The first sale by the nation's only pure-play provider of rental communities will be its village in Mount Gambier, the second most populated city in South Australia, 450km from the state capital Adelaide, for $5 million, slightly below the 30 June 2024 book value of $5.1 million.
Simon Owen, CEO of Eureka Group Holdings, said the contracted sale of the 58-unit village (pictured) represents the start of a comprehensive asset recycling program with a further $25-30 million of asset sales planned over the next 12 months.
“We continue to focus on portfolio enhancement as well as the delivery of operating efficiencies and this divestment is in line with this objective. The sale proceeds will be deployed across our growing pipeline of opportunities in the rental business as we continue to target quality acquisitions, expansion of existing communities, re-purposing existing built form into rental communities and greenfield development," Simon stated.
Eureka announced in July 2024 that it had put its Mount Gambier and its a 57-unit complex in Whyalla Norrie on the Eyre Peninsula for sale through Colliers. Mount Gambier currently operates at 77.5% occupancy and has traded as low as 65% over the past 12 months.
In October last year, Eureka announced it was raising $70 million as it was in due diligence to buy 441 units in seven villages and, in addition, has bought or is in the process of buying 38 single units across four managed villages for a total of $49.9 million. The Group has also identified expansion of villages costing $7.5 million.
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