Stockland ‘cools’ on buying land lease operator Halcyon

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Residential property developer Stockland is reportedly out of the frame for the purchase of Queensland land lease community operator Halcyon.

Halcyon, founded in 2004 with nine land lease communities across South East Queensland, has hired financial advisory group Rothschild for a sale and is in the final stages of the competition.

The Australian reported that Stockland, advised by Moelis, made it through to the final round, along with the ASX-listed Ingenia, who are advised by Jarden. We reported on 1 June that land lease community business Serenitas was also bidding for Halcyon.

A market expert said a challenge for major groups like Stockland or Mirvac Group bidding for such a portfolio is that the $600m-plus price tag places a large valuation on the company’s intellectual property, and both groups do not need the IP because they can develop it themselves.

Halcyon has won more than 20 industry awards and is the largest listed player in the manufactured housing estate market.

Yet its valuation of “north of $500 million” appears ambitious when Canadian investment fund Brookfield paid $1.29 billion for Australia’s only ASX-listed pure retirement village operator Aveo back in August 2019.

Brookfield acquired 96 communities with approximately 12,000 homes, 200 aged care beds and a pipeline of 5,000 village homesites and 670 aged care beds.

Final bids for Halcyon and a possible life-changing payday for managing directors Dr Bevan Geissmann and Paul Melville (pictured) are due about 25 June.