RETIRED professor Chen Chongyu and his wife Liu Zhenjuan dreamed of coming back to China from their daughter s home in France, but until last year the couple had nowhere to go.
That changed when they found Cherish-Yearn, an upscale retirement community on the fringes of Shanghai and a pioneer in catering to China s prosperous elderly.
Businesses are just starting to tap the rapidly expanding senior citizens market China s new silver industry.
Every year we would come back to China, and we would visit retirement homes. But we couldn t find anything, said 79-year-old Chen, a history professor who specialized in the French revolution. When we finally found this place we felt we could return.
China s traditional model of children living with their elderly parents is under siege, thanks to 30 years of the one-child policy and rapid urban migration.
Leaving their daughter s home in France, Liu, 74, and Chen paid 690,000 yuan (US$104,545) to move into a three-room apartment on Cherish-Yearn s campus.
An annual fee of 88,000 yuan covers basic medical and cleaning services, and various activities.
China had 169 million people over 60 by the end of 2009, or 12 percent of the population. That number will jump to 250 million people by 2025.
And their spending power is rising. Chinese senior citizens command about 300 billion to 400 billion yuan in annual disposable income, according to Kunal Sinha, chief knowledge officer at marketing firm Ogilvy & Mather in Shanghai.
That will rise to 5 trillion yuan over the next three decades.
The whole marketing world is obsessed with young people. The reality for China, the demographic change, is that in 15 years time, the number of young people is going to halve, it s going to be 50 percent of what it is today, Sinha said. The number of senior people is only going to double.
Hypermarkets in China s megacities have caught on to the fact that senior citizens are the main grocery shoppers in the family, sending morning buses and offering discounts to lure them in.
But apart from health supplement makers, few other industries in China are working to earn their silver dollars.
Still, in recent years there s been a sudden pick up in investment in senior homes and so-called silver towns.
Yoko Marikawa, a Japanese consultant specializing in the seniors industry, says nearly 50 of her Chinese clients have launched or were planning to launch retirement communities across China with total investments expected to be between 15-25 billion yuan.
French catering and hotel firm Sodexo was in talks with the Chinese Government for similar services, an executive said.
But most foreign firms and funds are still waiting for the government to issue standards for facilities and services.
Investors still don t know which standards are good. If they invest in the facility now and later the government announces some other standard, they re all out. They would have to rebuild or change some facilities, Marikawa said.
The main risk is that we are still a little early. The parents of the first children of the one-child policy will reach 70 in about five years, said Xi, adding that the international average age for people in retirement homes was 71.5 years.
A steady inflow of cash from these homes for the elderly was a much more attractive business model than straight out property development deals, especially as new restrictions made land and funding harder to find, said Xi, who started out in traditional real estate.
China s biggest property developer, Vanke, is also launching four retirement projects, including one in Beijing.
In many of the older Vanke developments, about 30 percent of the residents are elders living alone empty nesters. So we re looking into different ways of meeting their needs, said chairman Wang Shi, who himself is 59 and an active mountaineer.(SD-Agencies)
Retirement homes and communities could foster other businesses for seniors. Already at Cherish-Yearn, American firm Aramark handles the cleaning, French firm Sodexo runs the canteen, and Hong Kong s Mega Fit operates the gym.
