Opportunities in the Korea senior living sector
Transcript
South Korea has reached a demographic crossroads.
Today, over 20% of its population is over 65, with numbers projected to double by 2050 — marking South Korea as a “super-aged” society.
This surge in the elderly population is creating an unprecedented demand for senior housing and care facilities.
Despite the growing need, South Korea has one of the lowest senior housing penetration rates globally — at less than 1% — compared to 6% in Australia and 11% in the United States. The majority of existing senior care facilities are operated by individual owners.
The severe shortage — in both quantity and quality — of senior living options in Korea is leaving many elderly people without adequate care and accommodation.
Our research also revealed that there are even fewer institutional-quality facilities that cater to seniors in their 70s and 80s who are generally healthy, but may have some mobility issues or non-critical medical conditions.
To address the needs of this growing segment, Invesco embarked on a journey to develop high-quality and thoughtfully designed senior living properties.
As part of this process, we quickly recognized the importance of partnering with an experienced operator that shared our vision to grow with scale, quality, and impact.
Given the highly fragmented nature of the senior care industry, Invesco founded Care Operation — a platform established through a joint venture partnership with Caredoc to directly service the senior living properties within our portfolio.
We chose to partner with Caredoc, one of the top senior care service platform in Korea, due to its vast network and access to caregivers, hospitals, and related facilities nationwide.
Our vision for Care Operation is to create nurturing communities where seniors who value independence and connection feel safe and supported. A place designed with residents in mind, and able to cater to evolving needs.
Wide hallways, step-free access, and age-friendly amenities are all built in to ensure comfort and accessibility.
Around-the-clock on-site caregivers and nurses support daily needs, while responding to any emergencies, providing peace of mind to residents and their families.
Regular health check-ups and preventive care programs — including fitness classes and yoga promote healthy living.
While leisure activities such as art workshops, community gardening, cultural events, and group excursions enhance the community spirit, supporting residents’ physical and social well-being.
Dietary specialists offer residents nutritious meal plans tailored to their individual needs, which residents can enjoy in the privacy of their rooms or in communal dining areas.
Photos of daily activities are also shared with residents’ families, to help families stay connected and give them assurance that their loved ones are healthy, happy and well taken care of.
And 24/7 security, emergency call systems, and manned entry points, ensure residents' safety at all times.
We are committed to meeting the needs of today’s seniors, while building a sustainable model for future generations.
This is more than an investment; it’s a commitment to enhancing the quality of life for South Korea’s aging population and setting an example for other markets facing similar demographic challenges.
Our investment in South Korean senior living is not just addressing a critical societal infrastructure need — we’re building the future we’d want for our grandparents, our parents — and eventually, for ourselves.
Korea Senior Living and Care Operation
South Korea is aging rapidly, with over 20% of its population now over 65 — a figure set to double by 2050. Yet, senior housing remains underdeveloped, with less than 1% penetration. In this video, Gideon Lee, Head of Acquisitions, Asia Pacific explores the need for quality elder care and how Invesco and Caredoc are stepping in to reshape the future of senior living.
Quick take: Opportunities in the Korea senior living sector ft. Catherine Chen
Transcript
South Korea is undergoing a significant demographic shift. By 2025, it will officially become a “super-aged” society, with more than 20% of its population aged 65 and older.3 This rapid aging trend is creating a growing demand for senior living solutions.
However, the current market is underdeveloped. Senior housing in South Korea has a penetration rate of just 0.6%—one of the lowest globally—compared to over 11% in the United States.5 The market is fragmented, most facilities are small-scale, and lack the quality and consistency seen in the more mature markets. This presents a compelling opportunity for institutional investors.
The senior living sector in South Korea is still in its early stages, but it is gaining momentum. Across the broader Asia-Pacific region, the “living sector”—which includes senior housing, student accommodation, and co-living—is increasingly viewed as a resilient asset class with strong long-term fundamentals.
Government policy is also supportive. South Korea is encouraging private sector participation through deregulation, tax incentives, and programs that help seniors transition from homeownership to more suitable living arrangements.
Importantly, the expectations of the aging population are evolving. The Baby Boomer generation is seeking more than just care—they want lifestyle, community, and wellness. This shift is driving demand for modern, service-oriented senior living environments that combine healthcare with hospitality.
The growth of senior living facilities in South Korea depends on operational expertise and access to a strong caregiver network. Skilled management and high-quality care are key to attracting residents. Operators with proven experience are well-positioned to seize market opportunities, particularly in Seoul and Gyeonggi province, where demand is expected to be highest.
In summary, South Korea’s senior living sector offers a rare combination of demographic tailwinds, limited existing supply, and supportive policy. For investors, it represents a timely and strategic opportunity to enter a market poised for long-term growth.
Important information
This document is intended only for Professional Investors in Hong Kong, for Institutional Investors and/or Accredited Investors in Singapore, for certain specific sovereign wealth funds and/or Qualified Domestic Institutional Investors approved by local regulators only in the People’s Republic of China, for certain specific Qualified Institutions and/or Sophisticated Investors only in Taiwan, for Qualified Professional Investors in Korea, for certain specific institutional investors in Brunei, for Qualified Institutional Investors and/or certain specific institutional investors in Thailand, for certain specific institutional investors in Malaysia upon request, for certain specific institutional investors in Indonesia and for qualified buyers in Philippines for informational purposes only. This document is not an offering of a financial product and should not be distributed to retail clients who are resident in jurisdiction where its distribution is not authorized or is unlawful. Circulation, disclosure, or dissemination of all or any part of this document to any unauthorized person is prohibited.
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APAC’s living sector is drawing investor interest
The living sector in APAC, including South Korea, is drawing significant investor interest. According to CBRE, this sector, which encompasses senior living, student housing, co-living, and serviced apartments, is poised for growth due to rising expatriate numbers, low homeownership affordability, and its appeal as an inflation hedge.1 While APAC’s living sector is still in its early stages, accounting for only 6% of commercial real estate investment volumes since 2019, compared to 27% in Europe and 44% in the US, there is vast potential for growth.2 Japan and Australia lead the region in terms of living sector investment volumes, but South Korea is also gaining attention, particularly for senior housing.
Growing demand from an aging population
South Korea has one of the fastest aging populations in the world. By 2025, it is expected to become a "super-aged society," with over 20% of the population being 65 years or older.3 This rapid demographic shift is creating a substantial demand for senior housing solutions which is still in its early stages. South Korea’s population aged 65 and older is projected to double by 2040.4 As the Baby Boomer generation ages, their lifestyle preferences are evolving, further increasing the need for diverse and specialized senior living options.
Limited supply and fragmented industry
Despite the growing demand, South Korea has one of the lowest senior housing penetration rates globally, at just 0.6%, compared to over 11% in the United States.5 The industry is highly fragmented, with individual operators making up the majority.6 It is characterized by a mix of privately funded senior housing and welfare houses for seniors, offering various levels of services and care. This fragmentation presents a significant opportunity for consolidation and the introduction of more standardized, high-quality senior living facilities. The limited supply of senior housing underscores the urgent need for new developments to meet the rising demand.
Policy support and deregulation
The South Korean government is actively supporting the senior living sector through various policy measures and deregulation efforts. These initiatives aim to boost supply and encourage private sector participation. Key policy supports7 include:
- Deregulation for developers and operators: The government has relaxed regulations to make it easier for developers and operators to enter the market and expand their offerings.
- Incentives for elderly residents: The government is providing incentives for elderly individuals to move into senior housing, such as annuities for the sale of existing residences.
- Encouraging private investment: Policies are in place to encourage private sector investment, including tax-efficient structures such as Real Estate Investment Trusts (REITs).
These policy measures are designed to facilitate the growth of the senior housing sector and ensure that it can meet the needs of the aging population.
Success is dependent on operational expertise
The scalability and success of senior living facilities in South Korea are heavily reliant on operational expertise and access to a nationwide caregiver network. Effective management and high-quality care services are crucial for attracting and retaining residents.8 Operators with established expertise and robust caregiver networks are well-positioned to capitalize on the growing market. We are positive on senior living housing opportunities in the Seoul metropolitan area and Gyeonggi province more broadly, where the demand we believe would be the highest.
Conclusion
The senior living real estate sector in South Korea presents a relatively compelling investment opportunity driven by a rapidly aging population, limited supply, supportive government policies, and the need for operational expertise. By focusing on derisked products for independent seniors and leveraging policy support, investors can consider tapping into this growing market and contribute to the development of high-quality senior living solutions. As the industry evolves, there would be significant potential for growth and consolidation, making it an attractive sector for long-term investment.
With contributions from Monica Uttam, Thought Leadership and Insights, Asia Pacific
Investment risks
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.
