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From metro luxury to Tier-2 cities, senior living market is evolving beyond one-size-fits-all approach: Report
Senior living is moving beyond one-size-fits-all, with metros focused on luxury and Tier-2 cities on affordability, healthcare and hospitality
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The senior living sector is moving beyond a one-size-fits-all model, with Tier-1 and Tier-2 cities catering to distinct consumer segments and presenting varied opportunities for developers and operators. The sector is at an inflection point, transitioning from a real estate-led model to a broader longevity ecosystem integrating housing, healthcare, hospitality and community building, a report said on September 23.
With India’s population aged 60 and above projected to rise from nearly 149 million (10.5% of the total population) in 2022 to 347 million (20.8%) by 2050, growing at a CAGR of approximately 3%, the senior living housing opportunity is significant, according to a report by Colliers India in association with Primus Senior Living.
Tier-1 cities are best suited for luxury senior living, where high land costs and demand from high-net-worth individuals (HNIs), affluent retirees, former CXOs and NRI parents support premium offerings. These buyers are less price-sensitive when it comes to healthcare, convenience, and quality of life, and are backed by substantial retirement reserves, the report noted.
The service model in metros is characterised by high capital and operating expenditure and combines five-star hospitality with clinical excellence. Offerings may include concierge services, valet parking, fine dining with personalised geriatric nutrition, smart-home automation and dedicated 24/7 ICU stabilisation bays, the report, titled The Future of Ageing and Longevity Economy in India, 2026, noted.
Tier-2 cities, on the other hand, offer advantages such as lower land costs, access to quality tertiary healthcare, moderate climates and less congestion. The target segment includes upper-middle-class households, successful local professionals and seniors returning to their hometowns after living in larger metros, the report observed.
These consumers seek premium senior living but remain mindful of long-term cash flows, making affordability and value important considerations, according to the report.
Over the past few years, seniors and their families have shown a growing preference for aspirational, wellness-oriented and community-led living, supported by higher purchasing power and greater awareness. Developers and senior living operators have recognised this shift and are adapting their business models and service offerings to meet the needs of both Tier 1 and Tier-2 city markets, the report noted.
“India’s senior living story is moving from necessity to aspiration. Today’s seniors and their families are looking beyond just a home; they want community, dignity and an active, purposeful life,” said Adarsh Narahari, founder and Managing Director, Primus Senior Living.
“Senior living in India is at an inflection point similar to what organised retail or co-living saw a decade ago. For investors and developers, the opportunity is significant, but it demands a fundamentally different underwriting approach — one that prioritises micro-market readiness, operating capability and long-term trust over land economics and development margins,” said Digbijay Das, Senior Director, Valuation, Advisory Services, Colliers India.
Colliers India expects participation from branded and listed developers to accelerate across both Tier-1 and Tier-2 markets. These markets can support a range of senior living formats, from active retirement communities and assisted living to higher-care facilities, the report noted.
Commenting on high-end luxury offerings for senior citizens, Aakash Ohri, MD and CBO, DLF, said, “As life expectancy rises and healthcare advances, a growing segment of the population is embracing a longer, healthier and more active phase of life. Financially empowered, digitally connected and deeply engaged with the world around them, they are redefining what this stage of life looks like. Their aspirations extend far beyond comfort and care. They seek purpose, connection, independence and the freedom to continue living life on their own terms.”
DLF is expected to launch its luxury senior living project in Sector 63, Gurugram, with an estimated sales potential of around ₹2,000 crore.
Tier-2 cities with senior living potential
Colliers India identifies Coimbatore, Kochi, Mysuru and Visakhapatnam in the south, and Jaipur, Chandigarh, Mohali, Panchkula and Dehradun in the north as promising Tier-2 markets for senior living. Other potential destinations include Goa, Bhubaneswar, Siliguri, Guwahati, Indore and Nagpur.
These cities combine relatively lower living costs with strong healthcare ecosystems, good air connectivity, established social infrastructure and a more relaxed lifestyle, the report noted.
Demand is being driven by ageing demographics, migration of children to metros and overseas, greater financial independence among seniors, smaller family structures and a growing preference for community-based living with healthcare support.
Buyers in Tier-2 cities are more value-conscious
With India’s senior living market estimated at $12 billion, developers cannot adopt a one-size-fits-all approach, given the wide variations in land costs, healthcare infrastructure and purchasing power across cities, the report noted.
The report notes that Tier-2 cities offer a combination of wellness destinations and asset arbitrage. Lower land costs, access to tertiary healthcare, moderate climates and less congestion make these markets suitable for senior living. The target segment includes upper-middle-class households, successful local professionals, and seniors looking to return to their hometowns after living in metro areas.
Such buyers seek premium living but remain conscious of long-term cash flows. The service model typically involves moderate capex and moderate-to-high opex, with a focus on active ageing through health clubs, preventive wellness programmes and tie-ups with leading multispecialty hospitals, according to Colliers India.
"Buyers in Tier-2 cities tend to be more value-conscious and often have stronger emotional ties to their hometowns or regional culture. Whereas buyers in metros tend to prioritise lifestyle amenities, superior quality and quick access to healthcare needs managed by professional service staff,” Digbijay Das told Hindustan Times Real Estate.
Affordability varies significantly across locations and buyer segments. However, in most Tier-2 cities, the mass-premium demand sweet spot is likely to be for units priced meaningfully below comparable Tier-1 senior living communities, while remaining affordable for financially independent retirees and NRI-linked families.
“Buyers are increasingly evaluating the total cost of living, including healthcare, maintenance, wellness and care services, rather than the real estate cost alone. Hence, the project price must align the hardware (real estate) and software (service offering),” Das said.
Does senior living differ from conventional residential real estate as an investment?
The investment thesis for senior living also differs from conventional residential real estate. Long-term value is driven by occupancy stability, recurring service revenues and operational brand strength rather than development margins alone.
“Investors should view the asset class as a long-duration operating platform rather than a short-term real estate play,” Das explained.
Demand from NRI families and children living in other cities
According to Adarsh Narahari, demand for senior living projects in Tier-2 cities differs from that in metros.
“In Bengaluru or Mumbai, a lot of our residents are seniors moving because their own children have moved away for work, often abroad. In Tier-2 markets, what we're seeing is almost the reverse: it's NRI families, or children settled in metros, who want a safe, well-run home for parents back in the city they originally come from.”
He said the buyer is often an adult child living elsewhere who researches the options and pays for the accommodation. “They want to know someone is watching over their parents when they can't be there themselves; healthcare response time matters more to them than amenities on a brochure.”
Also Read: Why Delhi-NCR’s rich are checking into 5-star branded residences
Primus Senior Living currently operates in Tier-1 cities including Bengaluru, Mumbai, Pune, Chennai and Hyderabad. “Tier-2 is absolutely on our radar; the demand signals are there,” Narahari said. “When we do move into Tier-2, it won't be a scaled-down version of what we've built in metros; it'll be designed around what those specific markets actually need.”
Rishabh Periwal, Senior Vice President, Pioneer Urban, said Tier-1 hubs such as Gurugram are seeing premium senior living projects, with major players launching luxury, service-led communities for affluent seniors. Meanwhile, Tier-2 cities such as Vrindavan, Coimbatore, Dehradun and Varanasi offer opportunities because of lower land costs and improving healthcare infrastructure.
“Our enquiries are largely coming from individuals in the 50-65 age bracket, including couples as well as seniors whose children live in other cities or overseas,” said Anil Godara, Managing Director, J Estates. “The key motivations are access to a secure, socially engaging community, wellness and preventive healthcare, hospitality-led services, and the reassurance of professional support when required.”
Ankur Gupta, JMD, Ashiana Housing, said the senior living sector is moving beyond traditional notions of housing and retirement towards environments that enable people to lead active, independent lives while providing access to support and care as their needs evolve.
“Senior living is no longer confined to a specific age or life stage; rather, it is about the ability to live well throughout the journey of ageing,” Gupta said.
Key challenges in developing senior living projects in Tier-2 cities
The biggest challenge in developing senior living projects in Tier-2 cities is not land acquisition but the creation of a sustainable operating ecosystem. Many Tier-2 cities still face gaps in specialised geriatric healthcare, emergency care integration and the availability of trained caregiving staff. Recruiting, training and retaining skilled employees also remains a major operational challenge.
The report noted that outright purchase continues to appeal to Indian consumers due to a deep-rooted preference for wealth preservation. However, rental, lease and deferred-ownership structures could improve affordability and expand the total addressable market.
Allowing family members above a reasonable age threshold to reside in these communities could also improve adoption, as many purchase decisions are made jointly by couples.
The future is likely to favour hybrid ownership structures supported by transparent buyback, resale and service frameworks, rather than a pure rent-only or sale-only model, Colliers India noted.
