January

The recent document ‘Village Budgets & Accounts’ published on 11 January 2022 by NSW Fair Trading, clarifies that a group of chairs purchased together and costing $1,000 will be captured in the new Asset Management Plan (AMP). “The NSW Government Asset Management Plan is laborious and unrealistic,” said Christine Osgood, National Operations Manager, Living Choice Australia, which operates retirement communities in parts of NSW, Queensland and South Australia. “I do not see how it is going to achieve the intent of the Plan. The AMP has been designed by someone behind a desk who has little idea about the retirement industry and the extent of its assets.”

Frank Price, CEO of the Royal Freemasons’ Benevolent Institution (RFBI), told The Weekly SOURCE the provider is being forced to spend $10,000 a day on Rapid Antigen Testing (RAT) to keep residents and staff safe from COVID-19. “We are bleeding cash profusely,” said Frank. “I have put in an order for $250,000 of RAT and that lasts four weeks. What the Federal Government supplies just supplements that.”

Not For Profit Bolton Clarke appears set to dominate both the retirement living and aged care sectors in 2022 after acquiring private operator Allity’s aged care portfolio in a rumoured $700 million transaction. Under the binding agreement announced on 17 December, Bolton Clarke will add Allity’s 43 aged care homes and over 3,800 beds to its portfolio of 37 aged care homes, 36 retirement villages and over 130,000 home care clients.

Approximately one in three Village Managers across Australia is now a member of the DCM Institute Professional Development program, three years after its launch. In response to new regulations in each state promoting ongoing skill upgrading and the requirement of the Retirement Village Code of Conduct, the DCM Institute is specifically designed to both comply and develop the hard and soft skills required by Village Managers.

February

The ASX-listed operator Stockland has followed through on its promise to reduce its exposure to the retirement living sector, announcing that it has entered into a binding Sale and Purchase Agreement with global investment firm EQT Infrastructure (EQT) to take full ownership of its Retirement Living business for $987 million – seven years after a sale was first flagged. Under the terms of the agreement, EQT will acquire Stockland’s portfolio of 58 retirement villages, 10 development projects underway and in planning, and its associated management platform, with over 300 employees to transfer to EQT. EQT was assisted by Ansell Strategic in the transaction.

Land lease is affordable accommodation, particularly for pensioners and single men and women. Part of the affordability equation is that Centrelink subsidises the rent component for these pensioners. Thus, the question is: why aren’t Not For Profits engaging with this sector? And while the large-scale private operators aim for 150 to 400 homes on a site, there is no reason why LLCs can’t be just 50 homes, appropriate for Not For Profits that have smaller blocks in regional areas.

The capital growth value of enviable retirement living is evident at the Mounties Group-owned Watermark Freshwater on Sydney’s Northern Beaches. When it was marketed for its launch in 2018, the 96 apartments – all with terrace or balcony – were priced from $1.5 million to $3.8 million. Village Manager Miranda Aiello told The Weekly SOURCE that Watermark Freshwater’s ground-floor apartments were now priced at $1.6 million to $1.7 million with the 11 three-bedroom penthouses costing more than $5 million. “We are full with a substantial wait list,” she said.

Established in 2006, villages.com.au has grown steadily through the Global Financial Crisis (GFC), negative media coverage and now a changing consumer, thanks to the first Baby Boomers reaching age 75. In 2021, traffic grew 11% Year on Year with over 1.3 million visits. Last month saw another significant jump, significantly in the number of people reaching out to operators, seeking more information. All up, 17,400 people took the next step with a website click, phone call, or an email, which was the choice of 1,200 people. To place this in perspective, just 23,000 village homes become available to sell.

March

The thirst for luxury land lease living appears to be unquenchable as GemLife’s new over 50s resort at Pimpama in the Gold Coast sold its 26 homes in Stage One for $18 million in just two days. Many (of the buyers) are in the younger end of the over-50s demographic and the fact GemLife Gold Coast caters to such a diverse range of interests and provides so many opportunities for social interaction is appealing, as are the high quality of the homes and the location,” said GemLife Founder and Managing Director Adrian Puljich, a speaker at the LEADERS SUMMIT in Sydney last Thursday.

Stockland is on the march as it seeks to dominate the profitable land lease market. Last month, the property development group announced it had established a new Stockland Residential Rental Partnership with Japanese real estate investor Mitsubishi Estate Asia. At the same time, Stockland sold its full retirement village portfolio for close to $1 billion to global investment fund EQT, and CEO and Managing Director Tarun Gupta (pictured with Levandre CEO Suzanne Dvorak who was appointed in August) revealed it had paid $47.5 million for a 13ha site (marketed as St Germain Village) at Clyde North, 35km southwest of Melbourne’s CBD. The proposed new Stockland Halcyon community will be within the St Germain Estate and adjacent to the future St Germain Town Centre.

The number of vertical villages is increasing, with 41% of new retirement village developments in 2020-21 being classified as vertical – an eight-percentage-point increase over the previous year. Data from the Retirement Living Council’s PwC/Property Council Retirement Census Snapshot Report shows that 18% of the total retirement village market is now made up solely of vertical developments, around double the market share from 2016, with combination villages also growing.

With land lease operators proving to be the most affordable option, the Property Council’s Retirement Living Council has for the first time recommended Federal Government provide rental assistance to prospective village residents. With 90% occupancy across retirement villages, the peak body wants to allow people with lower incomes, including mature-age single women, to move into the safe environment of a retirement village. A retirement village resident is deemed to be a homeowner (even if they do not have freehold or strata title of their unit) when their ingoing contribution is more than the difference between the homeowner ($268,000 single) and non-homeowner ($482,500) asset threshold. This means, if a retirement village resident pays an ingoing contribution higher than $214,500, they are ineligible for CRA.

”Miserable” can be the only way to explain the growth in retirement village home values over the past five years. The latest Retirement Living Council/PwC Census reports that across 55,335 village homes, their value only increased 4% in 2021 versus a CoreLogic national average of 22% for residential homes. A two-bedroom village home shrunk to just 55% of a local median house value, compared to 67% in 2020. Does this mean lower demand is forcing down prices – or are village marketers and salespeople weak in asking for more cash? More likely both are correct.

April

Over the past three years Westpac has been receiving applications and making funds available to retirement village developers at a higher rate than it has been funding residential aged care developers. To appreciate this scale of funding now passing through the village and care sector, in 2019 aged care invested $5.6B in new builds and refurbishment, according to government records. Louise Johnston, Director – Health & Aged Care at Westpac, told us at a private lunch in our office that they have over $2 billion in funding in the sectors at any one time and that the sectors are vitally important to the bank as a lending business.

South Australia’s O’Loughlins Lawyers has been named Best Lawyers’ Law Firm of the Year 2023 in Retirement Villages and Senior Living Law, while lawyers from firms such as Thomson Geer and Russell Kennedy have been honoured as state Lawyers of the Year in the fields of retirement villages and senior living. O’Loughlins Partner Rebecca Barr, who leads the firm’s Health, Aged Care and Retirement Living team, told The SOURCE that she is proud of her team’s accomplishments.

Aveo CEO Tony Randello dropped by our office to have a video interview with Editor Lauren Broomham (pictured). 15 months into the job, Tony revealed that Aveo achieved 1,250 retirement village home sales in 2021, up from 822 in 2020, an increase of 52% and the biggest sales number in Aveo’s history. Tony also pointed out that Aveo has a big presence in Victoria, which was held back in marketing for months thanks to COVID-19 restrictions on Open Homes. 2022 sales should be higher.

An email from Alok Kumar, CEO of Omega Communities in Adelaide, asked if the DCM Group had information on retirement village penetration in New Zealand and Australia - a subject worth revisiting for all RV operators. The New Zealanders keep excellent stats and they gleefully tell us that penetration for all people 75+ has increased from 8% in 2008 to 14% in 2021 on the back of their continuum of care village business model. In 2011 in Australia, we had 137,467 people living in a retirement village, or 4.6% penetration. For the village sector to maintain 4.6% penetration, it would need to house an additional 56,361 residents, which at an average of 1.3 residents per village home is 43,354 more homes that would have had to be built each year for the past 10 years. This hasn’t happened.

The $490 million paid by the Australian super fund Aware Super for a further 24.9% share of Lendlease’s 75 retirement villages is a vote of confidence in Australia’s retirement village sector – but with the village value proposition shifting towards a continuum of care, operators need Plan B. Aware Super already paid $460 million for a 25% stake in the ASX-listed operator’s Retirement Living business just over 12 months ago in February 2021. This latest announcement follows Stockland’s recent sale of its Retirement Living business to global investment firm EQT Infrastructure for $987 million, close to its $1 billion book value. Under Plan B, older Australians with the means to pay will co-contribute to their care – this will give village operators the confidence to invest in continuum of care service offerings, commit the capital to new developments and increase their pricing to match.

May

Palm Lake Resort Sales Manager Alysia Nechvoglod said building can now start on Palm Lake Resort Pelican Waters on the Sunshine Coast. “The first homes and facilities will be next with a new opening date anticipated early in 2023. Of course, that is contingent on the weather conditions,” she said. There will be 321 homes built with either water frontage or direct golf course access on Palm Lake Resort Pelican Waters. A lakefront country club will offer a sports centre, social centre and wellness centre.

There are two factors in favour of a positive impact by the change in government on retirement living. The first is that Mark Butler will become the Minister for Health and Ageing. He has an excellent understanding of the seniors’ landscape, having been the Minister for Ageing between 2010 and 2013. The second reason for the Federal Government to engage with the village sector is that it is self-funding – there is no Government subsidy. And yet villages keep older Australians out of home and residential care longer. With the massive cost of a 25% pay rise likely for aged care staff from the Fair Work Commission, requiring $4.3 billion alone, the Federal Government has no choice but to look for alternative models.

Ryman Healthcare’s devotion to Victoria has no bounds with it now announcing its biggest project in Australia. It has paid $48.2 million for a 2.56ha block, formerly the Federal Government’s Australian Defence Apparel site, where it intends to build a $350 million integrated retirement village in Coburg North in Melbourne. The village will combine independent living apartments and an aged care centre, including specialist dementia care, on a single site.

New enquiry for retirement village accommodation surged in 2021 off the back of lockdowns across the country and especially in Victoria on villages.com.au. 2022 opened with enquiry being down 11% on 2021, narrowing to 3% in April 2022. Four months of rain up and down the East Coast plus an election will also have impacted enquiry. Even so, in April we experienced 104,000 unique visits to villages.com.au, which compares to the available stock to sell being limited to 1,916 village homes on average per month (23,000 per year).

The Property Council’s Retirement Living Council is to be congratulated for its diligence in finding what the operators wanted – a preferred industry insurance partner. With increases in village insurance premiums and premium excess, driven by the increasing number and severity of fire, floods, storm damage and the continuing impact of COVID-19 hurting many operators, let’s hope this brings at least stability to insurance premiums for the sector. Insurance is often one of the larger line items in a village budget, and rises in premiums have significant impacts on an operator’s bottom line. Insurance brokers across the board clearly communicated that the retirement living industry needs to improve using data to create a comprehensive risk-management profile. Basically, the industry needs to help itself if it wants to see fairer premiums.

From out of nowhere the Puljich family has emerged with 43 land lease communities and a pipeline in excess of 11,000 homesites. By comparison, market leader and listed operator Ingenia has approximately 4,200 homesites. Across the 40 odd excellent speakers at our LEADERS SUMMIT in March, CEO Adrian Puljich stood out for his age, his confidence and on message presentation. That message: GemLife will be the largest land lease community operator by any metric by December 2022.

June

Three-bedroom homes at GemLife Gold Coast are selling for $640,000, compared to realestate.com.au’s median price for a three-bedroom house in Pimpama at $530,000. More than $60 million of homes have sold off-the-plan in the $200 million GemLife Gold Coast, including all 26 traditional homes released in Stage One and more than 70% of the 88 homes released in Stage Two. More than 50% of buyers are aged under 65, with CEO Adrian Puljich saying the age of residents across its portfolio of communities along the eastern seaboard is continuing to fall.

When the GFC kicked off in October 2007, retirement village sales stopped overnight as potential customers refused to drop prices on the family home, stalling their move into the village. The experts say we can expect housing prices to drop by 20% thanks to increasing interest rates. This may occur across the country but I don’t believe it will happen where village customers are located. In simple terms, village customers have large homes on bigger blocks that suit families, in middle ring Metro suburbs or established regional suburbs. The families looking to buy these homes, looking for schools, close to family and close to work, will be in their 30s and 40s and established.

Uniting NSW.ACT, which aims to invest around $3 billion in the next decade, is inviting the community to have its say on a major integrated care site in NSW’s Lake Macquarie region. The seniors’ living proposal will be located on the former TAFE campus site on Tiral Street, Charlestown. If approved, the site will be transformed over several stages and will provide a mix of aged care, retirement and independent living units, co-located with support services and facilities. The proposal contains four buildings that will be developed in stages across the site.

The ‘missing middle’ is how single women without sufficient funds for real housing has been termed, a group many retirement village operators know well from at times desperate enquiries for accommodation. To the credit of the Retirement Living Council, they have led an initiative that goes somewhere to solving the problem – doing the deep policy work for government that could unlock significant retirement village stock, including homes no longer fit for contemporary housing but still more than fit for purpose. As an opening proposition, the RLC offers a minimum 400 village homes to be available in the first year. For a government to build 400 affordable housing homes, at say $300,000 each, would be cost to government $120 million. This does not reflect the real picture as the type of village stock offered is often in prime inner and middle ring suburbs where the land content alone would be $500,000+.

When Ryman Healthcare revealed a full year audited underlying profit of NZ$255 million it showed a new sale margin of 24.3% and combined margin of new and resales of 25.8%. This compares to ~16% for the major new village developers like Stockland. The SOURCE asked Ryman Australia CEO Cam Holland (pictured) how the business achieved such a high new sales margin. “Because we have our own experienced construction teams leading the development of all our villages, we’re able to effectively manage costs in real time. We’ve been in this business for almost 40 years, so we have strong, long-standing relationships with subcontractors and suppliers. As a large operator with a long pipeline of developments ahead of us, we’re able to negotiate bulk supply agreements to ensure we’re getting the best deal possible. A strong real estate market in Victoria has allowed us to maintain solid price growth, which contributed to our strong margin on new sales. Pricing is set in accordance with the unique local factors in any given area, but a two-bedroom unit is typically around 70 per cent of the median house price in the local market.”

July

Over seven days in Brisbane and then Melbourne, the pay scales for village managers were questioned. The conclusion in both cities is that the regulatory and legal pressures have outgrown the pay scales for village managers. In Melbourne filming the first episodes of our NINE Network TV series on ageing, at one village, the manager reminded Chris Baynes of his first newsletter editorial 17 years ago where we discussed the pay rate of $65,000 for village managers being inadequate then. The village manager pointed out that not only is the regulatory world far different and more complex, but the Government is now auditing and enforcing regulations. While not divulging their pay scale, the fact is that village managers’ average wage remains at $80,000 nationally. That is a $15,000 increase in 17 years.

After seven years, Blacktown Workers Club, which is changing its name to Workers Lifestyle Group, has been given approval to build a $500 million retirement village and co-located aged care home on land it owns at the club in the Western Sydney suburb. The 480 independent living units, together with a 160-bed aged care facility, is the next step of a major project which began with the completion in March 2019 of the H E Laybutt Sporting Complex, a $30 million sporting precinct. A revised application to the Sydney Central City Planning Panel was approved, providing a Site Compatibility Certificate that opens a pathway through to a Development Application for the development.

Ben Myers (pictured) said it was his decision alone to resign as Executive Director of the Property Council’s Retirement Living Council (RLC). “There is not a right time to do these things but to me it is as good a time as any to make the move and make way for a change,” he told The SOURCE. The retirement sector is, according to Ingenia Communities’ Chairman Jim Hazel entering a “golden decade”, with the ageing population, helped by the COVID-19 pandemic, seeing large scale development and high occupancy rates. Ben took the role just after ABC’s Four Corners’ “Bleed them until they die” eroded public trust in the retirement village sector.

Blue Haven Illawarra, Kiama Municipal Council’s aged care and retirement living operator on the NSW South Coast, has been fined $2,200 by the NSW Office of Fair Trading for failing to keep an up-to-date Asset Management Plan for its Terralong and Bonaira independent living units. Asset Management Plans (AMPs), which are causing some confusion among operators and residents, document purchase, replacement, repair and maintenance of major items.

Many retirement villages now offer prospective residents and their families several contracts to enter the community, which is welcome. However, the much-maligned Deferred Management Fee (DMF) is back in vogue, says Tony Massaro, the PwC Partner, who is behind the Retirement Living Council Census. Tony said the data over the last six years reveals that the maximum DMF is reducing, along with the number of years the maximum DMF is calculated on.

August

Ingenia is riding the crest of the ageing population wave despite the obstacles of COVID-19, floods, supply shortages, and price hikes being thrown in its way. Managing Director and CEO Simon Owen announced an $87.9 million Underlying Profit for the financial year to 30 June, an increase of 14% on last year. “The value of investment properties we own or manage is up over 90% to $2.1 billion. The number of communities we own or manage is up 46% to 110 communities and the size of our development pipeline, a great indicator for future growth and profitability, has increased by upwards of 55%,” Simon told the conference call. “Ingenia is one of the fastest-growing REITs in Australia, and I would comfortably predict that we are only several years into a 30-year super cycle being driven by the ageing of the population and the desire for high-quality community living.”

Nathan Cockerill (pictured with residents), Lendlease Retirement Living Managing Director, is a hard man to catch in the office in Melbourne. More often than not he is out of State visiting one of the ASX-listed company’s retirement villages. “I try to visit all our 75 villages at least twice a year and really value the opportunity to also hear about village life. We know the needs of retirees are constantly evolving and listening to our residents is the only way we can ensure we continue to provide the lifestyle they want and expect,” Nathan, who is on the executive of the Property Council’s Retirement Living Council, told The SOURCE.

Uniting NSW.ACT’s Bowden Brae, which is at 80% occupancy after opening in December last year, is being seen as a blueprint for the Not For Profit’s $3 billion investment plan. The retirement village in Normanhurst, 22km northwest of Sydney’s CBD, designed by PTW Architects, has won the Urban Developer Award for Industry Excellence and the Urban Taskforce Australia Award for Best Seniors Living Development in 2022. It was also a finalist for the Urban Development Institute of Australia Award for Excellence in Retirement Living.

Serenitas’ Thyme land lease operator has three new communities scheduled to open soon in the rural town of Canungra in Queensland’s Scenic Rim Region, Mareeba in the state’s Far North and Forster, on New South Wales Mid-North Coast. “We have experienced overwhelming demand and sold-out stage releases in record time across each of our Thyme Lifestyle Resorts,” said Serenitas CEO Rob Nichols.

September

Simon Owen (pictured), the CEO and Managing Director of Ingenia Communities, said he agrees with Meriton property developer Harry Triguboff when he told an Australia-Israel Chamber of Commerce business lunch that NSW is closed to development. “NSW is closed for business. Trying to develop affordable communities – you cannot get the approvals through,” said Simon. “It is a crying shame.”

Damaging advertising and now reputation damaging legal actions have been a major tool for the law firm Levitt Robinson in its bid to win a cash pool of up to $500 million from its class-action against Aveo. However, the latest move to seek a lien over the retirement village homes for up to 5,000 Aveo residents is potentially the biggest threat to Aveo and the sector yet.

Bellarine Lakes Country Club at Moolap, a suburb of Geelong, has commenced selling stage 8 despite construction not been completed until early 2024. The first two deposits were $1.23 million which compares to the same design priced in 2014 at $522,000 (three bedroom, double vehicle garage). Scott Waldron, Head of Sales & Marketing, points out the increase in price is $752,000 in eight years, a 137.9% rise. Over the last 10 years, the median house price in the City of Greater Geelong has increased by 106.2%.

Aspen Group, whose model is aimed at households that cannot afford more than $400 weekly rent or $400K purchase price, raised $36.34 million from investors in just 24 hours. The strong interest in the Sydney-based Group, which owns and operates land lease communities, residential homes and holiday parks, proves that investors are still keen on the sectors despite the negative sentiment in residential housing, given increasing interest rates and construction costs.

Ben Myers, the outgoing Executive Director of the Retirement Living Council, expressed extreme frustration with the lack of respect for retirement living and aged care operators shown by governments, and by extension, bureaucrats. “The need for government to listen to industry, and support Australians to find affordable and accessible age-friendly communities, could never be greater. On one hand, governments know they have to do something about ageing, but on the other they continue to fiddle with legislation, ignoring industry advice and facts, to make age-friendly communities less affordable and less accessible.”

October

In two conversations, we heard of the significant price escalation some operators are achieving in this high demand market. In Melbourne, one operator had a village unit that was about to be priced at $900K when their sales executive said they thought they could get $1.1M if they worked with keen buyers. It sold for $1.4M. The increased revenue is extraordinary and the positive impact on residents is also very strong, especially if they are sharing in the capital gains. As one operator told us, the discussion on the cost of refurbishment has evaporated.

Stockland CEO Tarun Gupta is targeting an operating profit margin for LLC in the range of 10% to 15%. “The strong demand for our Land Lease Communities development product means we have already sold all our expected completions for FY23 and are now selling well into FY24. In the first quarter, the established portfolio achieved average rental growth of 6.3%, with occupancy and rent collection rates remaining at 100%.”

Across 13 speakers at our LEADERS SUMMIT Masterclass, the repetitive theme was that tomorrow’s retirement accommodation customer (the Baby Boomer) expects ‘community’ to be packaged into the living environment. And they want cash today to live well and they want to control their life – not have their life controlled. Build to Rent ticks all these boxes. More sophisticated concierge services that incorporate community building and care guidance are emerging, like Chanje Partners and “Move, Nourish, Connect” by Five Good Friends. With Build to Rent, customers can sell their family home at, let’s say, $1.5 million, and put that money in the bank or an investment to pay their rent – but they have control of that money to do what they like. Our figures show that, in real dollar terms, they are better off as BtR customers than village customers over 10 years.

Mounties Group CEO Dale Hunt (pictured) has told the DCM LEADERS SUMMIT Masterclass in Sydney how club retirement communities have boosted Mounties’ membership, assets and profits. Dale told Masterclass guests that, where most retirement living developments start with a village and build a community around it, Mounties’ club-based villages have started with existing communities and built villages for them. “We moved into property because our members started to say, hey, I need a place to retire – so we built a retirement village,” he said.

November

RetireAustralia is in good shape, with underlying profit up almost 40% in the six months to 30 September 2022. The operator, which reportedly has two interested suitors in Lendlease and Australian Unity, has enjoyed strong sales and high demand. According to Infratil’s Annual Report, as at 30 September 2022, RetireAustralia had 93.3% occupancy across its portfolio (up from 92.3% at the end of March this year, and the highest result since 2017) and waitlists at 20 of its villages.

Land lease developer Serenitas could be snapped up by Stockland before the year is out, with an $800-million-plus deal reportedly on the table. As reported in The Australian, sources have indicated a deal by Stockland to buy the entirety of Serenitas – which is 95% owned by Singaporean investment firm GIC, and 5% by founder and CEO Rob Nichols – could be agreed to by the end of the year, with the sale being handled by advisors Jarden. Stockland has been expanding its land lease portfolio following its $620 million purchase of Halcyon in July 2021.

The second episode of our TV series, The Best 30 Years, went to air nationally on 9Gem. We utilised approximately 10 of our specialists on ageing in this episode, plus interviews on location with six of the approximately 20 residents of land lease communities we interviewed across the country. View the full 22-minute program or the individual six minute segments HERE on The Best 30 Years website, or you can watch on YouTube and on our villages.com.au blog.

Nine months into his role as CEO of Anglicare Sydney, Simon Miller has been able to convince his traditionally conservative board to outlay $20 million plus debt exposure to acquire 50% of two village operator LDK. By comparison, Anglicare has 23 big villages in Greater Sydney alone. The deal specifically states that LDK will remain independent and can make its own way in the world. So what was the attraction for Miller and his board? The answer appears to be that Anglicare wants to learn about LDK’s private aged care model, its value proposition and LDK’s marketing. LDK breaks the traditional village model on multiple levels and is delivering better outcomes for residents, staff and profits.

An examination of villages.com.au new village listings reveals Australia has averaged 16 new retirement villages each year for the past 10 years – but when the data is analysed, it uncovers 92 villages hitting the ground in the last three years, an average of 30 a year. This is encouraging. 30 projects a year, with average build cost of $400,000 and average size of 85 units, means $1 billion a year is flying into a retirement village construction.

Daniel Gannon, the new Executive Director of the Retirement Living Council, has outlined his three big priorities for his tenure as he settles into the role, including educating politicians and the public on the benefits of age-friendly communities. Speaking to The Weekly SOURCE, Daniel, who has a long family history in the retirement living sector, said there are opportunities for the RLC in the current housing crisis to discuss ways of injecting new housing supply into the market.

Two overseas real estate investment firms have teamed up to pour $1.5 billion into the Australian Build to Rent (BTR) sector, signalling its strength and its position as a serious retirement village competitor. Global investor Hines and Canada-based Cadillac Fairview will invest in at least three BTR development sites, including a site in South Melbourne announced by Hines in May, focusing on projects in areas near transportation, employment, retail, and entertainment.

Ryman Healthcare’s half-yearly results have supported the strength of its continuum-of-care model, with underlying profit up 44.8% and its Australian business performing well. The NZ-based operator posted a first half underlying profit of NZ$138.8 million (around AU$128 million) for the 2022-23 financial year, with strong Australian growth driving a 9.8% increase in booked sales of occupation rights, though reported profit dipped 31.1%, which the company ascribed to lower unrealised gains on investment properties.

The NSW Government has released an Explanation of Intended Effect (EIE) on its proposed amendments to the State Environmental Planning Policy (Housing) 2021 (Housing SEPP), including a draft Seniors Housing Design Guide developed by Calderflower Architects. The EIE from the DPE includes proposed updates to accessibility standards for seniors’ independent living units, as well as the reclassification of what used to be called “hostels” into a “supported living” category, encompassing smaller-scale seniors and disability housing.

December

RetireAustralia is officially off the market, with New Zealand-based owners Infratil and NZ Super Fund (NZSF) resolving to keep their shares in the operator following a strategic review. Despite reported interest from Australian Unity and Lendlease in acquiring the business, which at one point had an estimated price tag of at least $1 billion, Infratil and NZSF will each retain their 50% stake in RetireAustralia, which saw strong annual results this year. The strategic review concluded that, despite it being a “relatively small part” of Infratil’s portfolio, retaining and supporting RetireAustralia would be the best way to maximise stakeholder value.

A long-running saga has come to an end on the NSW Central Coast with the approval of Uniting NSW.ACT’s $148 million redevelopment of its Nareen Gardens co-located retirement village and aged care home at Bateau Bay. The Hunter Central Coast Regional Planning Panel approved Uniting’s revised plans despite sustained pushback from local community groups. The development will comprise 180 independent living units and a 160-bed aged care home.

Listed NZ building products and construction company Fletcher Building has launched its first retirement village development titled Vivid Living. Bucking the established DMF market of 25 to 30%, it is offering 15% with 50% capital gain share, fixed service fees and concierge services on a fee-for-service basis. The village will be part of a larger Fletcher Living Community at Red Beach in Auckland. Instead of privately complaining about perhaps damaging the higher 25 to 30% DMF, a NZ Retirement Village Association spokesperson told us they welcome this demonstration of diversity of choice in the New Zealand retirement village market.

DCM has surveyed 40 of the most dynamic and interesting retirement living and aged care industry leaders about their outlook for 2023. Retirement living operators are focusing on developing new and innovative models of care that deliver baby boomers more dynamic and flexible retirement living options. Nearly than half of those who responded (46%) said they will be investing in co-located/continuum of care retirement living models. Just less than one third (30%) said they will be investing in land lease communities, and the same proportion said they will be investing in private aged care (where care is provided right up to the palliative level under the Retirement Living Act).