Listed land lease, rental village and tourism park operator Ingenia has just released its 2020 Annual Report.
Contrasting the fixed retirement village operator market, the diversified retirement living operator has seen its security price grow from $2.87 to $4.49 or 56% over five years.
With 8,614 income generating sites, they now have 74 communities nationally.
The country’s largest village operator is Lendlease. It also has about 74 villages but around double the number of homes at about 15,000. Their underlying profit is also about the same, around $50 million, and the group values are also about the same at $1.5 billion.
The difference is that Ingenia and land lease communities have far greater cash flow thanks to the fact most of their income is fortnightly rental income, compared to village operators waiting for the resale of homes to capture a DMF profit – every 10 years.
This cash position allows Ingenia and others to fast track growth and return on equity. Ingenia now sits on 7.9% despite heavy reinvestment in new developments, while the large listed village operators are struggling to achieve 5% ROE.
This explains why Stockland has branched out with ten new land lease communities in development.
