Elderly care development in China is attracting more and more foreign investors, and the increased aging of the Chinese population has something to do with it.
More and more Chinese and international investors are looking into elderly care developments. The strong development in the sector is due to the rapidity with which China is aging.
According to China’s latest demographic data, the number of people aged 60 and over has increased by almost 50% over the past ten years, to 260 million today. A figure that represents 18% of the Chinese population today. By 2050, it is expected to almost double to nearly 500 million.
Moreover, it is estimated that 10% of people over 65 years old choose to move to a retirement home, and only 2 to 3% are willing to pay the price.
Faced with this data, many luxurious retirement homes are developing in the country. This is the case of the Ardor Gardens establishment, which offers fully equipped facilities. Residents can enjoy indoor swimming pools, yoga rooms, wine tasting and 24-hour treatments.
Australian real estate and infrastructure company Lendlease has invested $280 million in Ardor Gardens. It is one of several investors who see a future in the sector, especially with the political environment becoming more favorable.
“The market will probably be completely different in 10 years,” said Lendlease’s Chinese president, Ding Hui. “If you wait 10 years before you start thinking about buying land, learning, building a team and developing a business model, you would most likely have missed the opportunity.”
According to Ding Hui, you have to look ahead five to 10 years to realize that the demands will be greatly increased and that there is a “real challenge ahead.”
Lendlease is not alone in its interest in this growing market. A few national players, including blue chip insurers, private equity firms as well as real estate developers are moving into the luxury retirement home space.
For now, many of these companies have yet to make a profit in the senior care sector. They are banking on the growing demand for such facilities as well as changing societal norms in China that may become more profitable in the future.
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Featured Photo / Source : Christophe Caranchini
