It is on their website for the previous half year. The annual report will be their on the 24/3/14.
http://www.summerset.co.nz/assets/In...RT-2013-v4.pdf
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It is on their website for the previous half year. The annual report will be their on the 24/3/14.
http://www.summerset.co.nz/assets/In...RT-2013-v4.pdf
If summerset were to sell a village;
If a prospective buyer was to purchase a village and start a business on similar aged care residential contract terms then their valuation would be based on the net present value of forward aged care residential free cashflows, plus revaluations of assets (structures) within the sector market.
If a prospective buyer was going to convert the village into residential property apartments, then the valuation to them would be the sum residential property market valuation of the apartments. But, this is why their bid would fail, it’s not a value added competitive offer.
How then to value a village;
What is not entirely provided to us, and yes I read the reports too, is absolutely all the criteria the valuer's apply in assessing fair value movements.
The valuer's criteria must surely apply the supply and demand expectations of prospective village purchasers.
Let’s face it, Mum, Dad and the kids or others in the residential property market are never going to buy an aged care retirement village are they.
It’s the prospective pool of potential village owner operators that determine supply and demand and therefore village valuation.
And, it would seem there will probably be quite good demand for a few years ahead.
You need to have another read of the report my friend.
Underlying profit, or another name for it is core operating profit already strips out revaluation gains either up or down. i.e a $20m brownfields reduction in capital value would still leave an underlying profit exactly the same as the underlying profit that was reported on Tuesday. In that report you'll see that realised development margins are set to improve in the 2014 calendar year with all developments now being managed in house and that with 250 units being built this year, an increase of just on 25% that will be a major driver behind profit growth in 2014 and will the realised development margin on 300 units in 2015 :)
Mac's point about being a service provider is bang on the money in my opinion.
I have some experience of residential valuations from my time investing in property and can say with some certainty that valuing property is at best an imprecise science. Assuming commercial is similar, I wouldn't read too much into the RE valuations even if done by the same company YOY.
I tend to agree, it's more about supply and demand.
Am I missing something? Not just this forum (eg post 1389) but just about every online and other media discussion mentioning 'supply and demand' seems to focus almost exclusively on demand, and to overlook cost of supply. Not totally sure my distant memories of stage one economics are correct, but doesn't a fall in the marginal cost of supply move the supply curve, and therefore the price? So in the case of retirement villages, assuming a truly competitive market, wouldn't a fall in land prices make it cheaper to supply new ones and therefore reduce their market price?
Did you know that Judge Judy was convicted of insider trading and sent to jail?---oh no wait ,that was Martha Stewart----It always amazes me how these posts can stray:)
Can you imagine being the one to have to care for her? OMG