with the affordability than the concept of senior housing. As a matter of fact, the friends and family advised against buying an apartment with such a concept that gave an impression that their children would refuse to take care of them in future. Sharma himself had no plans to settle over there and it was just an investment that his pocket allowed.

Between 2007 to 2004, the developer on his part continued to invite him on various community engagement programmes at the project. Even though there were initially only a few senior citizens shifting prmanently, he really liked the idea of seniors having a get together. And hence, when his son took up a job in the USA, he decided to pack his bags and move to Bhiwadi’s senior housing project.

It has nevertheless not been an easy move since his wife carried the impression of living in an old age centres. However, soon the couple understood the advantages of the senior citizens having the luxury of living a dignified life in their own homes, with a neighbourhood of the same age group and with all the necessary facilities like the healthcare etc available on the door steps.

Bhiwadi, as a matter of fact, has been the first town to conceptualise what is the most need-based housing in India. Facts speak for themselves. There are 98 million people over 55 with a steady growth of 3.5 per cent per annum. In terms of market numbers, in an analysis of 135 urban cities with a total population of 223 million and 52 million households, as many as 12.8 million families have senior citizens.

Bhiwadi facts

Bhiwadi first mover in senior housing segment of India

Affordable senior housing & quality lifestyle catalysts to success

Bhiwadi experiment was globally discussed for providing lifestyle to senior citizens

Bhiwadi success dispelled the myth of senior housing being old age homes

The old age dependency ratio stands at 12.6 from 10.6 in 1991. According to the United Nations data, India would have 118 million people over the age of 60 years by 2017.  The market size of retirement homes is expected to be pegged at Rs 4,000 crore by 2018.

Some of the developers in Bhiwadi could spot this opportunity and made it a case study in India. Thereafter a number of developers experimented senior housing in various parts of the country. However, only a few locations like Bhiwadi, Coimbatore, Pune could be case studies due to proximity with the main centre and better climatic conditions, along with the execution of the project in right spirit.

Brotin Banerjee, MD and CEO of Tata Housing nevertheless feels that the concept of senior living is slowly gaining traction, but unlike in the West it will take a bit longer for this market to mature here. However, with the breakdown of the traditional concept of families, and with an increase in disposable incomes, this senior community is gradually inclining towards this idea and accepting it without any social stigma attached to it. Today’s globe-trotting consumer is demanding for an active lifestyle post retirement.

“Buyers for senior living homes are self-sustained retired/about-to-retire people (or in the age group of 50 and above), those whose children reside away from them or outside India, senior NRIs accustomed to such facilities in developed countries and now returning to their home country. Research suggests that demand for such senior homes is over three lakh units in urban centres and currently, only 3,000 units are available in the market,” says Banerjee.

One fundamental reason why senior housing succeeded in Bhiwadi is the price point. The fact remains that all the senior living projects in Bhiwadi are positioned at the affordable segment, bearing in mind the fact that the end consumers are senior citizens with limited resources and no sources of regular income.

As Ramakant Sharma points out, “If such projects would be costly, most of the retired seniors would not be able to afford. I think the way Bhiwadi shaped up as an affordable market and the developers had been foresighted to spot the living solutions for people like us, it became a success story.”

Call it the emerging lucrative market or simply making a market differentiator  by providing house for a cause, but senior living has definitely been the market identity for Bhiwadi. And Bhiwadi model is today being replicated across the country. The data by Jones Lang LaSalle India indicates there are about 30 more senior living projects in the pipeline in India. Of the senior housing projects, seven are in Bangalore, three in Chennai, three in Goa and various single projects in other cities.

The senior living sector in India

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Senior Housing in India, Elderly Living, Homes for senior citizens, Real estate news India, India property market, Track2RealtyThe senior living sector in India is at a crossroad.

With the relaxation of Foreign Direct Investment (FDI) restrictions on investments in the sector and increasing population of seniors (over 100 million seniors in India at present) to cater to, there clearly exists an untapped opportunity for investment and development in this sector.

Unlike western countries where the senior living industry has gained maturity, India provides an opportunity to developers, service providers, healthcare players and operators to create solutions specific to India while leveraging learning from across the world.

In the white paper ‘Senior Living Sector In India’, JLL India showcases seniors in India as a demographic segment, brings out key trends in senior housing in India, assesses overall market potential, focuses on best practices, and brings out a pan-India preview of senior living projects in India.

The emerging need for senior housing in India – staying ahead of the curve

Although India is still younger than USA and Japan from a demographic standpoint, the process of ageing has begun in the country. It is anticipated that the elders in India would increase both in absolute numbers and relative strength, indicating a gradual swing to a senior population.

As per Census of India projections, the percentage of elders as a percentage of total population in the country would jump from 7.4% in 2001 to 12.4% in 2026 and touch 19.7% in 2050.

In 2011, India had about 76 million seniors above the age of 60 years, and it is expected that this figure will grow to 173 million by 2025, further increasing to about 240 million by 2050.

This marked increase in elderly population would involve a change in an important sociological aspect, the ‘old age dependency ratio’. Interestingly, by 2050, it is estimated that the number of dependent adults in India will be at par with the number of dependent children. The population pyramid shows that the movement of the bulge in the population northwards to higher age cohorts with time.

Besides growth in sheer numbers, seniors are also evolving as a customer segment and have needs and wants, which are different from seniors in earlier times. A significant section of seniors today are independent, financially stable, well-travelled, socially connected, and as a result have well developed thoughts of how they want to spend time after retirement. There is, today, a larger percentage of educated seniors than ever before in India.

Seniors now consider life after retirement as an opportunity to spend more time with families, pursue hobbies, develop new interests or even continue working or starting a new career.

While it is true that the seniors are more independent and better equipped to take decisions post their retirement, it is equally correct to say that their needs are not rightly understood and therefore not met appropriately by both public and private sector at large. The senior community presents a tremendous opportunity to service providers.

Senior housing segment in a global context

As per the findings by National Family Health Survey in 2005-06 (NFHS-3), every three out of five households (about 63%) in India are nuclear. Increasing life expectancy, decreasing fertility rate, lower mortality rates and an overall enhancement of the standard of living across the world has contributed to people living longer than ever before.

In 2008 as per the National Institute of Aging (USA), it was estimated that the senior population (above 60 years of age) in the world was 506 million. The population of seniors across the world is projected to become 1.3 billion by 2040.

This increase in population in the segment will bring with it unique socio–demographic situations which have not been experienced by society at large. For the first time in human history in 2021, the total number of seniors will be greater than the number of kids below 5 years of age.

While developed nations will still have a large number of seniors, the rate of growth in senior population in developing nations will be double that of developed nations. The 80+ age segment is actually the fastest growing segment amongst population cohorts in several nations.

China and India are projected to have almost 50% of the 1.3 billion worldwide seniors by 2040. Seniors need specialized housing catering to their needs. What started in early 19th century in the USA to cater to housing for seniors mainly through the interventions of religious groups and charitable bodies is now recognized in the USA as a prominent asset class.

Senior housing is a USD 60 billion industry worldwide. In USA alone there are over 520,000 senior housing units with additional 16,000 units under construction.

While the sector commands large numbers, it is also important to get a sense that only about 12% of seniors in the USA live in formal senior living projects. Compare to this Australia has 4% as seniors living in such projects.

In contrast to senior living in the west, the concept of housing for seniors as a specific asset class in India continues to have social stigma associated with it which has restricted the growth of the sector at large.

There is, however, now a growing realization amongst urban households, who in the last 20 – 25 years have witnessed a marked increase in nuclear families that families are no longer equipped to take care of their aged family members.

In this changing social environment, concepts such contemporary retirement resorts are becoming acceptable and popular. While this has prompted developers to come up with projects targeting the independent seniors, the country is yet to see an integrated continuing care retirement communities catering to end to end needs of senior citizens.

By: Manish Kumar, Managing Director – Strategic Consulting, JLL India