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From Our Correspondent: A Club for
Evergreens
Asians can retire in style too
By: Allen T. Cheng
Asiaweek, July 19, 2000
Hong Kong has
800,000 people who are over the age of 65, and it's about time that a
company is finally taking a serious crack at catering to their needs.
Property developer China Rich Holdings recently launched the Evergreen
Club, a semi--luxury retirement villa catering to senior citizens of
China's special administrative region. The company just completed a
1,200--unit retirement complex in the city of Shunde in southern Guangdong
province, about a two--hour boat ride from Hong Kong. The retirement
community is the heart of the Evergreen Club, which also includes
membership in an 18--hole golf course, a clubhouse and a hospital in
nearby Guangzhou.
For
a Gold membership fee of $52,000, anyone over the age of 65 and with
reasonably good health can retire to Shunde and not have to worry about
paying rent or buying groceries for the rest of his or her life. The
membership fee also includes getting discounted medical care for life.
Sounds too good to be true? Not if you ask Robert Yip, chairman of China
Rich Holdings. The entire investment cost only $52 million, says Yip, and
he is confident that he will be able to sell all 1,200 units and earn a
tidy $10--million profit on the project because the unit sales should
generate $62 million in revenues. "Hong Kong's population is getting
older and it is because of this that we invested in the Evergreen
Club," says Yip.
Retirement communities may be common in the United States and in Europe,
but the Evergreen Club could be the first of its kind in Asia. Chinese
families traditionally like to take care of their elderly, but the rapid
pace of social and economic change that has hit the region makes it
difficult for young families to take care of both their children and their
parents. This is combined with the fact that most urban Asians today live
in small apartments, making it hard for a large family to live under one
roof. As a result, more and more elderly people are forced apart from
their children. So why not build a retirement community for them, reasoned
Yip, who lived in Canada for more than a decade in the 1980s and early
1990s. "The entire world's aging--population problem is
significant," he says. "In Hong Kong, the aging population
[those over 65] is growing at 1% a year."
To make it easier for retirees to participate, Yip has signed on Wing Hang
Bank to give loans to those who can't afford to pay the $52,000 in one
lump sum. "To put up one parent, it costs three or four children only
HK$3,000 a month each for three or four years," says Yip, "and
this is affordable for most working Hong Kong professionals." The
Evergreen Club villa in Shunde is fully staffed with trained nurses and
doctors as well as physiotherapists. Their salaries cost very little in
Hong Kong terms, and that's why the club can afford to subsidize all
medical care for its members.
Retirees who choose not to reside full--time have two other options:
silver membership, which costs $4,500 and allows them to live for 90 days
a year at the club for three years, and a normal membership, which for
$1,100 a year permits them to use the club at a 50% discount off daily
rates. "Shunde is one of the most beautiful places in Guangdong and
it is just a short boat ride from Hong Kong," says Yip, whose
long--term plan is to build other retirement villas in China -- including
in Fuzhou, Suzhou, Shanghai and Beijing -- as well as in other parts of
Asia with large ethnic--Chinese communities. "We are really targeting
the aging overseas Chinese community," he says. "Many have
worked hard and saved enough money to retire in style, just like their
counterparts in the U.S. or in Europe."
Whether retiring Asians flock to other Evergreen clubs will depend on
Yip's management of the first project and whether it delivers on its
promise of quality. But his idea seems sound. Asians are aging, and smart
entrepreneurs will do well to cater to the affluent among them. If wealthy
Americans can retire to Florida and Europeans to the coast of Spain, why
shouldn't retiring Asians want to flock to their favorite destinations
too? Getting old doesn't mean having to be bored, with little to do but
look after grandchildren. It's high time Asians begin retiring in style.
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