Can wellness real estate energise the property industry?
Contributed by Alan Poon
alanpoon.official@gmail.com
This year was supposed to be Visit Malaysia Year. Despite all the planned programmes and targets set by the Ministry of Tourism, no one would have imagined the string of events that would derail this plan.
So how can the nation lure these tourists back or increase the footfall, once things normalised a few months down the road?
The answer could be in the wellness real estate sub-sector (See part 1 of the Rise of the wellness real estate market at URL: https://www.starproperty.my/news/117212/rise-of-the-wellness-real-estate-market-part-1). This term might still be new to many in the property investors but not with the stakeholders of the wellness industry. Do not confuse wellness real estate with hotel business, providing just the conventional spa or massage centres.
Neither it is medical tourism where foreigners visit Malaysia seeking medical therapies in hospitals, which Malaysia is most known for in the Asean region. As a matter of fact, wellness focusses more on preventive healthcare, whereas medical treatments are sought to cure certain illness or diseases. Hence the adage, prevention is better than cure.
According to the Global Wellness Institute (GWI), a recognised non-profit organisation and the leading source for authoritative wellness industry research, wellness real estate is defined as the construction of residential and commercial or institutional properties that incorporate intentional wellness elements in their design, materials, and buildings as well as their amenities and services.
This sub-sector of real estate was already making headwinds as the hottest topic recently in GWI Summit.
This new venue is still vaguely understood by many in the real estate fraternity in Malaysia whether they are developers or investment company.
A new trend is on the rise.
New trend
GWI defines wellness as the active pursuit of activities, choices and lifestyles that lead to a state of holistic health. Real estate has a crucial role to play in providing individuals and communities with homes and venues to live healthier and longer lives. With wellness real estate, it caters to the needs of an ageing population as well as to combat epidemics that affect humanity globally.
Wellness real estate is born of such evolution. This trend originated from developed nations and today, many of these countries are building real estate developments incorporating wellness as the core of their projects.
Malaysia could capitalise on the existing overhang supply and unlock the potential of these assets into a need-based proposition which does not depend mainly on tourism in good or bad times. There are currently more than 740 wellness real estate projects globally across 34 countries that are either already built or in the construction phase. And the trend is growing. The wellness real estate industry is projected to grow by 6% annually, reaching US$180bil by 2022.
The prospects are endless and Malaysia should hop on this bandwagon due to its favourable location and climate, which is perfect for a wellness retreat destination of choice.
The wellness industry can be very lucrative when targetted at the ultra rich.
A new norm
With both the proven brick and mortar yield from real estate and the wellness economy showing huge prospects and demands for years to come, it makes a lot of sense for both of these industries to converge. Those who capitalise on this game-changing industry will be the first to reap the advantages. As more property developers and building owners shift to build or convert their respective assets, be it a piece of land or existing buildings, into integrated wellness hubs, this would inevitably give rise to another asset class of properties.
The wellness real estate can mean lucrative business models, for example, those who cater to the needs of the super-rich and ultra-high net worth individuals.
A positive impact of the Covid-19 outbreak is that wellness cannot be taken for granted, and the importance of keeping healthy is now even more critical. Just as the proven hospitality industry is slowly converging, as seen from the hotel and short-stay accommodation landscape, despite these two being at loggerheads, eventually both parties need to co-exist to solve a bigger problem in the market together.
It is always better to collaborate rather than competing when there is a long-term win-win situation rather than short-term profits.
Working together has more benefits in the long run.
A reset
The Covid-19 global crisis has brought many economies to its knees, but it could be a blessing in disguise as there is only one direction looking forward, which can only be better.
A reset has begun for a better and brighter Malaysia. It is up to the people as a nation to rise to the occasion.
SuperiorWealth Resources Sdn Bhd founder and CEO Dr Alan Poon is an award-winning international speaker, entrepreneur and author of the three “Good Tenant, Great Tenant” books series on tenant management.
Disclaimer
This article is intended to convey general information only. It does not constitute advice for your specific needs. This article cannot disclose all of the risks and other factors necessary to evaluate a particular situation.
Any interested party should study each situation carefully. You should seek and obtain independent professional advice for your specific needs and situation.
