With more senior citizens opting to move out and stay in their own private space, the senior living real estate is emerging as one of the prominent alternative asset classes for real estate players, say stakeholders.
Interestingly, south India accounts for 70% of the senior living projects in India. Tamil Nadu has emerged as one of the prominent markets for senior living real estate, according to details provided by real estate company Jones Lang LaSalle (JLL).
Studies show that by 2050, nearly one-fifth of the population in India will be 60 years and above, hence the senior living segment has immense development potential
Over the next few years, the demand for senior living proj ects will increase manifold in Chennai and tier II cities, pro- viding a stable market for those investing in these properties
The elderly population, typically defined as individuals aged 60 and above, accounted for a significant portion of Tamil Nadu’s population
As per the 2011 Census data, Tamil Nadu had around 82 lakh (8.2 million) senior citizens, approximately 11.4% of the State’s total population
As per industry reports, southern cities in India are home to almost 70% of senior living projects in the country
Chennai, Coimbatore, Kodaikanal, Kancheepuram, Bengaluru, Mysuru, Kochi and Puducherry are among the prominent senior living hubs in south India
Apartments and villas cost from around 30 lakh to 1 crore or more depending on the location and amenities offered
In Tamil Nadu, apart from Chennai, other towns are slowly opening up to this segment. And more real estate players are eyeing this space. Those tracking the real estate market say companies like Ashiana Housing and Columbia Pacific Communities are betting big in this space.
“Apart from Chennai, Tier II & III locations such as Coimbatore, Hosur, Kancheepuram [in Tamil Nadu] and Puducherry have emerged as the markets for senior living projects. Hill stations like Udhagamandalam and Kodaikanal have also emerged as a niche market for senior living,” says Jerry Kingsley, head, Strategic Consulting and Valuation Advisory, India, and City Lead Capital Markets-Chennai, JLL.
Srinivas Anikipatti, senior director, Tamil Nadu and Kerala, Knight Frank India, points out that the future of the senior living segment in Tamil Nadu looks promising. “First, there is a significant demographic shift in Tamil Nadu, with a rising elderly population. This demographic group seeks specialised housing and services tailored to their needs. Secondly, the demand for senior living facilities is driven by changing lifestyles and the desire for an active and socially engaging retirement. Real estate developers see this as a lucrative opportunity to cater to the specific requirements of this segment.”
“Real estate players are expected to further expand their presence in this market, offering a wider range of options to cater to different needs and preferences,” says Mr. Anikipatti, adding that with evolving lifestyles and changing expectations, senior living projects that provide comprehensive services, promote active ageing, and prioritise residents’ well-being are likely to thrive.
Columbia Pacific Communities has 10 senior living communities in India and most of the projects are in south India. Its CEO Mohit Nirula says, “Tamil Nadu leads in this segment in India and seven [4 in Coimbatore, 2 in Chennai and 1 in Kancheepuram] of our projects are present there. We have recently announced a new senior living project in Chennai, which would be a joint venture with TVS Housing,” he said.
R. Karthik Narayan, managing director, Athulya Assisted Living Pvt. Ltd., mentions that he has observed a significant increase in the demand for senior living projects in Tamil Nadu over the last 10 years. “There are several factors contributing to this growth, including changing social dynamics, improved healthcare systems, and the impact of the COVID-19 pandemic. In fact, admissions at Athulya facilities in Chennai have risen by almost 50% since the beginning of the pandemic,” he says. Also, according to the Ministry of Statistics and Programme Implementation, Tamil Nadu has the second highest number of senior citizens in the country, he notes.
Mr. Kingsley says the senior living segment offers various financial models for the developer and the users like outright sale, lease deposit and pure lease. However, in south India, users prefer outright sale more. Real estate developers say the budget size of the project will depend on various factors such as location, availability of healthcare and support infrastructure. It is learnt that people who are buying such properties are aged 52 and above, and many of them are buying it without taking loans.