The amount of money seniors will spend by 2050 presents huge opportunities for business

The domestic market for providing essential services and products to the elderly will account for 33 percent of GDP by 2050, climbing from a mere 8 percent this year, a report on the industry says.

The China Report on the Development of the Silver Hair Industry by the China Research Center on Aging, published on Sept 23, says the market will be worth 4 trillion yuan ($651 billion) this year.

But China will become the largest market for businesses serving senior citizens by 2050, when those over 60 will account for about a quarter of the world's total senior population, and they are forecast to spend 106 trillion yuan a year then, the report says.

Property developers who plan to cash in on this market should be thinking about the long-term, and the projections that come with it, experts say.

Building retirement homes is completely different from building normal residential buildings, says Liu Xiao, general manager of Zhejiang Vanke Narada Real Estate, a subsidiary of China Vanke, the largest residential developer in China.

"It is service that will lie at the core of the senior-care industry in the future, and retirement properties built based on current market characteristics are very likely to fail the requirements of the aged in even five years, so developers should plan their projects with a long-turn vision," Liu said at the Care Show China 2014 held in Shanghai in August.

Over the past two years, at least 32 companies in China have said they plan to enter the retirement property market, National Business Daily reported recently.

Liu was invited to introduce the Dignified Life, a well-known Vanke retirement property project, to industry insiders at the Shanghai show. While most companies are still in the planning stages of their projects, apartments in Dignified Life have sold well since they went on the market in 2013, and sales were worth 3.5 billion yuan last year, making it a leader in the city's real estate sales last year, Vanke says.

The Dignified Life retirement property is being marketed as "neighborhood senior living" and is located in Liangzhu new town, a scenic spot 16 kilometers from Hangzhou, in Zhejiang province.

"Tackling the challenge of China's aging populations is about more than just providing houses suitable for the aged to live in, or medical care," Liu says. "The critical thing is to maintain their social connections and communication, to meet their emotional demands and help them revalidate their own values."

Dignified Life was designed after research was done on 50 high-end senior care communities globally, including in Australia, Japan and the United States, and after research on the physiological, psychological and behavioral characteristics of Chinese seniors.

The community covers about 63,000 square meters, and there are some 615 senior care apartments and a nursing home with 122 beds, and communal amenities including a hospital, banks and a supermarket.

Given that Liangzhu is a scenic attraction, the weather and surroundings are also highly attractive, Liu says.

In the central area of the community is a recreation area covering 4,500 square meters, including restaurants, reading room, chess and card room, teahouse, gyms and performance halls.

"For many retired and aged people, changes to old lifestyles can be daunting, so the aim has been to provide them a way of life that is varied and fulfilling and that makes them feel more connected with other people," Liu says. "Here it is easy for them to get to know neighbors and gain friends."

Taking account of the close bonds between Chinese parents and their children and ensuring the home is not too remote is a good selling point, he says.

"When we planned this project, Liangzhu's proximity to Hangzhou was regarded as a key asset. For us the idea is that parents and children are separated by only what we call a one-soup distance, meaning that if their children make a cup of soup at home they can get it to their parents here before it gets cold."

Wang Qunli, a Liangzhu villager, says what he appreciates about the project is that while parents and children can live happily apart and enjoy their independence, the children can still easily provide any care that the parents want or need.

"If my mother lived in Dignified Life, we would be able to see each other every day and have meals together, and that's reassuring for me," Wang says.

Vanke does not sell the apartments outright, instead giving tenants habitation rights either for 29 years, paying a fee of between 2,500 and 3,200 yuan a month, or for 15 years, with an upfront fee of 1 million yuan.

"The price per square meter is about 20 to 30 percent higher that of the normal residential buildings nearby," Liu says. "That reflects the fact that retirement property is more expensive than normal residential property."

Given the increasing vulnerability of people as they age, the apartments include 40 special features such as structures free of physical impediments, and a one-touch system for obtaining emergency help.

Liu says he expects that eventually the target market will be aged between 50 and 60, even if those moving in may in fact be people older than 75, which means that providing medical care and related services is very important.

The nursing home is run in conjunction with Shulan Medical Group, which was established by two well-known Chinese medical academicians. Zhejiang First Hospital provides outpatient service in the community.

Liu says the senior industry in China will be well developed in another 10 to 20 years, and retirement property has become one of the most important parts of his company's activities.

However, one pressing problem is finding people skilled and dedicated enough to work in the industry.

Apart from medical care, services that the aged need include help in improving communication with their children, courses that help them stay healthy physically and mentally, and help in cultivating interests and expanding their social connections, he says.

"At present, few companies are able to provide good services like these to the aged."

Finding and choosing the right people for the job is one of the industry's biggest challenges, he says.

"The other thing is that there is no standard training system, so the shortage of talent can only get worse."

chenyingqun@chinadaily.com.cn

Top: A hall at Dignified Life, a retirement facility built by China Vanke in Zhejiang province. Above: A free clinic organized by Dignified Life. Photos Provided to China Daily

(China Daily European Weekly 11/07/2014 page15)