The land lease developer’s Joint CEOs John Carter and David Dixon have told its annual meeting that the environment is right for its core customer base, which is roughly 40% of households that can pay no more than $400 per week in rent and no more than $400,000 in purchase price.
“Aspen is growing rapidly. We now own over 3,600 dwellings and sites – up about 70% over the past two years. This includes over 500 approved sites for our new development pipeline – a sevenfold increase over the same period – and over 400 dwellings in our redevelopment and refurbishment program. We have been methodically growing the portfolio by acquiring and developing properties that our highly suited to our business model and customer base,” said the CEOs of the Perth-based group.
“For instance, we recently announced the acquisition of the Meadowbrook Lifestyle Estate near Bunbury, Western Australia. This is a land lease community with approvals in place for 181 houses of which 17 have been built and sold to date. We expect to sell new, modern houses starting as low as $225,000 with a land rent of $160 per week.”
Aspen, which announced in September an operating profit of $9 million, up 36% over 12 months earlier, operates three different property classifications – retirement, residential and parks.
It said it expected to increase development sales and profits in land lease communities in the next two financial years.
“This financial year to date, we have settled seven new house sales at an average profit margin of about $110K or 34%. Additionally, the market value of newly-released sites is above current book value (below $30,000),” said Mr Carter and Mr Dixon in a joint statement to investors.
Aspen Group’s shares have hit an all-time high of $1.72, increasing almost 40% since the AGM. It dropped to $1.70 yesterday.
