Manager of Carter Court Chris Clarke said the move was "all good for the community" because it would improve access to healthcare for the elderly in Carterton and South Wairarapa.
"With people staying in the community longer -- and when they come into fulltime care their care needs are greater -- we need to respond to that by being able to offer a better range of care, especially as people get older and the complexity of health and wellbeing increases as well.
"In Carterton, like all of Wairarapa, we have an ageing population and the need for these facilities will increase so for Carterton the effect is positive."
The addition of more hospital-level care in Carterton was good news for elderly residents who might otherwise have faced a move to another town, Mr Clarke said.
"It will allow people to stay in their community and close to friends and family and places that are important to them. The last thing you want is people having to move away from this community as they get older, as that increases isolation."
The upgrade had been on the cards for a while and it was great to realise one of the rest home's long-term plans, he said.
"Last year was a real milestone for us -- this is helping us to ensure our future and at the same time responding to the needs of our community.
"Effectively it's an investment for the future because, if we don't provide a broad range of care, we will slowly fall out of step with what is happening within the aged care sector. These days you've got to be able to provide hospital care.
"It's all part of our plan to have a range of options."
The respite bed available for community use would also allow carers to take some time out, Mr Clarke said.
Carter Court plans to recruit four or five full-time nurses.
