Retirement Living Starts With the Resident
What investors can learn about a retirement living development by starting with the people who will live there.
A retirement living development must work as a place to live. The investment plan depends on that basic requirement. Before deciding how a building should look, a development team needs to understand the residents it intends to serve and the experience they are seeking.
Retirement living is a distinct kind of real estate investment. The property is a home, and it is also an operating business with services, staff and residents who choose it. That makes the resident experience a practical place to start.
Key takeaways
- A retirement residence combines real estate with a daily service operation, so how it works as a home shapes how it works as an investment.
- Canada’s population aged 65 and older is projected to keep growing as a share of the total.
- The service model sets a project’s staffing, operating and design requirements.
- Monthly pricing is best read together with the service package it covers.
- A property intended for long-term ownership needs a clear reason for residents to choose it and an operating approach that supports that experience.
Why is retirement living a different kind of real estate investment?
Most rental real estate leases space. A retirement residence leases space and delivers services every day. In Ontario, retirement homes are privately owned, and residents pay rent plus fees for any extra services they buy, according to the Ontario government’s overview of care options.
Investing through a real estate investment trust adds one more layer. Unitholders do not own the building directly. Trustees hold title and manage the property on behalf of unitholders, as described in Osler’s overview of REITs in Canada and by l’Autorité des marchés financiers. The investment therefore rests on the property working well as a residence over many years.
Who is a retirement living property built for?
The long-term picture is shaped by demographics. In its 2024 population projections, Statistics Canada reported that people aged 65 and older made up 18.9% of the population in 2023, and projects that share to reach between 21.9% and 32.3% by 2073, depending on the scenario.
Within that group, retirement homes serve a particular resident. The Ontario government describes them as a fit for people who don’t need a lot of outside help but no longer want the workload of managing their own home.
Some prospective residents may value independence with convenient access to meals and housekeeping. Others may place greater importance on social connection, transportation or proximity to family. A defined resident profile shows who the property needs to attract, and it anchors every later decision in the plan.
How does the service model affect the investment plan?
The service model needs to be defined because different levels of support carry different staffing, operating and design requirements.
The Ontario government lists housekeeping, meals, laundry, social and recreational programs and shared dining rooms among the typical features of a retirement home. Each service needs space in the building and people to deliver it. The table below shows how a service choice carries through to the plan.
| Service | What it requires of the building | Where it shows up in the plan |
|---|---|---|
| Meals | A kitchen and a dining room sized for residents | Staffing, food service costs and the monthly price |
| Housekeeping and laundry | Storage, laundry rooms and service access | Staffing schedules and which services are included |
| Social and recreational programs | Lounges and activity rooms | Program staff and shared space in the design |
| Transportation | A drop-off area and vehicle access | Scheduling and how the service is priced |
Because these choices affect both construction and daily operations, a clearly defined service model is one of the first things to look for in a retirement living plan.
What do suites and shared spaces tell an investor?
Suite layouts are part of that experience. So are entrances, outdoor areas and shared spaces. Can residents move around comfortably? Can staff deliver services efficiently? Do common areas give people appealing places to spend time together? Those practical questions deserve attention alongside the architectural concept.
Private rooms or apartments and full wheelchair access are among the typical features the Ontario government lists, so privacy and ease of movement are the baseline residents expect.
These design questions serve two purposes. Comfortable movement and appealing common areas give residents a reason to choose the community. Efficient service delivery supports a workable operation.
How should monthly pricing be read?
Monthly pricing also needs to be considered in relation to the service package. Comparing communities requires an understanding of meals, housekeeping, utilities and any additional services. A room price alone cannot explain the experience a resident is being offered.
Clear pricing is also part of how the sector works. Ontario’s Residents’ Bill of Rights includes the right to know what care services are provided and how much they cost.
In a business plan, the proposed monthly price says the most when it sits next to the services it covers. Together, they describe what residents are choosing and why the property suits them.
What does the operating approach need to deliver?
The operating approach brings the residents, services, design and pricing together day to day. It covers who runs the property, how staff deliver services and how the community is managed over time.
It also has a regulatory side. Homes that meet the definition of a retirement home under Ontario’s Retirement Homes Act, 2010 must hold a licence to operate from the Retirement Homes Regulatory Authority.
The question to ask is whether the proposed operating approach can support the experience the plan describes.
How does the resident experience connect to the business plan?
A business plan explains what a project is meant to be, how it is expected to progress and what has to go right along the way.
For PRG REIT’s retirement living focus, these questions connect the development plan to the eventual operation of the property. A defined resident experience helps guide design decisions and gives the business plan something concrete to test.
What should investors ask about a retirement living project?
Investors should look for that connection. A property intended for long-term ownership needs a clear reason for residents to choose it and an operating approach that can support the proposed experience.
The questions below can help when reviewing any retirement living project. For a broader introduction to real estate as an investment, see Get Smarter About Money’s guide to understanding real estate investments.
FAQ
How is retirement living different from other rental real estate?
A retirement residence provides both housing and ongoing services such as meals, housekeeping and social programs. In Ontario, residents pay rent plus fees for any extra services they buy.
Who licenses retirement homes in Ontario?
The Retirement Homes Regulatory Authority (RHRA) is responsible for licensing retirement homes in Ontario under the Retirement Homes Act, 2010.
Why does the service model matter to investors?
Different levels of support carry different staffing, operating and design requirements. The service model shapes the building, the operating plan and the monthly price.
Do REIT investors own the building directly?
No. Investors hold units in the trust. Trustees hold legal title to the property and manage it on behalf of unitholders.
What types of projects does PRG REIT build?
PRG REIT builds retirement living and commercial projects. The business plan for each offering explains the specific project.
