With an ageing population and demographic shift that is seeing the number of people aged 65 and over increasing across the UK, the care home and senior living sector is one that has been establishing itself as a key real estate market for the last few years.

For Scotland in particular, figures from the Scottish Government in 2019 showed that there are currently just over 1 million people aged over 65 living in Scotland, with this demographic set to rise to just under 1.3 million over the next 10 years. Furthermore, in 2019, those over the age of 65 owned £96 billion in housing equity, accounting for 47 per cent of all Scotland’s homeowner housing wealth.

However, in terms of the pipeline for care home and senior living accommodation, Scotland is hugely under supplied, creating a substantial opportunity in the sector moving forward.

When talking about what opportunities may lie within the sector, it’s important to note that senior care and retirement living has become a varied and diverse market. We have moved on from the one-size-fits-all approach from years gone by to facilities and housing that cover the entire care spectrum, from the most full, around-the-clock care, through to schemes that offer no care but have medical availability on site.

One particular change we have noted is the increased level of independence of those in their later years combined with a higher age of people entering care homes. The varied levels of care and accommodation required open up an even greater breadth of opportunity whether you’re an operator looking for new prospect, a developer or a land owner looking for an alternative or complementary use.

A result of this, rise in demand for a more diverse product has resulted in the increase in popularity of senior living, which is essentially housing that is designed, built and let/sold exclusively to those who are typically aged over 50 or 55 but doesn’t include the supportive on-site management characteristic of sheltered housing.

In Scotland there are currently very few dedicated senior living operators, albeit we are seeing heightened interest in this sector and growing interest from operators that are currently only active south of the border. As a result, this sector is on the cusp of new activity in Scotland with development most likely to be focused around the hot spots of Edinburgh, Glasgow and Aberdeen, where there are more dense populations.

A prime example is a recently newly launched development opportunity in Cults, Aberdeen, one of Scotland’s most affluent and desirable suburbs. The Community Retirement Village has planning permission in principle for a care home, 95 residential units and retail accommodation and provides a great platform for a new entrant to capitalise on the potential that this emerging market offers.

In order to meet this increasing demand, we also expect to see a growing number of opportunities for this sector to aid the repurposing of obsolete retail, leisure and hotel properties by targeting a unique but underserviced market and therefore reducing delivery risk.

There is currently a real window of opportunity for the elderly care and housing sector in Scotland, not only for operators and developers but also investors who have already got the region firmly on the radar.

Further information

Contact Graham Reid 

Contact Savills Senior Living