Scape Australia CEO Stephen Gaitanos has praised the leadership of retirement living operator Aveo, following its acquisition by The Living Company – Scape’s parent – for $3.85 billion, in what is now the largest direct real estate transaction in Australian history.
Speaking at the Mingtiandi Singapore Forum in May, Gaitanos said Scape’s strategy has always been to acquire “the best team with the best assets” when entering a new sector.
“Aveo is a fantastic business, run by a fantastic management team,” he said.
The deal, announced last Thursday (26 June), sees The Living Company take ownership of Aveo’s 65 retirement communities comprising more than 10,000 units, with a development pipeline of over 3,000 additional homes.
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The transaction will also mark a shift in Scape’s structure with its various living sector platforms – student accommodation, Build to Rent and now seniors living – all being consolidated under The Living Company brand.
From turnaround to transformation
Brookfield Asset Management acquired Aveo in 2019 for $1.27 billion in partnership with Mulpha International, which retained a 15% stake. At the time, the portfolio included 96 retirement communities, approximately 12,000 homes, 200 aged care beds, and a pipeline of 5,000 village home sites and 670 aged care beds.
Brookfield Co-Head of Real Estate Australia Ruban Kaneshamoorthy said the firm took a “contrarian view” when it first invested in Aveo.
“We identified a challenged platform that owned great real estate and this allowed us to execute an operations-driven turnaround,” Ruban said.
“In partnership with the Aveo management team, we invested heavily in the business and executed a business plan that moved Aveo from a platform with a lack of focus and direction to a high-performance, resident-first organisation. It’s now well placed to take advantage of the strong demographic and structural tailwinds underpinning the retirement living sector.”
Streamlined and focused
Under Brookfield’s ownership, Aveo was repositioned for growth. Former Lendlease Retirement MD Tony Randello was brought in to lead the business. Over the next five years, Aveo exited residential aged care through a strategic partnership with Opal HealthCare and divested non-core assets:
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~1,000 units were sold to Eldercare and Resthaven in South Australia (both part of the UnitingCare Australia network);
- 340 units were acquired by Teman Group; and
- Three additional communities were decommissioned and sold to the Queensland Government.
These moves were part of a deliberate strategy to sharpen the business’s focus on retirement living.
Greg Shaw, CEO of Mulpha International Bhd, welcomed the new transaction: “The business has thrived under Brookfield leadership and an exceptional management team. This transaction will set the foundation for further growth supported by favorable macro tailwinds.”
