The Architect's opinion: aged care

It was interesting and rewarding to attend this years’ ACQ conference at the Gold Coast and listen to what’s coming up for the aged care sector in the near future. The recommendations from the Productivity Commission were particularly exciting and if the stakeholders can keep a united front on the needs for the industry, we may get the reform the industry needs.

In my view we are in a crazy situation where there is little or no residential aged care under construction with the building industry at its most competitive since the early 1990s after the last great ‘crash’. There is clearly a need for more aged care accommodation, but the current structures make the proposition unattractive at present, with many of the big providers ‘sitting on their hands’ awaiting a more attractive model to come forward from the government.

Yes I’ve heard the arguments about the new batch of ‘baby boomers’ wanting to stay home…..not sure I would even get my 80-year-old father into a facility!!! If he goes he’ll end up going straight into a high care place kicking and screaming!! But there is always going to be a need at the high-care / palliative care end and at present there is not much action on this front. We have just a 144-bed aged care facility at Chermside for the Wesley Mission Brisbane but that’s the last one on the books for a while.

A big opportunity exists out there in the industry for those who like to gamble on a better outcome from the Feds. Let’s assume the aged care industry does stay united and the government does get through the reforms on a bipartisan basis….what then?

I would imagine we will again see a big uptake of bed licences (if that’s what they get called) and that capital will be finally available. This could mean a rush by the sector to get back into building and we will see the typical problems that arise with over-demand, escalating prices etc. etc.

For those aged care providers who are keen to upgrade / refurbish or take a gamble and build new stock then the reward could be there! The opportunity to build this ‘cheap’ will not last with the mining sector booming and the agricultural sector set to return to good times (this rain has been fantastic!).

At present we have a ‘flood’ of builders interested in tendering on our works with something like 30 or more Expressions of Interest received for a minor project worth between one and two million dollars. Tender results for our clients are also fantastic! It’s a buyer’s market – but, the window won’t be open for that long and if you jump through early you could be ahead of a big pack trying to squeeze under that rapidly lowering pane of glass!

That’s a ‘glass half full’ assessment but as we all know in life, anything can happen. What I do know for a fact is that builders and consultants are in oversupply and pricing has been the best it’s been for about 20 years. It’s a buyer’s market!

Written by Paul Trotter Director of Fulton Trotter Architects. The article was featured in the Autumn Edition of ACQwire 2011 by Aged Care Queensland.