News
31 May 2022
Arvida booms along with Ryman and Oceania
A third retirement village company has recorded big profits and ambitious expansion plans.
Arvida has told the Stock Exchange that it earned an underlying profit of $73.5 million for the full year to March, up 42 percent on the preceding year.
This result followed similar rises revealed last week for Ryman Healthcare, whose profits rose 13.6 percent on a year earlier and Oceania Healthcare, whose profits rose 16 percent on the previous year.
Both companies unveiled a range of other positive financial figures and growth projections.
In the latest report to the Exchange, Arvida said its gross proceeds from new sale and resale units rose to $325.2 million, up 44 percent.
Its portfolio of 5456 units and beds across 35 retirement communities grew 25 percent over the year.
Two parcels of greenfield land were acquired during the year at Waikanae Beach and Te Awamutu, and the pipeline for future developments comprises 1928 units.
Project your fortnightly, tax-paid income.
The profitability of companies like Arvida, Oceania and Ryman is generally credited to rising real estate values, and the fact that entry prices for units in retirement villages have now gone up to match real estate values generally.
Even though property prices overall have dipped in the past few months, they are still at the level they were a year ago and almost double what they were five years ago.
And the 15 percent drops in house prices that are sometimes quoted in the media generally refer to sales that vendors need or strongly want to make.
Optional sales often get put on hold when prices are weak.
Around 47,000 New Zealanders live in retirement villages. However, that still amounts to just 14 percent of the population of people over the age of 75.
Many of the most popular villages have long waiting lists, and that fact is expected to give unit prices in retirement villages a degree of buffer from the full impact of lower real estate prices in the community at large.
Written by:
Eric Frykberg
Semi-Retired, Eric worked in journalism for 45 years across print, radio and television, in New Zealand, Australia and Britain. He has specialised in business, finance, energy, mining, transport and agriculture. He was also foreign correspondent for RNZ for many years. He can be reached on ericf25@hotmail.com.
Invest with Lifetime for a retirement income managed for living.