Affordable Retirement

Oak Tree Retirement Villages

In the later years of life, there comes a time when a lifestyle change must be made. The reason for this change may be different for each person; it could be a health problem, the inability to maintain a large home, or it could be to fulfil other needs, such as companionship or security. Yet even with these diverse needs, many retirement homes are expensive and luxurious, targeting the highest income bracket and remaining out of reach for many Australians.

Oak Tree Retirement Villages are the exception. By presenting high quality retirement homes (or villas) at lower rates, Oak Tree has become the leading provider of affordable retirement homes. The reason Oak Tree is able to provide such affordable homes is because it comprises smaller villages requiring less maintenance. In fact, the Oak Tree group website proudly describes a self-contained, independent, one bedroom home for $105,000.

In the beginning, the company started out with an interest in property in Australia, originally looking in the childcare industry. When it was recognised that the industry was beginning to saturate at an alarming rate, new options were examined. Considering the unprecedented aging of the population that is occurring, and that the federal government is largely not involved in the development of new facilities for senior Australians, retirement homes became a clear option.

The next step was to undertake a two year research program to ascertain exactly what part of the market to target, including what price point to provide the villas for, what sort of villas, the design and parameters, and a whole range of other criteria to determine how to position the business. The research included driving to existing facilities around the country, getting a clear picture of what would work for Oak Tree. In late 2003 the company began acquiring land, and by 2006, construction on the villages was underway.

The main difference between Oak Tree Retirement Village and its competitors is that the villages are smaller. Typically, a new village for a large corporate group in Australia would boast a minimum of 150 villas, but Oak Tree Villages range in size from 40 to 80 units maximum. In some ways these villages are considered to be cosier and more intimate, as opposed to the large expanses of residential villas. While large villages certainly have their place, Oak Tree believes that their operational, day to day running can be problematic. According to General Manager, Mark Bindon, Oak Tree Villages’ manageable size enables the company to operate very efficiently, and to offer customers entry to the retirement living marketplace at a reasonable price point.

There is, to be sure, a lot of money involved when building retirement villages. The bigger corporate groups with big money traditionally target the higher end of the market because they have the resources to build product which is a lot more expensive. Oak Tree saw the opportunity in the market to provide affordable, high quality accommodation, particularly in the regional areas where the corporate activity is much lower. It was a matter of where the greatest demand was, which was in the regional areas from the middle income bracket and down, as opposed to the metropolitan areas from the middle income bracket and up.

Accordingly, Oak Tree Villages’ brand awareness is positioned within regional catchments. Oak Tree goes to great lengths to engage with the local community, which has proven to be the best way to generate brand awareness outside of the traditional marketing activities of print media, television and radio. Engaging with the community through morning teas and events in the village makes the village a place of public access; it allows people to come in and socialise with others, and to get a feeling for what Oak Tree is trying to achieve.

What Oak Tree is trying to achieve is a sense of community. Every Oak Tree retirement village is unique; one has a river, and hosts fishing contests. Another activity to partake in is happy hour, which is common to all the villages on Friday afternoon. It is an opportunity to socialise, have a drink or play a game. During the week, even retired people are often busy with other things, whether it is travelling, volunteer work or shopping, and happy hour once a week is a welcome opportunity for the residents to regroup and relax. It is an optional activity, but typically, more than 90 per cent of the residents take part.

There are approximately 40 employees of Oak Tree, including the staff at the villages, and that number is expected to grow to about 60 employees within a year. Currently, there are 17 Oak Tree locations with plans to add eight to ten sites over the next six to twelve months. When hiring employees, Mark Bindon explains that Oak Tree is looking for the willingness to be involved at the village level – “Regardless of what position you hold, whether you’re an accountant or someone who’s involved in the construction side, all of our staff attend our marketing events at the village. You’ll see head office staff coming out and getting involved in the village, rather than just in head office.” Ideal employees are people who desire to be involved out in the field, which might involve weekend work and travel.

Indeed, employees of Oak Tree Retirement Villages have always taken a hands-on approach. There are no third parties used for any activities; all the people who operate a village are directly employed, with sales and marketing, legal, even design and construction all conducted in-house. This means that Oak Tree has a very unique, specific approach to all aspects of its villages. It also means that lessons are learned quickly about what works and what does not work, and since everything is in-house, decisions can be made and changes can be implemented very quickly.

Even the Oak Tree Newsletter reflects this model. Designed to be about the specific village rather than a corporate style production, it is written by the village manager and the residents of that village rather than something that is sent out from head office. It is a good representation of what is going on in each village, and people in the village can connect through the various components of the newsletter. It is also good for the residents of other villages to see what other activities are available elsewhere.

Many retirement villages do not permit pets in the resident’s homes, however Oak Tree allows pets and always has. One of the reasons they allow it is that many residents are single, sometimes after losing a partner, and in many instances their only companion is their pet; Oak Tree does not believe that this bond should be broken. When joining the village, the relationship is instead fostered and encouraged, which is the way it has always been with Oak Tree, and there have been very few, if any, problems with pets.

The next objective for Oak Tree Retirement Villages is to grow the business to 25 villages, creating room for 1100 to 1200 residents in total. This would go a long way toward providing affordable accommodation in many regional areas on the eastern seaboard of Australia, since these areas are currently underserviced. As opportunities present themselves, the company will continue to grow more broadly, with additional villages in certain regional cities. In the long term, evaluations of the current industry will be undertaken. It is a logical step, Mr Bindon suggests, for the company to consider aged care, since it is similar to the services it presently provides.

In the near term, a lot of work and practice goes into making sure that each resident is content at Oak Tree. Villages need to be well presented, well managed, and there must be a clear line of communication between the residents and the Oak Tree group. According to Mr Bindon, “If you were to speak directly to our resident audience, most people would say that they’re very happy living in the villages, and one thing we’ve learned from the early villages is that it’s very much a lifestyle choice that people have made. Therefore, beyond the product, the villages need to be enjoyable places to live.”

Oak Tree has made a conscious effort to remain unchanged in its principles. The brand position of affordable villas has not changed, Oak Tree remains in the regional locations that are believed to be in great need, and the staff structure has not been unnecessarily complicated. Most of the people who work there have been there since the first day. All of these elements make Oak Tree what it is – the provider of beautiful places to comfortably retire, which the average senior Australian can afford.

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December 19, 2018, 5:31 PM AEDT