CBRE have released their 2024 Seniors Living Report which covers both the countries Aged Care and Retirement Village markets. There are multiple key takeaways from the report in what is the most impactful in the companies history (having released these reports since 2021).

CBRE summarise key takeaways from the report in into 2-3 key components.

1. Increased interest from international investor and owner occupier profiles

2. Undersupply of RACF Beds and ILU’s

3. An industry on the improve with green shots across all occupancy fronts

Marcello Caspani-Muto said “The undersupply of Aged Care beds and Retirement homes is nothing new, our business has been preaching this since 2022. It’s time people stop looking at all the negative press associated with the sector and focus on results. The shortfall in supply in the coming 5+ years is astounding, we are already set for a crisis. If funding is not improved to incentives increase levels of new aged care development from operators, many people will struggle finding a quality care home for their family members.

With the exception of 2-3 providers, almost no aged care operators have a new development pipeline. Those with sites have paused projects. With construction costs at circa $400k per bed for a new build it’s easy to understand why. These are multi-year developments, so we are already 3-5 years behind the required supply rate. Looking into retirement villages, we are set for a supply shortfall of circa 79,000 independent living units by 2025……”

Jimmy Tat added “The main source of capital willing to develop in the space is coming from Asian markets. However, their lack of operational knowledge means many are seeking JV arrangements with local RACF or RV operators. Given the notable barriers to the RV sector it still remains a challenge to find providers willing to collaborate in such a nature.

On the flip side of the equation the team have seen a notable increase in the transaction of vacant aged care homes. International capital is very bullish on the space, particularly when the team can source them alternative tenants during the course of the campaign. These are typical healthcare or NDIS related users.”

To request a copy of the CBRE 2024 Seniors Living Report please contact one the CBRE agents below. 

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