As part of our mission to invest in the people, ideas, and industries that will change the world, Octopus is empowering older people by investing in retirement communities.
So much changes as we grow older. By 2043, nearly a quarter of the UK will be aged 65 and over.1 Having a fit-for-purpose home, access to healthcare, and a supportive community can make all the difference.
It could be weeks until you next hear another person’s voice.
This house used to be bustling with activity and joy. But it’s just you now.
The kids moved out years ago – they’ve families of their own. And over the years, close friends have either moved away, or their ill health and advancing years prevent them making the journey to see you.
With every passing day, the stairs become harder to negotiate, and the empty rooms seem more and more burdensome to maintain.
But it doesn’t have to be this way.
The ageing population is one of society’s biggest challenges
“Our ageing population, not just in the UK, but across the developed world, is one of our biggest challenges over the next twenty years,” explains Kevin Beirne, Head of Retirement at Octopus Real Estate. People’s needs can change drastically in later life. It’s not uncommon for older people to find themselves isolated, in housing that’s too big and doesn’t meet their needs, and with poor access to services.
Helping the ageing population move into suitable housing can keep them independent, improve their quality of life, as well as free up larger homes to be used by the next generation of families.
Retirement communities are an important part of this picture.
Helping unlock a better future
In the UK there is a significant skew of wealth towards the over 65s. This makes sense, as many of these individuals have paid off their mortgages, they’ve benefited from a prolonged period of house price growth, and they’ve made long-term investments.
“Some individuals are in a great position where they can use the equity they’ve built up to enjoy a better retirement,” explains Kevin. “Downsizing from a property and releasing that cash to plan for later life is often an important part of the journey for an older person. As investors, we’ve got a significant role to making that as great an experience as possible.”
I wanted to be somewhere where things were going to happen around me, where I could meet people, talk to people, join groups and clubs, and do things with other people.John Reddington, resident at a village managed by Octopus
Retirement communities is a growing part of the real estate story in the UK, however it’s probably the smallest segment within the operational real estate sector. But, when you consider our ageing population, it’s the area with the biggest potential to empower people.
Why we invest in retirement villages
We’re focused on investing in integrated retirement communities. You might know them as retirement villages. They’re not just about housing, they’re about the wraparound services. They’ll have restaurants, they’ll have a health facility, a spa and pool – so it’s an opportunity to enjoy a quality lifestyle alongside some of the best age-adjusted real estate you’ll find.
“Octopus is attracted to investing in retirement housing for two big reasons,” says Kevin.
As you’d expect, one reason is potential return. “This is a relatively nascent market and an area with lots of opportunity,” explains Kevin.
The other reason is that we feel there’s an enormous opportunity to help address the needs of our ageing population.
“We want to invest where we can have the broadest and deepest set of benefits for society. Retirement housing can have a fundamental impact on preventing ill health and encouraging independence in later life.”
I realised then how enclosed my life was and how low it could make me if I wasn’t careful.Heather Holwell, resident at a village managed by Octopus
“An integrated retirement community allows much better access to friends and services. That’s really empowering older people to plan for their future in a way which meets their aspirations.”
Making a difference to people’s lives
“When I first joined Octopus, I attended a residents meeting of one of the communities we manage,” recalls Kevin. “I was locked into a detailed conversation with one resident about service charges, when a woman came up to me and tapped me on the shoulder.
“I thought, ‘Perhaps she wants to talk to me about fees or some other financial element of our offer.’ But she said, ‘I just want to thank you, because moving here has completely changed my life. It’s the best decision I’ve ever made. I’ve made such a great group of friends, I’m active, and I’m doing things which I never thought I would do.’
“As investors, we spend so much time looking at spreadsheets and returns. But isn’t it great to see the difference investment can make to people’s lives?”
This is a story about one of our investment sectors and is not an investment recommendation.