The retirement living model with integrated care could provide major savings government savings of up “£3,500 per annum, per person” according to Andy Feculak, Development Director at McCarthy and Stone.

The sector however is largely still fledgling, compared to countries such as Australia and the USA where the model is more developed.

Speaking at our recent Healthcare Property and Development Conference, Feculak said: “We believe there is a housing crisis for the elderly, policy should really support doing 30,000 homes per annum and we’re doing a fraction of that.” [emaillocker id=”71749″]

Feculak proposed that the government form a housing policy specifically to tackle the housing needs associated with an ageing population.

The retirement living model is very popular with residents, Feculak claimed: “9/10 people say that we improve the quality of their life.”

In addition, it provides a solution to the problem of social isolation in older people. Feculak further cited research that said “83% of people who live in our buildings and communities say they experience a greater amount of community.”

Audley Group is another major developer of retirement living schemes and are expanding rapidly. Managing Director of Development Kevin Shaw said: “We have 20 retirement villages throughout the UK, but we have many more in the pipeline and we’ll 23 retirement villages in a few months’ time.”

Initially schemes such as these were primarily for purchase, but there has been an increasing move by developers towards a rental model, Feculak said: “We’ve just launched a rental model, it’s taken some years for us to do, but now we’ve got 100 rentals and without really much pushing.”

Arthur Jennings, Managing Director at Fortwell Capital, expressed the view that this is a rapidly growing market, he said: “Purchasing bulk rental models is going to be an attractive asset.” Fortwell Capital are a privately-owned debt fund that have “residential schemes in Manchester, Birmingham and land in London.”

Jennings revealed Fortwell Capital’s extensive investment in the sector: “We have 4 loans, historically funded and are currently funding 34 homes, over 2000 beds, nearly £200m worth of lending of which we’ve got half of it back.”

One of the three firms they are sponsoring is Macc Group, which own 6 retirement homes in the Birmingham area.  

The model still faces limitations, particularly in initial phases which Shaw described: “The biggest barrier we come across is from a planning perspective, particularly when talking about GLA and London areas.”

Both Audley Group and McCarthy & Stone had shifted from outsourcing the care work, into taking care work in-house. Minimizing risk was vital to both of their rationales, as Shaw described: “We would rather take that responsibility, we don’t think it would de-risk it to outsource care.”

People are living increasingly longer lives, and it is all the more important that they are well-lived. Creating places where older people can live with appropriate care but also autonomy has the potential to create a real positive impact, whilst easing the pressure on the social services we all rely on. [/emaillocker]