Estate Living Magazine Estate Living Issue 29 May | Page 51

Retirement living investments – a robust alternative
Calculating investors have discovered that luxury retirement
property developments provides the strongest investment
case. The residents are affluent, which means that they
are self-paying and not government supported,thereby
reducing political risk and cutbacks.
Each high-quality apartment is furnished with a typical
rental of R20 945 per week. That includes hotel style
services such as meal preparation, housekeeping,
laundry room service. In addition to organizing social
activities, offerings include help getting out and
about, shopping, administering medication, personal
hygiene, on-site award-winning chef, hair and beauty
salons. Most residents say that it is the companionship
and sense of community that attracts them to retirement
communities.
As the residents do not usually have complex medical needs,
there is no statutory requirement to have minimum level nurses
onsite, thereby reducing operational risk and the cost of a
potential shortage of nurses.
In 2017, Legal & General acquired a UK operator with R670m
of retirement property portfolio. Their chief executive, Nigel
Wilson said “Creating around 3,000 new, quality homes over
the next five years, our aim is to become a leading later living
managed. As busy members of society, readers of Estate Living
can appreciate the value in having the property leased and
managed by an operator.
In the UK, commercial property under R2.5 million is exempt
from stamp duty (land tax) at acquisition. Recent tax changes
on income on UK residential properties will not apply to care
homes or retirement home investments.
In conclusion, retirement homes do not seem to be under the
same pressures that care homes are currently facing in terms of
nursing staff shortages, increases in the minimum wage or lack
of funding from the local government. They provide a service
not specifically for those with complex medical needs, but for
housing operator”. those either looking to release equity from their property, or
The retirement home asset class is one of the most undersupplied (or both).
in the housing market and according to estimates, 3.3 million
people in the UK wish to downsize, but only 7,000 specialised
homes were built to accommodate later living requirements.
Retirement property developments are generally located in the
warmest part of the UK, such as the Isle of Wight and Devon.
Almost 24% of the population is of retirement age in these
South Western counties. Aside from the existing residents,
those in their later years willfully exchange the hustle and bustle
of city living for the tranquility of the countryside, where they
can enjoy leisurely walks along the beach and stumble across
village boutique shops and quaint cafes.
Retirement home investments – the fundamentals
Retirement home investments typically offer an annual return
of 10% over a ten-year commercial lease. As the suite or
apartment is leased back to the developer and an experienced
operator installed, it is completely hands-off for the investor.
Owning a rental property can be time consuming if self-
who just wish to spend time with other like-minded individuals
The increase in popularity of retirement living in the UK and
the UK’s ageing population, coupled with the shortage
of appropriate retirement living suites, provides an ideal
investment environment. Large corporations are recognising
the gap in the market for retirement home investment and have
begun investing millions into the sector.
Opportunities tailored towards the individual investor and
offered by One Touch Property often sell out within a few days.
If listed property funds and private investors are recognising
the benefit of UK retirement home investing both socially and
financially, could it pique your interest?
Download the free guide: www.onetouchinvestment.co.uk/
care-home-investments/
Contact: 010 300 1200