IT’S a waiting game. Developers are warily watching the competition in anticipation of a cautious leap into building homes for seniors — an untapped niche market in Malaysia.
Going into 2014 and facing headwinds, developers can be expected to continue trawling for innovative project concepts to stay ahead of the pack. On their radar screen, for sure, is the development of senior living communities.
In the past decade, developers — both big and boutique — successfully wooed buyers with interesting concepts and schemes. These helped boost demand, which was already high due in part to the easy availability of credit.
Take the sexily branded SoHo (small office/home office), SoVo (small office/versatile office) and now SoFo (small office/flexible office). In reality, purchasers are buying high-rises, typically measuring a modest 450 to 750 sq ft, with commercial titles. These relatively small units have become entry-level investments for owner-occupiers and investors alike. But whether they are put to commercial use is anyone’s guess.
On the residential property front, developers deserve a pat on the back for embracing green and eco-living principles and branded lifestyle concepts.
In high-rise developments, common facilities such as lounges and swimming pools have now been moved from the ground floor to the highest levels. The topmost floors used to be reserved for premium-priced penthouses. The idea now is to allow residents and their guests — not just those living in the penthouses — to experience the “top of the world” feeling and views from up high. Needless to say, this has been well received by the market.
On the landed home scene, super-link terraced houses and zero-lot bungalows are now familiar terms with property watchers and buyers. Landscaping concepts, meanwhile, have shifted from the mystical Balinese influence to the clean lines of Zen, and have now gone back to the familiar tropical styles. Cycles, it seems, are not just confined to property demand, fashion or styles.
Back to building senior living homes in Malaysia. Certainly, it wasn’t for lack of trying. Ask Datuk Alan Tong, also known as Malaysia’s Condo King (see Page 5).
It is not all about timing, pricing or even cultural considerations or taboos. The property mantra of location, location and location helps, but that is not sufficient to excite the market. When buying a property means more than just putting a roof over one’s head, a sound business model is vital.
This is what Tong found out to his dismay. Despite conducting numerous surveys and meetings with prospective buyers, Mont’Kiara Sophia (named after one of the stars in the hit TV series Golden Girls) in its original form did not take off.
Tong puts it down to the timing as well as the price. The development was well ahead of its time and people were not about to pay a significant premium for a new and untested concept that went beyond design and aesthetic.
Investors want a clear exit plan. They need to be assured of value creation in their investment. They will not buy into a senior-living project built and marketed like traditional real estate.
Developers, for a start, are not expected to walk away from the project upon its completion and handover. Undisrupted quality maintenance and services tailor-made for the residents are a given.
Will the young be willing to move into the premises some day? Will there be willing tenants? Given the niche nature of such projects, there are bound to be limitations on market interest and thus, value.
While the developers are studying the challenges, the government has realised that it has to get involved to safeguard the interests of the growing ageing segment of the population. Laws have to put in place, drawing from the lessons learnt by countries that have gone through the experience. But they have to be tempered with the cultural sensitivities and practices unique to Malaysia.
Australia is well known for its senior living communities, but what is interesting is that in India, where taboos abound, building for seniors is fast gaining momentum in response to their growing number.
Of old folks and nursing homes
In Malaysia now, senior living usually means charity-based old folks homes or nursing homes that can be a pricey option.
Growing demand for quality nursing homes has led to some individuals exploring the idea of building retirement housing for seniors. The jury is still out on how successful these will be.
And so, the waiting game among developers continues.
This article first appeared in The Edge Malaysia Weekly, on December 23, 2013.
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