Industry Spotlight: Vertical Villages – a way forward?Vertical retirement villages are the obvious solution to rising land prices in inner and middle ring suburbs for senior Australians seeking age-appropriate housing. The problem lies in the ability of operators to develop these assets, notwithstanding the difficulty in competing with residential developers for available sites.Vertical retirement villages are a well-established asset on the Australian landscape, particularly in New South Wales. Obvious examples in Sydney include Dougherty Apartments in Chatswood which was developed in 1989 in a tripartite agreement between Willoughby City Council, NSW Housing and Uniting Church Aged Care. This is a 9 story building with 1 units.Another 9 story Sydney village is Goodwin Village in Woollahra operated by ARV Villages which is currently undergoing refurbishment. Outside Sydney Illawarra Retirement Trust has both Diment Towers with 11 stories and 52 units plus Howard Court with 8 stories 77 units.A feature of all these is that they are all operated by not for profits and are over two decades old. For profit operators have more recently developed a vertical village in Adelaide with Living Choice’s Fullarton. This village on a previously derelict site faced planning difficulties in the approval process. Originally 111 units were approved by Unley Council in 2006 and in 2008 Living Choice proposed increasing this number to 189 (later amended to 142) which was approved in 2010. This was then subject to a court challenge which further delayed development.This highlights the difficulties associated with developing vertical villages. Obtaining planning approval and dealing with resident objections takes considerable time (and money). Any operator has to factor years for this stage into their financial analysis. Plus vertical villages cannot be developed in stages therefore they require a developer and/or financier with much deeper pockets to fund these initial costs.
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