Living Well

AUSTRALIAN PROPERTY INSIGHTS

LIVING WELL

SECTOR OVERVIEW

Australia’s Retirement Living sector has evolved into an attractively structured and increasingly investable part of the living asset spectrum. While it shares some characteristics with aged care, it’s better understood as independent living with optional support, wrapped in a financial model that suits both residents and long-term capital.

There is also a lot of opportunity for consolidation in the sector due to its fragmented nature. The landmark acquisition of Aveo by The Living Company earlier this year, Australia’s largest ever direct real estate transaction, illustrates the institutional appetite for the sector and how Retirement Living is becoming a core pillar of Living sector strategies.

At its core, Australia’s Retirement Living Sector operates on a resident-funded leasehold interest model, where the Deferred Management Fee (DMF) enables lower upfront pricing for residents and future revenue realisation for operators. Australia’s model is increasingly viewed favourably by global investors for its mix of attractive qualities – offering scale, tenure stability, and policy alignment.

CHART 1

GLOBAL RETIREMENT LIVING MODELS – STRUCTURAL COMPARISON