Boom in senior living market: Elderly become king of real estate, builders make mega bet of ₹13,000 crore, Tier 2 cities become new hotspots

A major structural change is being witnessed in the Indian property market, where the elderly i.e. senior citizens have now come at the center of the new growth story of real estate. According to the latest report by real estate consultancy firm Colliers, real estate developers and private equity (PE) funds have committed to invest more than Rs 13,000 crore for senior living projects. About 75,000 new senior living units will be built across the country with this capital in the next 3 to 4 years. The changing lifestyle of the elderly, increasing purchasing power and increasing need for organized and secure residential complexes have transformed this sector into a mainstream asset class.

Why are Tier 2 and Tier 3 cities becoming favorite hotspots?

Till now senior living projects were limited only to metros, but now the focus of developers is increasingly turning towards smaller and quieter cities. According to the report, 30% to 40% of the total new projects to be launched by 2030 will be in Tier-2, Tier-3 and religious cities.

• Major emerging centres: Coimbatore, Dehradun, Puducherry and Vadodara.

• Spiritual Destinations: Ayodhya, Vrindavan and Tirupati.

Low cost of living, serene environment, less pollution, improving healthcare infrastructure and availability of affordable land in small cities are attracting the elderly as well as builders in a big way.

Estimated to be a market worth ₹1 lakh crore by 2030

The current organized senior living inventory in India is only around 25,000 units, while the current demand is 20 to 22 lakh units. This demand is expected to increase to 30 lakh units by the year 2030. The potential of the market can be gauged from the fact that this sector, which is currently worth about ₹ 30,000 crore, can grow four times and cross ₹ 1 lakh crore (Rs 1 trillion) by 2030.

Strategic alliance of healthcare and realty

The scope of senior living has now completely changed from the old age ‘old age home’ to premium ‘independent and assisted living community’. Builders are now entering into direct tie-ups (JVs) with leading healthcare service providers like Max, Apollo and Fortis. Modern amenities like 24×7 on-call doctor, ambulance facility, wheelchair-friendly infrastructure, physiotherapy centre, nutritious dining and club house are being provided in these societies.

Investors’ confidence increased due to RERA and government rules

The model guidelines and strict RERA rules set by the government for senior citizen housing have enhanced transparency, quality and accountability in this segment. Due to this, not only domestic retail investors and NRIs are buying secure homes for their elderly parents, but big global institutional investors are also investing huge capital in this sector.