Article
Swiss People Volunteer Now and Timebank Lets Them Access Seniors Care Later
September 22, 2022 4 Minute Read
Like clockwork, the Swiss have come up with a creative way of incentivizing seniors care while also addressing the anticipated shortage in seniors housing in the coming decades.
Here’s how it works: Citizens volunteer to help seniors with everyday tasks such as cooking, gardening or housecleaning, or taking them shopping or to appointments.
The number of hours spent caregiving earns credits that are deposited into an individual’s social security account. And when that person needs a helping hand later in life, they can use their credits to receive that assistance from others.
More than 30 other countries have time banks, though most aren’t specifically seniors-focused as is the case in Switzerland.
What most Western countries have in common is a demographic wave that will strain support for seniors.
Creativity and planning are going to be needed to accommodate our aging population.
Time Is Housing
It would be ideal if time bank credits could be used to secure seniors care services when we all reach the point that we need a bit of help ourselves. Canada could be the first to pilot such a program.
In the meantime, CBRE has been doing its part to ensure the Canadian seniors population has viable housing options.
The seniors housing sector has been experiencing a serious post-pandemic boost thanks to an influx of investment in the sector over the last two years, and CBRE has been at the heart of the action.
Institutional healthcare investors, major American players in particular, are recognizing that the under-served Canadian seniors living market offers a host of investment opportunities with the silver tsunami looming ever larger.
By 2040, only 18 years from now, Canada’s 75-plus population is forecast to grow by 118%, and the 85-plus cohort by 146%, compared to only 22% for the under-75 population.
At the same time, rapidly rising construction costs have caused new construction of seniors living assets to grind to a halt in Canada.
“Seniors housing is still regarded by many mainstream domestic investors as an alternative asset class” says Mat Burnett, Senior Vice President, CBRE Healthcare.
“But some prescient Canadian groups, mostly backed by sophisticated American investment capital, are seeing that these assets offer considerable rental rate upside.”
Active Seniors Sector
New York-based Blackstone Real Estate Group, the biggest real estate investor in the world, in 2021 created a joint venture with Selection Group to acquire a portfolio of 13 seniors living properties in Quebec from Revera Inc. for $571 million.
“These investors see that there are cashflow improvements to be had with Canadian seniors housing stock that could make for a significant return, with potential yields of up to 7% in time,” Burnett says. “That’s far higher than the conventional asset classes like industrial and multifamily.”
The deals include the CBRE-brokered sale earlier this year of a $307.5 million portfolio of 11 retirement living residences in Ontario and Saskatchewan for Extendicare to a JV of Markham, Ont.-based Sienna Senior Living and Maryland-based Sabra Health Care REIT.
That same JV then paid $72 million to acquire The Village at Stonebridge, a Saskatoon retirement residence with 186 private-pay suites.
Those deals came on the heels of CBRE’s sale last October of six residences from Hawthorn Senior Living to Chicago-based Ventas REIT for $226 million.
A Hawthorn seniors living property in Alberta
Very Little Supply
It’s been an impressive acquisition spree for the seniors housing sector. But Burnett notes that these deals don’t address the dire need for new product to be developed across Canada.
“We’re at the front edge of the baby boomer retirement wave,” he says. “There’s a huge surge of demand coming into the seniors space and very little supply.”
Mainstream domestic real estate investors have been hesitant to go big in the seniors living space in part due to an unfamiliarity with the asset class and the high risk-weighted returns that it offers.
But now, Burnett says, with occupancy returning, capture rates rising steadily and demand/supply imbalance foreshadowing the outsized income growth to come, seniors housing investors stand to benefit greatly.
“The time to act is now, before the demographic bulge puts millions of potential new residents at their doorsteps over the next decade.”
Recent Insights
-
Fraser McKenna and his team are working with Beedie, a West Coast residential and commercial developer, to sell industrial condo units at BOLT, its new development in Bolton, ON.
-
The Canadian retail sector faces robust demand, low vacancy rates and limited construction activity, but CBRE’s Alistair Corbett says new developments are about to kick off in Alberta.
-
CBRE Group, Inc. earlier this year combined its project management business with Turner & Townsend, a majority-owned subsidiary that provides program management, cost consultancy and project management services globally.
Stay In The Know
Subscribe today and join hundreds of professionals who get the latest blogs delivered straight to their inbox.