Two relatively small investment grade land lease communities just outside Melbourne’s outskirts have been listed.
At Grantville and Healesville, the managed properties are each expected to sell for over $13 million – a guide the agents say puts them on the radar of high-net worth individuals and syndicates as well as the usual institutional players.
Sydney’s Equinox Group is the seller; both properties come with options to extend on land it has an agreement to control.
Booming sector attracting new players
Also known as manufactured home estates, LLC operators derive income renting land on which a resident pays for a permanent, movable dwelling.
They are increasingly being created out of tourist/mixed use holiday parks, Mr Peluso said, adding the model attracts seniors, sharing similarities with aged care projects containing independent villas.
Elsewhere in regional Victoria, Hastings’ Peninsula Parklands, with 191 occupied homes over 5.8 hectare, traded in June, 2022, for $33.25m – a 4.4pc yield.
Ocean Grove’s Collendina Caravan Park – covering 29.5ha with 328 cabins/sites – also traded that year, in May – the $35m result a 4.5pc return.
In 2020 meanwhile – a campaign launched a month into the national lockdown – Inverloch’s Sunny Sand Residential Village collected c$3m, reflecting a c5pc return, from an investor. On two hectares at 32 Ullathornes Rd, that asset contained 57 dwellings.
The Equinox listings come three months since Mirvac made its maiden investment in the LLC sector, with Pacific Equity Partners outlaying c$600m for a 47.5pc stake in 27 Serinatas branded LLCs with 4200 sites and 2000 in the pipeline.
Tasman, which controls an interest in the Serinatas portfolio, is a significant private investor in the sector.
Enclave at Healesville
At 322 Don Road, Badger Creek, Enclave at Healesville contains 71 dwellings, 44 of which are retirement sites (story continues below).
On 2.6ha, it also contains a manager’s residence, BBQ area, community hub, function room, playground, shed and storage.
Any incoming owner will have the option to buy a 4000 sqm site – 308 Don Rd – allowing for c18 more permanent homes.
Presently, the annual income is $777,000.
The median house price in Healesville, 64 kilometres east of Melbourne’s CBD, has increased 20pc since the pandemic, the agents added.
Waterfront Grantville site
The Grantville asset meanwhile, Frenchview Lifestyle Village, spreading 1.46ha at 22 Pier Rd, contains 104 permanent and village lots, all but two of which are occupied, a BBQ area, pool, boat and car bay wash and community centre.
A bulk of dwellings have only been recently completed; the asset’s annual income is $663,617.
More homes could be considered on a parcel of land owned by council which Equinox has a leaseback option over.
Grantville, a c100 km drive south east of Melbourne and 35km from Phillip Island, forms part of the Bass Coast, with a fast growing permanent population – presently about 30,000 according to council, trebling over holiday periods.
Sector to mature in line with population
The country’s ageing population – between 2011-2021, Australia’s old age dependency ratio doubled in comparison to previous decades – will support the viability of the LLC sector, Mr Peluso said.
By 2031, some 29pc of the population will be retirement age, up from 21pc, he added.
“Increasing cost of living challenges across capital cities are forecast to further catalyse demand for affordable retirement living options above and beyond this already clear demographic need,” according to the executive.
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