18 months after leaving Australian Unity saying he had “energy for another challenge”, Derek McMillan has teamed up with former Australian Unity CFO Tony Connon to re-enter the retirement living market.
Speaking exclusively to The SOURCE, Derek said that his new organisation will focus on retirement villages that offer both independent and assisted living options for residents.
Centennial are joined in the new venture by Qualitas, a leading real estate financier and investment manager established in 2008 with around $2 billion of committed capital – a vote of confidence in the sector according to Derek.
“We have investors coming in and out of projects but to have Qualitas come in – it’s great for the sector overall and for other investors to take another look.”
For their initial portfolio, Centennial Living and Qualitas have entered into an agreement to acquire three Stockland villages – Burnside Retirement Village, Taylors Hill Retirement Village and Keilor Retirement Village, all in Melbourne’s north-west with a total 649 units – for $59 million.
Derek tells us the Centennial team met with residents last Thursday on the day the venture was formally announced. Their goal now is “not to break anything” he says, but work towards implementing a service model for assisted living at the villages.
Derek says residents are increasingly looking for access to additional services to avoid moving into residential care.
“We want residents to stay in the village for the rest of their lives. If we achieve that, that would be a great goal,” he said.
Derek adds that the increasing availability of Home Care Packages (HCP’s) means retirement village operators should be able to provide home care services more effectively rather than have a range of providers coming into the village.
Centennial and Qualitas are also actively seeking to grow their portfolio by acquiring mature villages in NSW, Victoria and South Australia.
“10 villages would be a good solid platform to think about what the next steps would be,” Derek said.
“Our plans are obviously more optimistic than 10, but if we can get to 10 to a similar scale of over 2,000 units, that’s a good size to prove up the model.”
Watch this space then.