Retirement living needs a rebrand

The retirement living sector needs to better communicate what it represents, Levande chief executive officer Kevin McCoy tells Community Care Review.

The one thing he said he always hears from residents across their 59 villages is that they wish they had moved into retirement living sooner.

During research for their rebrand, Mr McCoy said they found 35 per cent of retirees had a negative perspective of the sector but 87 per cent of people living in retirement living villages “love it.”

“So there’s this perception gap on what retirement living is, and I think that’s the job of the retirement living sector at the moment, and it’s certainly the job of me and my team, is this is actually a fabulous product,” he said.

 “Because if you think of loneliness and isolation and those types of things that hit people at that sort of stage in life – average age for us at entry is 75 – this is such a great product for that,” he added.

“Security, safety, you meet new friends, there’s activities, there’s things to do if you want to or not.”

But affordability is a major barrier for people wanting to access these communities.

Mr McCoy said the deferred management fee until exit is what creates affordability in the sector but acknowledged that it is “a somewhat controversial mechanism” and that the sector has done a “poor job” educating people on what it actually means.

“As long as that deferred management fee concept holds and it’s a part of retirement living, then affordability is possible. The other aspect is, we find a lot of our more rural and older villages, because they’re older, and so their prices don’t keep pace with the median house price of the particular locality they’re in, you find they naturally become more affordable in time,” he explained.

But like the aged care sector, the cost of new builds remains an issue, particularly the cost of land.

The challenge, he argued, is that the cost of building is consistent wherever an organisation chooses but the cost of land is dependent on the area, which ultimately leads to organisations being driven to more affluent areas to cover the cost of the building itself.

For example, Mr McCoy said the recent land acquisitions they have made with the intention of building new villages have been in middle-class areas of Sydney like Epping, Castle Hill and the Castle Hill Showground.

Mr McCoy said he is concerned that building costs will, over time, skew retirement living options to just higher middle-class areas but emphasised “we will never be a luxury.”

The future of retirement living

The future of retirement living was a point of much discussion during the 2025 Ageing Australia National Conference, in particular what opportunities Australia could have in exporting its knowledge and experience to countries like India, where the population is ageing rapidly but there are few aged care homes and beds.

Mr McCoy disagreed however, and instead said he thinks Australia should be focusing on its own backyard.

“If you look at the opportunity in Australia, we’ve got a full dance club, why would we be heading overseas? That’s just from a Levande perspective,” he said.

“It’s the reason why we’re not in Western Australia. We’ve got enough to do on the East Coast.

“Why would we divert management time to go and try and grow a brand in the most parochial state in Australia? It doesn’t work,” said Mr McCoy.

“If Lendlease can’t make that work, who’s got a chance? So we don’t even bother with Western Australia because we’ve got so much on the go here,” he added.

Mr McCoy also noted that he believes retirement living to be quite an Anglo-Saxon concept, and that they have not quite reached a point where they are building and buying land on the basis of whether multicultural communities are going to accept the business model or not.

He said there are simply too many existing criteria points to consider when purchasing land, including proximity to shops and health services, and whether it is close to an area where there is already a large community of people turning 75.

But he reiterated that a key thing the retirement living sector needs to focus on is ensuring people understand that it is not a property investment.

“It’s about moving into a community – safety, security, not being lonely, someone’s got your back, you can lock up and go, all of these things,” Mr McCoy added.

“It’s a living experience. But some communities, they just see property as purely investment.”

In the next 10 years, Mr McCoy said he hopes to see market penetration increase.

According to StewartBrown’s Retirement Living Performance Survey Sector Report, market penetration for over 75-year-olds sits at around 12 per cent, which Mr McCoy hopes to see reach 15 per cent in 2035.

“I’d like to think that more Australians are thriving and living in these communities, because it adds time to your life,” he said.

“And the more elder Australians that have the benefit of that, instead of that part of your life spiralling into being lonely and [being] the only person in the street, you don’t know anyone. It’s all unnecessary, really.

“You could move into one of these communities and that stage of your life would actually be one of the best stages of life you’ve ever had, and I think that would be quite incredible – and I’ve watched my parents go through this journey as well, I’ve experienced it as a son.”

Linked to the need for better understandings of what retirement living is, is the need for better operators, Mr McCoy said.

“The industry has had a chequered history, which has caused brand damage and sometimes still does,” Mr McCoy said.

“And more and more operators are now not property focused, so to speak, not property developers… like us, it’s more about the resident experience, and so the more the industry switches to be more about the resident experience, the better it will be.”

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