Retirement villages see rapid growth

New Zealand had 32,854 retirement village residents at the end of last year. Photo / NZME.

Nearly 33,000 New Zealanders live in retirement villages, up from just over 24,000 people three years ago.

Angela Webster, economist and research consultant at real estate specialists JLL in Auckland, has released a study on the retirement village sector, showing rapid population and village growth.

New Zealand had 32,854 retirement village residents at the end of last year.

"There are a number of drivers responsible for the increase in demand for retirement village living, with the ageing population, an increased acceptance of retirement village living and increased product availability being the main influences," the study said.

It found the villages were becoming much flasher and more expensive and said operators might soon have to pitch harder for buyers.

"A notable level of supply at the premium end is coming on to the market. This is expected to cause increased competition for residents.

"New premium units entering the market are, to some extent, offset by older stock exiting the market, which means falling supply levels for more affordable retirement accommodation at the lower end," it said.

"Of the 363 registered New Zealand retirement villages, 75 had some level of development pipeline, Webster found.

A total of 5188 units are planned, of which 1511 are in Auckland. A total 51 entirely new villages are planned "all in widely varying stages of planning and development," the paper said. This is an increase of 15 villages or 42 per cent from the 36 villages which were in the pipeline at the end of 2013.

Ryman Healthcare now has 27 villages with 4305 units, increasing its market share from 16 per cent to 17 per cent. Metlifecare has 3928 units in 24 villages and a 16 per cent market share, and Summerset has 19 villages, 1926 units and 8 per cent market share.

Arvida Group listed on the NZX in November last year and has 17 facilities, both retirement village and aged care based, the paper said. Arvida has about 800 retirement village units.

"While the development pipeline is understandably robust in areas such as Auckland ... the smaller cities and more rural environments should not be ignored, the report said.

"Many of New Zealand's smaller cities and districts are forecast to age quicker than the major urban areas, pushing forward the demand timeline for retirement village accommodation."