Auckland, New Zealand: The retirement village sector added 2,298 new units in 2023, but recent data show development is still failing to meet the rapidly growing demand created by New Zealand’s ageing population.
John Jackson, Executive Director of Senior Trust Retirement Village Income Generator (STIG), said the 2,298 units recorded in the JLL Research Retirement Villages Market Review represent an improvement on historical levels. “These numbers are higher than the five-year average of 1,913 units and the 10-year average of 1,696 units,” he said.
Despite this progress, the pace of growth has slowed. Jackson noted that only 350 units were approved in the second quarter of 2024, a fall of 31 per cent compared with the same period two years earlier.
Forecasts suggest the sector needs to expand much more quickly to keep pace with demographic change. The population aged 75 years and older is expected to grow by more than 40 per cent by 2033. To meet the needs of this group, researchers estimate that over 20,000 additional retirement village units must be built in the next decade alone.
The challenge is even more stark over the long term. To match projected demand through to 2048, the market will need to deliver an average of 932 new units every year for the next 25 years. This equates to more than 23,000 additional units.
The shortfall has significant implications. Without a major lift in development, thousands of older New Zealanders could face a shortage of suitable, secure housing when they need it most. The pressure on hospitals, aged care services, and informal support networks such as family caregivers is also likely to intensify.
Shortages in the regions
STIG’s lending footprint spans multiple regions, providing finance to projects in Orewa, Paeroa, Amberley, and Kerikeri. Jackson said these projects highlight where investors are stepping up, but much more is needed.
“Although some building is underway, it isn’t nearly enough,” he said. “Our portfolio shows where investors are backing supply, but there remain areas where demand is unmet. If we don’t lift build rates substantially, older New Zealanders will face fewer options when it’s their time to transition.”
The impact of these shortages extends beyond housing. Jackson said local councils and healthcare planners need to factor the gap into their planning for transport networks, aged-care capacity, and community services.
“In regions where retirement village infrastructure is lagging, seniors may face isolation or lose access to integrated wellness amenities,” he said.
STIG’s purpose is to deliver returns to investors while contributing to the development of high-quality retirement communities across New Zealand. The organisation provides secured lending to the senior living and aged care sector, financing trusted operators to grow the supply of villages and facilities.
Through this approach, STIG supports the creation of communities that cater to the health, well-being, and social needs of the country’s ageing population.
Jackson said investors play a pivotal role in addressing the shortfall by funding developments that would otherwise struggle to proceed. “The need for capital is constant. Every completed village gives older New Zealanders a safe, connected place to live, while also freeing up traditional housing stock for younger families,” he said.
He added that aligning investor returns with community outcomes is core to STIG’s model. “When we back quality operators, we are also supporting healthier, more resilient communities nationwide.”
Senior Trust Retirement Village Income Generator Limited is the issuer of the investment products. A Product Disclosure Statement is available on the company’s website at www.seniortrust.co.nz.
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Senior Trust Retirement Village Income Generator Limited provides secured lending to New Zealand’s senior living and aged care sector, supporting trusted operators to develop quality retirement communities while delivering consistent returns to investors
