Premium aged-care demand on the rise

The Star

19 hours ago

MBSB Research said the silver economy opens up major opportunities in gerontechnology, senior living, preventive wellness, and financial services.
PETALING JAYA: Malaysia is steadily heading towards an aged nation status.
By 2048, the country could be officially classified as an aged society, with citizens aged 65 and above making up a significant portion of the population.
Current projections estimated that this age group would grow from 8% in 2025 to 18.3% by 2060, underscoring a demographic shift with far-reaching social and economic consequences, said MBSB Research.
According to the research house, the silver economy opens up major opportunities in gerontechnology, senior living, preventive wellness, and financial services.
Government policy is also starting to align with this shift, with frameworks like the 13th Malaysia Plan and the National Ageing Blueprint placing greater focus on long-term care, social protection and age-friendly infrastructure.
Complementing these, private sector players such as Sunway Bhd , UOA Development Bhd and IGB Bhd are moving ahead with premium aged-care and integrated senior living developments, signalling rising demand for high-quality, lifestyle-focused eldercare solutions among the country's growing ageing population.
One notable example is Sunway Sanctuary, a flagship senior living residence launched in 2023 by Sunway Healthcare Group.
The first phase of the development includes 235 out of 473 planned units and according to MBSB Research, occupancy has risen from 30% in 2024 to 50% currently.
The second phase is expected to be launched at a later date.
'Given the positioning of Sunway Sanctuary for premium aged care services in Malaysia, we think that it could be selected for international seniors.
'As such, the occupancy rate of Sunway Sanctuary could be helped by medical tourism in Malaysia.
'We think that seamless access to Sunway Medical Centre or Sunway Sanctuary is one of the key attractions,' said the research house.
It added that the upcoming listing of Sunway Healthcare Group, which is expected by the first half of financial year 2026 (FY26), will remain the near-term catalyst to Sunway.
'Nevertheless, the upside for Sunway's share price is limited. Hence, we maintain a 'neutral' call on the stock and keep the RM5.01 target price unchanged.'
As for UOA, the research house said the property developer is reaping recurring income from its Komune Living and Wellness (KLW) facility in Cheras.
KLW, a joint-venture between UOA and Care Concierge Care Centre Sdn Bhd, was launched in May 2022 with a total cost of RM250mil.
'The occupancy rate of KLW continues to improve from 40% to 50% in financial year 2023 (FY23) to 78% in the first quarter of FY25, which exceeded management expectations.
'KLW is one of the investment properties of UOA which contributed to its recurring income. Note that other income which was made up mainly by income from rental and hospitality contributed to RM383mil in FY24,' said MBSB Research.
Backing its 'buy' call on UOA, the research house said the group's dividend yield is attractive at 5.7%, while its balance sheet is in a net cash position.
Meanwhile, IGB ventured into the silver economy sector in 2022 with the launch of ReU Living, an assisted living operator.
It provides post-surgery recovery to help the recovery journey of individuals in need of post-operative or post-hospitalisation support.
'We gather that occupancy rate is high at near full capacity due to the stay of long-term residents, post-hospitalisation short term guests and day care guests.
'Demand for post-surgery recovery packages is strong as it makes up 40% of guests at ReU Living, while assisted living makes up 60% of guests.'
For now, the target market of ReU Living is primarily locals, but the centre expects a growing interest from foreigners.
Valuation wise, MBSB Research placed a fair value for IGB at RM3.10 based on price-earnings multiple of 9.2 times, pegged to FY26 earnings per share of 33.8 sen.