Warkworth Oaks Retirement Village, owned by Real Living. Photo / Provided
Private New Zealand retirement village chain Real Living could be sold for more than $400 million, according to industry speculation.
But nothing is confirmed.
Retirement village industry insiders say Real Living is controlled by a
family may be interested in selling, but family is not commenting.
The Australian newspaper reported that entities in that country were interested in the four Real Living villages and that private capital could buy it.
The Murphy family appeared on NBR’s rich list with assets of over $200 million.
Real Living managed and owned Pakuranga Park, Epsom Village, Remuera Gardens and Warkworth Oaks.
The company has listed the Pakuranga property as being on over 30 acres in the heart of East Auckland. This village had 191 independent living villas, 40 independent apartments, 28 serviced apartments and two community centers.
Remuera Gardens is at the end of a quiet residential cul-de-sac, Real Living says.
Epsom is advertised as having parks nearby and looking towards Waitematā Harbour.
Warkworth’s newest village has been described as a place to enjoy a unique retirement community close to the Mahurangi River.
A source said the business was well run with an established balance sheet.
“Pakuranga Park is their big machine,” he said. “They could potentially put up apartments on this site, so it has potential.”
Real Living’s slogan is “retirement villages owned and operated exclusively by New Zealanders for over 30 years”.
When asked why the Murphy family was considering selling at this point, the insider said that Pakuranga Park was founded over three decades ago and the time may be right.
Admittedly, interest in the sector is high with strong returns from listed retirement village companies and speculation that privately held Metlifecare is looking to buy BUPA.
“Like all families, they’re probably wondering where to go from here? I can understand why they might be considering a sale,” the insider said.
Real Living director Chris Murphy has previously expressed pride that the company is family owned and offers a high level of service.
ING originally owned Remuera Gardens and Epsom Gardens before the global financial crisis.
ING sold these two villages to the Murphy family who already owned the large Pakuranga property. The family then expanded by building the new Warkworth development, seeing potential for a retirement village living in this area.
The Australian said Real Living was worth around NZ$400 million “and should attract some of Australia’s leading care home investors at its next auction”.
Forsyth Barr is reportedly working on the sale process and briefing notes have been sent to buyers, the newspaper said. Forsyth Barr has not confirmed his involvement.
Real Living’s annual report filed with the Companies Office last year showed that Pakuranga Park alone generated an annual profit of $22 million before tax. Equity in that village was listed as $176,043,000, according to accounts.
Chris Murphy said Warkworth Oaks was the first retirement village built in that township. It had about 180 apartments as well as a nursing home/hospital.
In 2007, the Herald reported on plans for a new pension company to float on the NZX. The company only owned two villages in Auckland and even those close to the deal described it as a boutique offering.
ING Real Living then announced it would raise $100 million from the public and issue a prospectus, around the same time AMP Capital Investors was seeking $300 million by floating 80% of its Summerset retirement business.
Some analysts and fund managers said the deal with ING was too small to pique their interest and they questioned a proposed related-party transaction between the company and its new chief, the now-late Nick Wevers.
This deal never happened and the Murphy family interests made the deal with ING to expand their business.