We continue our of the key points made by a selection of 20 CEOs from both the not-for-profit and private sectors who presented at the inaugural LEADERS SUMMIT three weeks ago.
Mike Bosel, CEO, Eureka Care Communities - Making the rental model a successful formula
Eureka Care Communities is achieving success with the rental village model whilst most others have struggled. Mike Bosel has rebuilt the Eureka properties to generate industry-leading returns.
Eureka Care Communities manages its own rental villages plus offers services to other sector participants
cash returns vary between 8.25% and 11.4%p.a.
Current occupancy 85%+
Rental model includes accommodation, food and some services
Eureka offers weekly rental agreements - delivering resident freedom
average resident: aged 80+, single, female and homeowner
average stay, three - four years
major sectors challenge: value as understanding of the rental model
the future: very bright, driven by low new rental model constructions Vs increasing demand, plus age of current rental model operations
John Ireland, CEO, Southern Cross Care - another not-for-profit elephant in the room
John Ireland is typical of the sophisticated managers of not-for-profit retirement village and aged care businesses that are successfully building large assets, providing tailored housing to the wealth of residents, while still delivering envied balance sheets. The quiet but at times explosive growth of not-for-profits sets the pace for the private sector.
in 1990 SCC had six facilities, 70 staff and a $2 million overdraft
in 2010 SCC has 35 facilities, 1300 staff and $130 million in the bank
up to 25% of residents are getting subsidized accommodation
replicating the McCrindle Research result, the SCC research and experience confirms that people move away from the concept of joining a village as they age
SCC is driven by the charitable business principles of inclusiveness, support, autonomy and quality
