Research reveals retirement villages can take decades to be profitable

A Grant Thornton New Zealand study has looked at the development of rural villas in Canterbury and urban apartments in Auckland, over 25 years.

It shows it takes more than 21 years for an owner of a rural villa complex to recover their investment - and more than 25 years for urban-style apartments.

Both sites have strong early cash-flows from initial residents, but declines sharply between seven-and-a-half to 10-years, because of operational and refurbishment costs.