Ingenia Communities Group today announced further expansion of the Group’s lifestyle and holidays business with the acquisition of a premium lifestyle community and a mixed-use holiday resort located in Queensland.
The acquisitions deliver on the Group’s growth strategy as Ingenia deploys the $178 million of capital raised in May 2020 to expand the lifestyle and holidays business.
Ingenia Communities Group CEO, Simon Owen, said that following completion of these acquisitions the equity raised last year would be fully deployed, and further acquisitions are anticipated before financial year end, despite a marked increase in competition for quality communities and development sites.
“We are seeing the benefit of a pipeline and relationships that have taken many years to establish as we continue to access quality assets. With an increasing awareness of the resilience of the cash flows from our lifestyle communities and a buoyant market for domestic travel, the attractiveness of our sectors has never been greater. We remain well placed, with an extensive pipeline in place which is allowing us to continue to build our portfolio and rental base through the addition of quality assets,” Mr Owen said.
Ingenia has entered into an unconditional contract to acquire Nature’s Edge over 50’s community, at Buderim, Queensland. The acquisition is expected to settle late March 2021.
Nature’s Edge has been developed over the past six years into a premium community of 181 homes with extensive, high-quality facilities. In addition to Nature’s Edge the acquisition includes The Village Forest Glen (comprising 51 permanent homes) and the Forest Glen Holiday Resort, which currently forms part of the approved 68-home expansion of Nature’s Edge. On completion the community will comprise 300 permanent homes, providing a significant rental base.
Community facilities include an indoor swimming pool, expansive community centre with cinema, bar, dining area and billiard tables, bowling green and tennis court.
New homes in the last three stages are expected to sell for an average of $600,000, with current resales ranging from $550,000 to over $700,000. The project has a strong track record for sales and is established as a highly desirable community. On completion of the acquisition, works will commence to relocate the existing tourist cabins and develop the remaining 68 approved homes. Development is anticipated to commence in FY22 with first settlements expected in 2H22. In addition, the community has ongoing resales, which provide an additional revenue stream and rental upside.
Ingenia has entered into a contract to acquire a mixed-use holiday park consisting of cabins, sites and long-term rentals, operating as the BIG4 Townsville Woodlands Holiday Park. Conveniently located off the Bruce Highway on 6.4 hectares of land, the Park is on the popular drive route from Brisbane to Cairns.
Holiday accommodation includes 22 cabins, 26 ensuite sites and 55 powered and unpowered sites, with approval in place for a further 5 cabins. In addition, the capacity for 55 long-term rentals provides a consistent rent base, underpinning revenue from the Park. Catering to the family market, facilities include a water park, two swimming pools, playground, camp kitchen, BBQs, mini golf and kiosk.
Ingenia is acquiring the Park on an ingoing yield of over 8%, with significant upside identified.
CEO, Simon Owen, said he was pleased to further extend the Group’s holidays footprint in Tropical North Queensland.
“We are seeing strong demand for domestic travel and our holiday parks are benefitting with increased occupancy. BIG4 Townsville Woodlands provides Ingenia with the ability to build upon our presence along
a key drive route and to improve returns through the addition of new cabins, active revenue management and integration to the Ingenia Holidays platform,” Mr Owen said.
Combined with the acquisition of Merry Beach Holiday Park (announced in December 2020), the Group anticipates completing $86.5 million of acquisitions over the next few months and is well progressed with plans to deploy further capital over the remainder of this financial year.
The acquisitions are included in the Group’s FY21 guidance, released on 16 February 2021.
“We retain significant capacity for investment. We are continuing to access quality assets which complement our existing portfolio and expand our rental base and anticipate the Group’s LVR moving to the lower end of the target range (of 30% to 40%) by the end of June 2021,” Mr Owen said.
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