Evergreen – Life Right Retirement Lifestyle2nd Apr 2019
Drawing on its existing position as industry leader in the life right retirement community landscape, and leveraging the new financial muscle it developed in its transaction with PSG, Evergreen is rapidly expanding its retirement village footprint and setting new benchmarks for every aspect of retirement living.
‘Just because it “ain’t broke” is no reason not to make something better,’ says Evergreen’s Brand Marketing Director, Arthur Case.
New structure, new companies
With expansion comes corporate restructure and in January 2019, Evergreen divided into two separate but complementary business services – the property development and asset holding company, Evergreen Property Investments (Pty) Ltd (EPI), under the management of new MD Cobus Bedeker, and Evergreen Lifestyle Villages (ELV), the operating company that runs the estates. ELV’s new MD, Garry Reed, who was previously with Tsogo Sun, has extensive hospitality experience, which will be put to good use in perfecting Evergreen’s lifestyle products.
Bigger and better
Since PSG bought into Evergreen in 2017, the company has been able to expand its property holdings, and also to accelerate its build. As Case says, ‘we realised we need to build scale. Scale allows you to offer a lower purchase price because you are building in economies of scale – and it allows you to keep levies lower.’
So new properties in the pipeline include Evergreen uMhlanga Ridge, which will have 640 units, Evergreen Zimbali Lakes with 750 units, Evergreen Hilton with 500 and, in Port Elizabeth, a planned 800-unit village. And they are expanding existing estates. A hundred and four new homes are nearing completion at Evergreen Noordhoek, which will bring the total to 270 units. Phase One is sold out, and 47 homes are already occupied.
They’ve also bought additional land at the existing estates, and have already added 43 new homes at Muizenberg and 13 at Bergvliet, where an apartment block with 22 luxury apartments is almost complete. And, in Gauteng, Broadacres will soon have 108 new apartments in two separate blocks.
But this expansion is not just for the sake of putting more houses on the ground. It’s in order to effectively and affordably increase the level of care in all of the estates. ‘We are moving on to having all levels of care in all of the estates,’ says Case.
We are driving the notion of continuous care. So in each village you will get independent living, primary healthcare, home-based care, frail care, dementia care, recuperative care and palliative care. Because we sell a life right, we need to be able to cater for our residents until the end of their lives – whatever their needs. The commitment to bigger villages makes investment in large care centres economically viable – we must have continuous care.
The two big existing Evergreen villages, Muizenberg and Broadacres, have world-class 2,000-square-metre care centres that offer the full range of care. Each care centre has a clinic for primary healthcare needs like blood pressure monitoring or wound dressing, and rooms for doctors, physiotherapists and other healthcare professionals.
‘At the moment, there are some care centre residents with mild dementia,’ says Case, ‘but, as this condition is becoming more and more widespread, we’ve realised we have to provide dedicated dementia care centres as well.’
Each care centre has a minimum of 32 beds, as it is just not economically feasible to run a smaller centre. Muizenberg has been approved for sub-acute facilities, and the other centres will be too.
The care centres also have dedicated dining and lounge areas. This, Case explains, is because, while the care aspect of Evergreen villages is paramount, the estates are, first and foremost, lifestyle estates, and Evergreen’s lifestyle culture is about hospitality and fine living – and discreet care.
‘Our strategy,’ he explains, ‘is to create a lifestyle and hospitality culture supported by a comprehensive healthcare model.’ This is why they have brought in one of the top hoteliers in South Africa to head up ELV. ‘Garry will take us to a new level of hospitality,’ Case says. ‘He ran the Lost City, and other top hotels.’
Beyond Cape Town
Having started in Cape Town, the Evergreen brand is quite well known in the Western Cape, but it is rapidly expanding. Evergreen Broadacres is the first village in Gauteng, and there are a slew of new villages planned in KwaZulu-Natal. Evergreen uMhlanga Ridge will open first, with Evergreen Zimbali Lakes close behind, and then Hilton.
‘We have been slowly changing the perception of life right. In the past, life right was considered a bad move investment-wise, but potential residents are starting to realise it’s not a financial investment – it’s a lifestyle investment, a long-term relationship in which the developer is in it for the long run.’ adds Case.
The life right model is designed specifically to address the challenges of ageing. Case outlines ‘four fears’ that many South African seniors share as they age.
The four most common concerns associated with ageing are:
• crime and violence
• outliving your retirement income
• uncertainty about who will take care of you if you’re ill
Evergreen has addressed these four issues directly, focusing on:
• physical security
• financial peace of mind
• continuous care
• sense of community.
The physical security is pretty self-explanatory, and the continuous care has been explained above. The sense of community is an important aspect of retirement estates, so Evergreen puts a lot of thought into the design of the estates and into facilities for active interaction. And all Evergreen estates are pet-friendly, so there is no need to leave furry family members behind.
But it’s in the sphere of financial security that the life right model really shines.
Financial peace of mind
The life right model addresses many of the fears seniors have about outliving their retirement benefits. Firstly, when you buy a life right, you buy into the estate for life. And, unlike with sectional title developments in which the developers hand over the estate to the residents on completion of sales, the life right developer is in it for the long haul. This, explains, Case, is why it is so important to have economies of scale.
‘You need the critical mass to keep levies down,’ he explains.
Our levy model is that we don’t profit from levies. When fully occupied, incoming levies should cover operating costs. Because we are a life right developer, we cannot impose special levies. However, Evergreen shareholders have significant financial muscle and are invested for the long term. Evergreen ensures that all new investment and capital projects in existing villages are funded without looking to residents for special levies.
Levies cover most living expenses but do not include staying in the care centre. This means that retirees who live a long and healthy life and never set a hiking-boot-clad foot in the care centre do not crosssubsidise it.
‘If you need it,’ says Case, ‘you pay for it.’
Now – on the face of it – that sounds scary, but the life right model can handle that as well. ‘We offer some flexibility for emergencies,’ Case says. What this means is that if a resident needs care and can’t afford to pay for it, they can access the capital in their life right. It’s not like an access bond you can use to buy a new motorcycle – it’s just there for care and levies. Single residents who require frail care will usually sell their life right to fund care costs.
The bottom line is that life right is a partnership for life – it’s about peace of mind.