What is the impact of land tenure on the sustainability of retirement village communities in Australia?

In 2005, 17.3% of Australians were aged 60 years and older according to the Australian Bureau of statistics (ABS). According to aBS this situation mirrors the poulation profile of other developed countries such as Canada, New Zealand, the United States of America and to some extent the United Kingdom (ABS). Self contained independent living units in retirement Villages are now contributing to the dwellings available for those aged 55 years and over in Australia and the retirement village sector has become a significant sector within the residential property market. However, the method of operaton of many retirement villages, and the lack of freehold tenure, impacts on the desireability of retirement village life to potential residents. This paper focuses on sustainability from the perspective of the ongoing viability of retirement village operations in light of the impact of land tenure and operational issues on the perceptions of potential residents.

Valuation methods for resident funded retirement villages in Australia : a practitioner's perspective

Designed for independent living, retirement villages provide either detached or semi-detached residential dwellings with car parking and small private yards. Retirement village developments usually include a mix of independent living units (ILUs) and serviced apartments (SAs) with community facilities providing a shared congregational area for village activities and socialising. Retirement Village assets differ from traditional residential assets due to their operation in accordance with statutory legislation. In Australia, each State and Territory has its own Retirement Village Act and Regulations. In essence, the village operator provides the land and buildings to the residents who pay an amount on entry for the right of occupation. On departure from the units an agreed proportion of either the original purchase price or the sale price is paid to the outgoing resident. The market value of the operator’s interest in the Retirement Village is therefore based upon the estimated future income from Deferred Management Fees and Capital Gain upon roll-over receivable by the operator in accordance with the respective residency agreements. Given the lumpiness of these payments, there is general acceptance that the most appropriate approach to valuation is through Discounted Cash Flow (DCF) analysis. There is however inconsistency between valuers across Australia in how they undertake their DCF analysis, leading to differences in reported values and subsequent confusion among users of valuation services. To give guidance to valuers and enhance confidence from users of valuation services this paper investigates the five major elements of discounted cash flow methodology, namely cash flows, escalation factors, holding period, terminal value and discount rate. Whilst there is dissatisfaction with the financial structuring of the DMF in residency agreements, as long as there are future financial returns receivable by the Village owner/operator, then DCF will continue to be the most appropriate valuation methodology for resident funded retirement villages.

Resident-funded retirement village valuations : complications with the application of the DCF

Retirement village assets are different from traditional residential assets due to their operation in accordance with statutory legislation. Designed for independent living, retirement villages provide either detached or semi-detached residential dwellings with car parking and small private yards with community facilities providing a shared congregational area for village activities and socialising. In essence, the village operator provides the land and buildings to the residents who pay an amount on entry for the right of occupation. On departure from the units an agreed proportion of either the original purchase price or the sale price is paid to the outgoing resident. As ongoing levies are typically offset by ongoing operational expenses the market value of the operator's interest in the retirement village is therefore predominantly based upon the estimated future income from deferred management fees and capital gain upon roll-over receivable by the operator in accordance with the respective residency agreements. Given the lumpiness of these payments, there is general acceptance that the most appropriate approach to valuation is through discounted cash flow (DCF) analysis. There is however inconsistency between valuers across Australia in how they undertake their DCF analysis, leading to differences in reported values and subsequent confusion among users of valuation services. To give guidance to valuers and enhance confidence from users of valuation services this paper investigates the five major elements of DCF methodology, namely cash flows, escalation factors, holding period, terminal value and discount rate.

The impact of tenure type on the desire for retirement village living

In 2005 17.3% of Australians were aged 60 years and older (Australian Bureau of Statistics). A consequence of this aging population is the increased use of self-contained independent living units (SCILU) in Retirement Villages by older Australians. The retirement village sector has thus become a significant sector within the residential property market. In seeking to determine the impact of tenure type on the desirability of RV living this paper first profiles a typical SCILU in Australia, before explaining and examining the various tenure types offered by the market. This paper concludes that the multiplicity of offerings of the SCILU product with respect to tenure type, when combined with deferred management fees and participation in capital gains/losses, may be contributing to a lack of clarity in what the SCILU product entails and the security of investment it offers. This perception is supported by litigated disputes and may be damaging the reputation, ongoing viability and desirability of SCILUs.

Retirement villages : time for a change?

In retirement, many Australians relocate to a less onerous form of home occupation. Some downsize their house, or move to a strata title complex. Others, attracted by lifestyle perceptions, move into a retirement village. However, research shows Retirement Village documentation is complex and more analogous to commercial leasing than home ownership. The most recent government review by New South Wales, confirms the need for change. This paper identifies the current retirement village tenure models generally available in Australia. By comparing the various State/Territory systems the authors draw conclusions regarding the adoption of standardised documentation and uniform Australian Retirement Village legislation.

How can land and urban development make houses healthier?

Traditionally, the main focus of the professional community involved with indoor air quality has been indoor pollution sources, preventing or reducing their emissions, as well as lowering the impact of the sources by replacing the polluted indoor air with "fresh" outdoor air. However, urban outdoor air cannot often be considered "fresh", as it contains high concentrations of pollutants emitted from motor vehicles - the main outdoor pollution sources in cities. Evidence from epidemiological studies conducted worldwide demonstrates that outdoor air quality has considerable effects on human health, despite the fact that people spend the majority of their time indoors. This is because pollution from outdoors penetrates indoors and becomes a major constituent of indoor pollution. Urban land and transport development has significant impact on the overall air quality of the urban airshed as well as the pollution concentration in the vicinity of high-density traffic areas. Therefore, an overall improvement in indoor air quality would be achieved by lowering urban airshed pollution, as well as by lowering the impact of the hot spots on indoor air. This paper explores the elements of urban land and vehicle transport developments, their impact on global and local air quality, and how the science of outdoor pollution generation and transport in the air could be utilized in urban development towards lowering indoor air pollution.

Aging, retirement, and changes in physical activity : prospective cohort findings from the globe study

There is increased recognition that determinants of health should be investigated in a life-course perspective. Retirement is a major transition in the life course and offers opportunities for changes in physical activity that may improve health in the aging population. The authors examined the effect of retirement on changes in physical activity in the GLOBE Study, a prospective cohort study known by the Dutch acronym for "Health and Living Conditions of the Population of Eindhoven and surroundings," 1991–2004. They followed respondents (n = 971) by postal questionnaire who were employed and aged 40–65 years in 1991 for 13 years, after which they were still employed (n = 287) or had retired (n = 684). Physical activity included 1) work-related transportation, 2) sports participation, and 3) nonsports leisure-time physical activity. Multinomial logistic regression analyses indicated that retirement was associated with a significantly higher odds for a decline in physical activity from work-related transportation (odds ratio (OR) = 3.03, 95% confidence interval (CI): 1.97, 4.65), adjusted for sex, age, marital status, chronic diseases, and education, compared with remaining employed. Retirement was not associated with an increase in sports participation (OR = 1.12, 95% CI: 0.71, 1.75) or nonsports leisure-time physical activity (OR = 0.80, 95% CI: 0.54, 1.19). In conclusion, retirement introduces a reduction in physical activity from work-related transportation that is not compensated for by an increase in sports participation or an increase in nonsports leisure-time physical activity.

Transitional employment aspirations for bridging retirement : implications for training and development

Purpose: The aim of this study was to identify the transitional employment aspirations and training and development needs of older and younger workers at risk of early retirement due to limited education and/or employment in blue collar occupations. Design/ Methodology/ Approach: A computer based methodology was used to evaluate the demographic effects of gender, education level and occupation group on aspirations pertaining to transitional employment and training and development in a sample of over 1000 Local Government employees. Findings: Older blue collar, secondary school educated and younger workers were less interested in transitional employment than older workers with higher levels of education or from white collar backgrounds. The early retirement risk factors of blue collar work and secondary school education had a more limited effect on perceived training and development needs for older workers. However for younger workers, these risk factors provided the impetus to undertake training to move into less physically demanding or more challenging roles as their careers progressed. Practical Implications: Via the identification of education level and occupation types groups’ transitional employment aspirations and perceptions of preparatory training and development within younger and older cohorts, long term strategies to develop and retain staff may be formulated. Originality/ Value: Past studies of transitional employment have rarely included younger workers or older workers at risk of early retirement. Preparatory training and development for transitional employment roles has not been considered in the literature.

The role of land use and psycho-social factors in high density residents' work travel mode choices : implications for sustainable transport policy

Imperatives to improve the sustainability of cities often hinge upon plans to increase urban residential density to facilitate greater reliance on sustainable forms of transport and minimise car use. However there is ongoing debate about whether high residential density land use in isolation results in sustainable transport outcomes. Findings from surveys with residents of inner-urban high density dwellings in Brisbane, Australia, suggest that solo car travel accounts for the greatest modal share of typical work journeys and attitudes toward dwelling and neighbourhood transport-related features, residential sorting factors and socio-demographics, alongside land use such as public transport availability, are significantly associated with work travel mode choice. We discuss the implications of our findings for transport policy and management including encouraging relatively sustainable intermodal forms of transport for work journeys.

Early land grants and reservations : Any lessons from the Queensland experience for the sustainability challenge to land ownership

Environmentalists have called for a new property paradigm premised on the idea of land ownership as a delegated responsibility to manage land and resources for the public benefit. An examination of Crown freehold grants from the beginnings of settlement until the 1890s in Queensland shows that fee simple titles were granted subject to express conditions and reservations designed to reserve useful natural resources to the Crown, and to promote public purposes. Over time, legislative regulation of landowner’s rights rendered obsolete the use of express conditions and reservations in grants. One result of this change was that the inherently limited nature of fee simple ownership, and the communal obligations to which it is subject, are less transparent than in colonial times.

Developing a rural land investment performance index for New Zealand

Agricultural production is one of the major industries in New Zealand and accounts for over 60% of all export trade. The farming industry comprises 70,000 entities ranging in size from small individual run farms to large corporate operations. The reliance of the New Zealand economy to the international rural sector has seen considerable volatility in the rural land markets over the past four decades, with significant shifts in rural land prices based on location, land use and underlying international rural commodity prices. With the increasing attention being paid to the rural sector, especially in relation to food production and bio-fuels, there has been an increasing corporate interest in rural land ownership in relatively low subsidised agricultural producing countries such as New Zealand and Australia. A factor that has limited this participation of institutional investors previously has been a lack of reliable and up-to-date investment performance data for this asset class. This paper is the initial starting phase in the development of a New Zealand South Island rural land investment performance index and covers the period 1990-2007. The research in this paper analyses all rural sales transactions in the South Island and develops a capital return index for rural property based on major rural property land use. Additional work on this index will cover both total return performance and geographic location.