Westpac lending more for retirement villages than aged care

Published on

Over the past three years Westpac has been receiving applications and making funds available to retirement village developers at a higher rate than it has been funding residential aged care developers.

To appreciate this scale of funding now passing through the village and care sector, in 2019 aged care invested $5.6B in new builds and refurbishment, according to government records.

Louise Johnston, Director – Health & Aged Care at Westpac (pictured), told us at a private lunch in our office that they have over $2 billion in funding in the sectors at any one time and that the sectors are vitally important to the bank as a lending business.

Ciaran Foley (pictured), CEO of Allambie Heights Village in 17.5km northeast of Sydney’s CBD, also at the lunch, had that morning won approval for a new village extension.

Discussing village demand over the weekend with Jim Hazel, Chairman of Ingenia, he believes villages are entering a golden decade as operators embrace independent living with care and as a new breed of management emerges out of events like the sale of Stockland and the emergence of Not For Profit giants like Bolton Clarke and Calvary.

But as Louise pointed out, the banks are keen to lend, but only when experienced executives are leading the operators. And their number are limited.

Interesting question: who will be the new CEO of the Stockland portfolio of villages now owned by EQT? Will they import a New Zealander, given they EQT owns Metlifecare and see the NZ model as the future?