Asking $810 a week to cover all living costs including meals, cleaning, electricity and home insurance (plus rental accommodation), American operator Harvest Developments has captured sites in Kellyville in Sydney and Harbour Quays on the Gold Coast to make their beachhead here in Australia.
The resident has no other costs – including no bonds or exit fees – giving them all their capital to live on, as long as they can ‘pay the rent’.
Harvest has joint ventured with Australian partners Petrac and Valad. They plan to have 10 villages in progress within 2 years with the base model being 130 apartments each. They are targeting the 75+ market.
$810 equates to $42,000 per year. If the average occupancy is 8 years then in today’s money the commitment is $336,000. The comparison is a traditional ILU at say $350,000 with a 3% DMF and $100pw fee which will cost $136,000 over the 8 years – exactly $200,000 less or $25,000 a year.
In America Harvest has 38,000 apartments rented.