Major property company Stockland says it will be ‘business as usual’ for its retirement village residents after announcing today it had sold its entire village business for nearly $1 billion and at the same time increased investment in the booming land lease community sector.
EQT Infrastructure will acquire Stockland’s portfolio of 58 established retirement villages and ten development projects.
CEO and Managing Director of Stockland, Tarun Gupta said: “I am delighted that we have found a strong retirement living owner and operator to acquire Stockland's retirement living platform.”
“EQT is a purpose-led organisation with a well-established track record in healthcare, aged care and retirement living.
“We are confident that EQT will be the right custodian for the residents and employees, and are well placed to support the continued growth of the high quality retirement living platform.
“The announcement today does not impact on any of the arrangements with our residents. It will be business as usual for our residents, noting on completion they will have a new partner with significant experience in running industry leading retirement living villages.”
The transaction remains subject to approval by the Foreign Investment Review Board, while the Affinity Village (WA) is subject to a separate sale process that is underway and is not included in this transaction.
Partner and Head of Asia Pacific for EQT Infrastructure, Ken Wong, said: “From the outset we’ve been very impressed with the team and the first-rate retirement living portfolio Stockland have built.
“Stockland Retirement Living is a clear leader in the Australian retirement living space and we are excited about working together as we transition the business toward a standalone platform that continues to develop and operate high-quality retirement villages.
“With an aging Australian population and increased need for specialised care, we are excited to have the opportunity to use our significant global experience in the sector to enhance the range of services provided to current and future residents of Stockland’s villages.”
At the same time it is selling retirement villages, Stockland is ramping up activity in over 50s land lease communities.
In 2019, Stockland announced it was developing ten new land lease communities, while in 2021 it announced it had acquired 13 existing and future Queensland land lease communities operated by Halcyon.
Today, Stockland said the integration of Halcyon was progressing well, while it also announced a new partnership with Japanese developer Mitsubishi Estate Asia to develop and own land lease communities.
The partnership will have an initial value of around $500m and lead to the expected development of six initial communities with 2,000 home sites.
All up, Stockland says its land lease portfolio has scaled to around 9,000 home sites (including occupied home sites), with a development pipeline value of approximately $5 billion.
Stockland competitor Mirvac also announced last week that it would be developing new land lease communities.
Based on the messaging in the announcement, it appears likely that EQT sees an opportunity to better link Stockland's retirement villages with a home care or aged care offering.
Comment from our CEO
Commenting on the announcement, Downsizing.com.au CEO Amanda Graham said: “While Stockland is selling its retirement village stock, which caters for a much older demographic, it is actually increasing activity in over 50s land lease communities."
"This is a strategic pivot towards a hot new market which is growing very rapidly in Australia, led by downsizing younger baby boomers looking for lifestyle, location and price point."
Find out more:
- Lean more about retirement villages, land lease communities and other retirement living options in our new Ultimate Guide to Downsizing
- Read our report: land lease communities booming in COVID-19 era
- Inside Australia’s hotel-like luxury care villages catering for the demanding Baby Boomer generation