Summerset green-lights $130M Ellerslie village after consent approved

Friday 8th August 2014

Summerset Group, New Zealand's third-largest listed retirement village operator, will develop a $130 million village in the Ellerslie suburb of Auckland to accommodate 400 people after being granted resource consent.

The 3.8 hectare village will include 250 units, including townhouses, villas, apartments, and care apartments where residents can receive rest-home level care in their homes, as well as an 80-bed care centre providing rest home and hospital-level care, the Wellington-based company said in a statement. It had previously announced that it was waiting on consent for the project.

Summerset Group said Ellerslie, in east Auckland, lacks retirement villages and the project will bring its investment in Auckland village development to $500 million. It has completed a village at Manukau and is close to finishing a village at Warkworth. Earlier this year, the company started work on a $70 million village at Karaka and a $120 million village on the waterfront at Hobsonville.

"Summerset has seen homes snapped up in its other Auckland villages, and welcomed first residents to villages at Karaka and Hobsonville recently," chief executive Julian Cook said. "Sales of occupations rights in those villages have been strong, with stages released early due to demand."

Retirement village companies are acquiring land and preparing for a record building spree in anticipation of increased demand as people born in New Zealand's post-war era start to reach the target age for operators, including Summerset and its larger rivals Ryman Healthcare and Metlifecare.

Summerset has a landbank equivalent to 2,116 village units and 595 beds set aside and estimates the percentage of the population aged over 75 will rise to 10 percent by 2031 and make up 14 percent by 2051, from 6 percent in 2011.

Shares in Summerset were unchanged at $2.97 shortly after the market opened at 10am, and have shed 8.6 percent so far this year. The stock is rated an average "hold" according to analysts polled by Reuters.

BusinessDesk.co.nz

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