Last week, well-known real estate investor GreenFort Capital has entered into a joint venture with private equity firm Gaw Capital Partners to acquire and develop a $600 million pipeline of retirement living projects.
Under the arrangement, GreenFort plans to grow its retirement living business, Reside Communities, to 1500 units across the east coast of Australia.
GreenFort partners Adam Vaggelas and Nick Singleton – both formerly of Blue Sky Alternative Investments – and Scott Hyndman established the Reside Communities business last year, bringing in former Retire Australia senior executive Glen Brown as CEO.
Mr Vaggelas said Australia’s rapidly ageing population and lack of quality retirement living supply represented a significant opportunity.
“The 65-plus age group is forecast to almost double over the next 20 years. With retirement living occupancies at 90 per cent across the country and the average retirement living facility almost 25 years old, we see a compelling opportunity to supply unmet demand for quality, well-located product,” he said.
President and managing principal of Hong Kong-based Gaw Capital Partners Kenny Gaw said Australia’s retiring Baby Boomer generation provided a strong foundation to build the business into the future.
Since formation, Reside has acquired a 5.5-hectare parcel of land in Samford Village near Brisbane with 27 existing independent living units and scope to develop another 120. The group has also purchased an existing 121-unit retirement facility on a 4.8-hectare site in Robertson, in Brisbane’s south.
The long-term fundamentals for the sector are supported by the demographic trends. The federal government’s Australian Institute of Health and Welfare forecast that the portion of the population aged over 65 will increase from 15 per cent in 2017 to 22 per cent around the middle of the century, taking the total number of over-65s from 3.8 million to 8.8 million.