According to the data from the private senior-care service agency information survey research group of the Office under China National Committee on Ageing (2008-2009), only 21% of over 4000 private senior-care service agencies surveyed enjoyed the land allotted by the Government, 36% acquired the right of land use in the form of leasing, and over 40% were confused of the national of used land. 

      To be honest, the family structure of “4 grandparents, 2 parents and 1 child” brings about new opportunities and new space to the real estate enterprises and the development of senior-care industry has a huge prospect; however, due to lack of available land, many real estate enterprises acquire the land by bid, auction and listing, adding their development costs. Besides, the senior-care industry has a big investment in the early stage and a long return period (7-10 years universally recognized), so many real estate enterprises hesitate for the reason of land. Land use becomes the first obstacle for smooth implementation of senior-care real estate project. 

How do we promote the elderly-related economy? How do we allocate the private capitals to participate in this huge “senior-care engineering” more actively?

The author believes that the Government and real estate enterprises ought to think about the following aspects:

Differential treatment

Based on the current development situation of our senior-care industry, the land used for senior-care real estate is not independently divided and has no specific policy support, thus causing the land insufficiency for senior-care projects in the land supply plan. “When land is rare, it becomes precious.” Land resource shortage made the development cost of senior-care real estate generally high. 

Therefore, the author advices that the Government has to eliminate the policy “blind spot”, pay attention to market allocation and corporate management, fully consider the demographic factors of its region when doing the regional planning, and incorporate the senior-care real estate (middle and low-grade, high-grade) into the regional planning. In addition, the land supply for senior-care real estate should be treated differently according to the development orientation and the customer base: for the middle and low-grade senior-care real estate (welfare nursing homes) for specific groups, in order to satisfy the basic needs of such elderly people, thus to provide them with a happy and dignified life style, the Government should lower the threshold for entry into the planned senior-care real estate, provide the low-cost land and offer certain policy guarantee. However, the land for welfare nursing homes should be banned from entering the market. Surely, we can also consider the practice of land for affordable housing and reduce the cost of land use, but this requires the Government to give certain preferential treatment in land transfer fees or taxes.

For senior-care real estate projects performed by enterprises, such as high-end senior-care leisure communities, they generally adopt the operating methods including renting, selling property rights, direct buyouts, etc. Land use should conform to the market rules and be achieved by bid, auction and listing. However, it is necessary to effectively avoid the “development of real estate in the name of senior care.”

In addition, in order to solve the dilemma of no available land for senior-care real estate, some enterprises or local governments that want to make achievements in the field of senior-care real estate have come up with another solution, namely, co-construction and reconstruction. For example, Shenzhen solved the difficulty of land use for senior-care real estate through the renovation of old factories, houses and other properties. “Healthy senior-care real estate” (JKYLDC), the official WeChat account of “China’s healthy senior-care real estate service union”, concentrates on health-care and senior-care real estate, health care real estate and senior-care industry. At the same time, it also stipulates that in the construction, reconstruction and expansion of affordable housing and policy housing, it is necessary to think more about the special and low-income seniors.

Including it to the major plan

Whether the senior-care real estate enters to a virtuous circle depends on the policy environment. The Government shall consider the senior-care real estate projects in the large service system of the whole city in terms of urban construction and land planning.

For instance, the senior-care planning of Singapore has anticipated the development in the next 40 to 50 years, determined a rough plan for land use classification and reserved enough special land. This planning is worthy of being learnt.