Retirement Villages : Best Practice Planning

1. Retirement Villages : Best Practice Planning A Developers’ Perspective Peter Inge August 2008

2. Retirement Living in Australia Retirement living industry has evolved considerably since the 1960’s when church and charitable groups first introduced housing for the elderly • Private groups have since entered the industry and employ a resident funded model • The resident funded model provides a lifestyle option for independent people, with community facilities, on site management, maintenance and security

3. Retirement Living in Australia A Retirement Community is: A Retirement Community is not: • A neighbourhood for over 55/60’s • Similar minded people • Community like facilities • Community and companionship • Low maintenance • Independence and privacy • A supported residential service • An aged care facility • An “old people’s home” • A special accommodation home • A hostel

4. Retirement Model in Australia • Available to residents aged over 55 years • Resident pays for retirement unit (purchase price / lease premium / loan) • Resident resides in unit and has non exclusive rights to community facilities • Resident pays a weekly service fee • On departure, resident pays a deferred management fee / exit fee / departure fee (“DMF”) • DMF based on length of stay, usually a fixed % each year applied to the resale price of the unit

5. The Emergence of the Medium Rise RV • Traditional • Broad acre • Typical site c 5 to 8 ha • 125 to 200 villa units • Community Centre • Garden areas and open space • Can certainly be bigger but not too much smaller • Well located • Public transport • Shops • Sense of neighbourhood • Medium Rise • Infill sites • c4000m2 to 20000m2 • Minimum c60 apartments • At least 2 b/r • Query “diversity of housing” if no one wants to live there • Cater for the target market • Costly to develop • Generous community facilities • Well located • Absolutely critical

6. All developers are not the same! • “Normal” Developer • Maximise financial return • Maximise yield • No post completion interest • On to the next one • Misalignment of interest with end user • RV Developer • “Long tail” asset • Greater returns in management • “Skinnier” development margins • Delicate balance between yield and amenity • Maximising amenity means greater price growth • Greater price growth means greater revenue • Clear alignment of interest • RV needs to look great not just now but forever

7. RV Planning issues • Some Myths and Misconceptions • Grey ghetto’s • Solution? Forced community integration • Compromising security • Boundary fencing is important • Traffic/Car’s • Always less than you think and decreasing over time • Solution? Access to public and private transport • Village bus service • Burden on Local Government infrastructure • Majority of residents are locals • More efficient service delivery

8. The Future - Shifting the Burden • Resident funded RV’s reduce community responsibilities and should be encouraged • Less usage of HACC, CACP’s funded aged care • People prefer to be independent • Planning protections/restrictions need to assist controlled RV development • Example NSW SEPP (Seniors Living)2004 • Site Compatibility Certificates • Use of covenants in Government land sales • Example Vaucluse High School • Positive – must be seniors living • Negative – Can’t be school

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