This article is from the Australian Property Journal archive
AUSTRALIA and New Zealand-listed retirement village operator Summerset will invest $600 million newly acquired sites on both sides of the ditch, while it announced 9.2% growth in first-half profit.
The acquisitions are in Melbourne’s north eastern suburb of Mernda, and in Masterton and Rotorua in New Zealand.
“In a strong northern growth corridor of Melbourne with significant population growth expected, the location has seen substantial investment in roading, infrastructure and amenities including the development of a $500 million town centre, a community hospital and new train station,” CEO Scott Scoullar said of the Mernda site.
It is the sixth site Summerset has acquired in Victoria, giving it capacity to build 1,700 units in the state. Last year it picked up a 1.83 hectare parcel in Oakleigh South for $33 million.
The group, whose total assets grew 22.9% to NZ$5.4 billion, posted an interim underlying profit of NZ$82.5 million, following last year’s 68% in profit. Reported profit after tax was NZ$134.6 million.
It delivered 223 new retirement units for its second-highest first half, and is on track to deliver about 600 units for the full year.
Scoullar said the group did increase pricing while the residential property market rose significantly over the two years to December.
“This provided us with a buffer going into what could be a flat to declining market in the coming months,” he said.
“We’re not seeing excesses of stock or any changes in demand either, our available retirement units have stayed steady, and demand doesn’t appear to be tethered to the property market.
“Enquiry levels remain high, and waitlists are strong and currently we’re not seeing any increase in days to sell or settle for people moving into a Summerset home. Our total sales for the half were 511, limited principally by availability of stock,” Scoullar said.
Development margin was 28.1%, up from 21.6% and above its expectations of 20 to 25%.
It declared an interim dividend NZ10.7c per share.
