This article is from the Australian Property Journal archive
ASPEN has made a $2.36 million purchase in the Lewis Fields Retirement Village in Strathalbyn, adding to the group’s growing cluster in South Australia.
Entering into conditional contracts, with settlement expected for June, Lewis Fields represents Aspen’s fifth acquisition in FY21. With the addition brining the group’s approved site up to 2,745, a growth of more than 25% in FY21 so far.
Located in the heritage town, of Strathalbyn, within an hour’s drive of the Adelaide CBD, Lewis Fields’ is the only under development retirement village in the suburb and the only one currently offering new housing.
The Lewis Fields property is comprised of 3.7-hectares and is approved as retirement village for 80 houses, with only 26 having been built to date, with site infrastructure currently in place for the next four houses.
“We expect our experience in the retirement sector and our quality local team of employees, consultants and contractors to add substantial value to Lewis Fields and its residents,” read the board’s announcement.
Recent resales have been priced around $300,000, for a total exit fee of up to $110,000. In addition to the 26 houses, the community building and gardens have also been completed.
The current houses are occupied under a loan/lease agreement with total exit fees of up to 37%, 25% of which are deferred management feels and the remaining 12% capital replacement fund contribution. Aspen plans to reduce total exit fees to around 20%.
Residents in the village, who have an average age of around 79 years, also pay for nearly all operating and maintenance costs in the village.
Aspen plans to sell the remaining 54 houses under a lend lease community model, offering Commonwealth Rent Assistance to cover a portion of the land rent.
“Strathalbyn is a small but growing market, so we expect the sales rate to be only a handful a year in the near term. However the purchase still makes sense for Aspen as we can manage both Lewis Fields and out proposed new LLC at Mount Barker with the same personnel.”
With the purchase price equating to around $30,000 per approved site and current 26 houses, Aspen believes the existing dwellings have a re-leasing value of around $300,000 per house, or $7.8 million all up.
This acquisition, which will be initially funded by debt, will bring Aspen’s land development pipeline to 261 sites across four projects.
