Metlifecare will build a $180 million retirement village in Auckland’s Beachlands, one of the ‘greenfield’ sites the industry has been busy sewing up in the past 12 months.
For Metlifecare, it marks the second investment of that magnitude in six months, after its $240 million proposal for Scott Point in Hobsonville, announced in October.
Today the company said it has acquired three adjoining properties in the coastal suburb of Beachlands for a new village with the first stage ready by early 2020.
Last month rival Summerset secured a nine-hectare site in Napier, near the Maraenui Golf Club, its second in the seaside town. It added land to its Casebrook village in Christchurch in November. Last week Ryman Healthcare, the biggest listed retirement village company, said it would invest $100 million for a village in Havelock North and in December it obtained land in Karori, Wellington.
“The retirement-age population in our catchment area is expected to double in the next 15 years,” said Metlifecare chief executive Glen Sowry. “With the closest existing villages nearly 20km away, we are very pleased to be the first retirement village provider here.”
Sowry said he is confident the development will be value-accretive for the company. The company says it expects the units in the Beachlands village will range from $600,000 to more than $1 million, allowing the company to meet its development margin threshold of 15 percent.
Construction will start on the new site in early 2019. The development will be Metlifecare’s 24th operational retirement village, offering 210 units and care beds.
The company was upbeat about its full-year results when it posted its first-half profit in February, a drop of 66 percent, in a period when it recognised leaky building costs and noted a cooling property market.
Sowry said the new site would provide the company with “a tremendous opportunity” to meet the needs of an area that is not currently served with retirement living options.
The area is favourable for retirement construction, with an older-than-average population, high levels of home ownership and median house prices of around $1.2 million, he said.
Settlement is expected in August 2018.
Sowry reiterated the target to complete 254 new retirement units and care beds in the year ending June 30. The new site will take Metlifecare’s development pipeline to just under 2,000 units and beds across its 24 operational villages.
Metlifecare shares slipped 0.3 percent to $5.98, having gained 7.3 percent in the last year.