Senior citizens who were expected to pack into retirement residences are instead opting to stay home. This has left hundreds of luxury suites in high-end B.C. retirement homes sitting vacant.
According to the Canada Mortgage and Housing Corp.’s (CMHC) annual Seniors’ Housing Report British Columbia, the average vacancy rate for independent living suites was 12.6 per cent in 2012 compared with 11.5 per cent in 2011. The average rents are $2,672, up 3 per cent from 2011, CMHC reports.
In Metro Vancouver the typical vacancy rate for a retirement community is 13.7 per cent, compared to around 2 per cent for a typical apartment building.
Some high-end retirement communities, however, are suffering up to 80 per cent vacancies and some are being sold at deep discounts.
An example: the 135-unit Astoria luxury retirement community in Port Coquitlam boasts a private movie theatre, five-star meals, nursing care and landscaped grounds complete with a waterfall but was nearly vacant since it was built 3 years ago. It had a 41 per cent vacancy rate when sold to Leisureworld Senior Care Corp. of Toronto this year. Cedarbrooke Chateau in Mission and the Renaissance Retirement Residence in Squamish both went into receivership last year after suffering from a persistent 54 per cent occupancy rate. In Osoyoos, the Cactus Ridge Retirement Residence, which opened just last year and suffered a near-80 per cent vacancy rate was put on the block in May for $14 million through Cushman Wakefield.
As of November, the listing had expired and a spokesman for Cactus said they “were looking at all options” in an attempt to sell. They had received no offers at the asking price of around $152,000 per door. The spokesman confirmed that only one-fifth of the rooms are rented, at an average rack rate of $1,889 per month.
Where are all the seniors?
Based on BCStats data, the number of people over the age of 65 has climbed 33 per cent in the last decade and is expected to double to 1.46 million by 2036. So what went so wrong with the notion that BC, which has the highest number of senior per capita in Canada, would mean a boom for high-end retirement homes?
Simply put, seniors are staying in their own homes and even buying even better homes. The proof is in the 2011 Census of Canada figures, which show that only 8 per cent — or just 1 in 12 — people over the age of 65 live in a retirement community. For those aged 65 to 74, 98 per cent continue to live in their own home. Even at age 85, only 10 per cent live in a “residence for senior citizens,” while 41 per cent own and live in their own single-family detached house.
According to a Housing Report released this week by Altus Group, the “real boom” in retirement residences is at least 20 years away.