A caretaker conducts a health check for a senior citizen at Vanke's Dignified Life Project in Liangzhu, Zhejiang province. (Photo provided to China Daily)
Vanke, the country's largest property developer in terms of market value, has branched out into senior citizen care services.
In fact, the realty behemoth sees the segment as one of its future growth engines. That is because the traditional real estate sector has been slowing of late.
The company recently unveiled its ambitious plan for the senior care industry. Called the Dignified Life Project, it includes the country's first senior care industry ecosystem in the Yangtze River delta area.
"Over the next three years, the Dignified Life Project will set up 1,000 branches, covering more than 600,000 senior people with over 50,000 direct clients," said Li Wei, general manager of Vanke's Hangzhou unit.
The project consists of three lines: apartments for senior citizens who can look after themselves; a family-style elderly rehabilitation nursing center; and a community service center for senior citizens.
Seven years ago, Vanke Hangzhou set up a "Dignified Life" project in Liangzhu, a scenic spot 16 km from Hangzhou in East China's Zhejiang province. The community covers about 63,000 square meters. There are 615 senior care apartments, a nursing home with 122 beds, and communal amenities like a hospital, banks and a supermarket.
Such apartments are rented out for a long period, and not sold outright. Typically, the 15-year rent for a two-bedroom apartment works out to around 1 million yuan ($143, 000), and the monthly service fee starts at 2,000 yuan and can go up to 3,000 yuan.
The group has employed 200 people for the senior care business unit that can serve 100 communities, according to Li.
Although seen as one of the future growth engines, the new line of business is not driven by the profit motive, said Zhang Hai, senior vice-president of Vanke.
Nor is there any plan to go public right away, though potential opportunities to do so abound, said Zhang. "We need to consolidate our business first. We're not doing senior care real estate, but senior care services. The capital market foray will usually lead to short-term behavior, which is definitely not what we want."
China's fast-growing aging population is a huge market for senior care services, he said, citing industry data that the elderly population will reach 260 million in 2020, almost nearing the total population of the United States.
By the end of 2015, those aged 65 and above accounted for 10.5 percent of China's total population of 1.37 billion, surpassing the global average of 8.5 percent.
According to Wu Xiaobo, a financial writer, the senior care industry will become China's biggest industry with over 10 trillion yuan market value in 13 to 15 years, replacing the real estate industry.
"The senior care services are just a part of Vanke's overall property ecosystem," said Zhang. "The senior care subsystem can be mainly divided into three levels. First, to establish the network layout with three major product lines; second, to set up the Dignified Life plus cooperative ecological platform, including cooperating with medical service providers and equipment suppliers; third, to build an extendible ecological service in the future."
