An increasing number of retirement village operators are developing co-located developments with facilities such as golf courses, bowls clubs and other recreational clubs – but these partnerships can come with considerable challenges.
Now law firm HopgoodGanim has compiled a list of key legal considerations for operators when developing the perfect ‘match’.
The firm – which has acted for a number of retirement village operators and clubs with respect to co-location projects in Queensland – says villages should consider whether the risks associated with long-term leasehold tenure (i.e. a lower level of control, ability to lose tenure) are sufficiently outweighed by any commercial up-side in developing and operating a village at the site.
Three options for reconfiguring land
Reconfiguring the land to accommodate the new village is also a key decision.
“Where freehold tenure is chosen, a plan of subdivision will need to be lodged prior to the parcel of land being transferred to the scheme operator,” Amye McArthur and Ivan Orola write.
“Where leasehold tenure is chosen, it can be more complicated. In particular, the grant of a lease of part of a lot for a term of 10 years or greater is deemed to be reconfiguration of land for the purposes of the Planning Act 2016 (Qld) (Planning Act), for which a development approval is required. Accordingly, where the village lease is granted over part of a lot, a development approval for a reconfiguration of a lot will be required.”
Alternatively, it can be possible to reconfigure the freehold parcels to a configuration that sees the village operator take a long-term lease granted over the whole of a newly created lot.
The article also provides a useful overview of a number of other issues including works, financiers’ requirement, regulatory considerations, residents’ contracts and insolvency matters.
You can read the full (lengthy) story here.