SUM - Summerset Group

[dobby41]

You could make the case there already is. If my Mum had of invested the capital she released when she moved into a retirement village 9 years ago into RYM shares for example, she'd have done very nicely indeed. I think Diana deliberately and disingenuously minimized the importance to most folk that this capital release through the natural down-sizing of accommodation confers. In many cases the retirement unit is about 60-75% of the value of the house sold but this capital release is really important to the average resident of about 80 who's moving into a retirement village. Often this is the most liquid amount of money people have had in their entire life and they're able to have a world trip and a new car while they're still able to enjoy them, things that often they've never been able to do in their lives before. Other times the capital is used for elective surgery so the pain of having to wait on a long waiting list is eliminated. Often the capital is invested and the proceeds used to minimize the weekly fee so the elderly person is often staying there free of any weekly fee or at a deeply discounted level.

My Mum and Dad got no capital release - basically sold their house and paid it all to the village.
Fine by me - I wanted them to do it as it was the right thing to do (and I don't expect or need an inheritance).
So Mum pays fees etc. Your use case is not, by any means, universal.

I brought Ryman many years ago (and the others since) because I could see that farming the elderly would be very profitable.
I may not agree totally with the business model but have done very well out of it.
If you can't beat them, join them!

[Beagle]

"If got to be good enough for Mum" is the fundamental basis upon which RYM and SUM were established. Some people have forgotten or have never been aware of (including Diana Clement) what sort of facilities were around before RYM and others started building nice ones. I maintain the elderly have a very valuable choice now that they previously didn't have. Choices are always a good thing especially when they dramatically improve one's lifestyle. Whether this amounts to "farming the elderly" as Diana Clement puts it or providing a wonderful lifestyle retirement option for people who choose to enjoy it while giving a good commercial return to investors, is the debate that will be enduring. There will always be a small percentage of kids that are annoyed that they will be inheriting less but I choose to believe that most are happy that their parents are happy because I know I am and its on this basis that I have no moral qualms whatsoever about being an investor in the retirement sector.
Nobody has a gun to anyone's head making them move in and prospective residents face a mandatory requirement to take independent professional advice before choosing, you can't get fairer than that.

[percy]

People forget how bad the industry was when it was run by not for profit organisations.
The dark ages.

[Beagle]

People forget how bad the industry was when it was run by not for profit organisations.
The dark ages.

Exactly Percy...or like some reporters they have no idea in the first place. About this time last year I spent half a day at the Summerset Hobsonville village. Everyone I met there seemed very contented and there was a very good atmosphere about the place.

[dobby41]

I maintain the elderly have a very valuable choice now that they previously didn't have. Choices are always a good thing especially when they dramatically improve one's lifestyle.
.
.
Nobody has a gun to anyone's head making them move in and prospective residents face a mandatory requirement to take independent professional advice before choosing, you can't get fairer than that.

I just think it would be interesting to see what happens if there are other choices - like the Australian one where the elderly share some of the future gain.
I'm not saying that the villages and the contracts are bad but I do wonder if the contracts could be better.

Enough with the guns - I get it!

[Beagle]

I just think it would be interesting to see what happens if there are other choices - like the Australian one where the elderly share some of the future gain.
I'm not saying that the villages and the contracts are bad but I do wonder if the contracts could be better.

Enough with the guns - I get it!

No guns just a good debate mate. I would think some retirement villages wouldn't mind sharing the capital gain if retiree's shared the initial capex cost of establishing all the common area's and facilities as well as the cost of maintaining them. Bottom line is SUM make nothing from running their villages and if it weren't for the current model they wouldn't be able to afford all the lovely village facilities your mother and mine enjoy. This is the inconvenient truth that Diana Clement rather conveniently overlooks. 96% satisfaction rate speaks for itself. https://www.summerset.co.nz/living-a...nd-activities/

[winner69]

Julian will be pleased the property market still chugging away nicely
http://www.sharechat.co.nz/article/5...g-turnoverhtml

Will keep the development margins up and will be making a bit more on resales will this continues

Beagles $100m plus for F19 is now $100m plus

Good for the moment Orr keeping the OCR down and even hinting at cuts ....but we’ll suffer big time in a year or two when he realises he has been way too ‘cautious’

[Beagle]

$100m underlying profit is looking pretty comfortable. Cost of construction, the level of new migrants and low interest rates are all supportive factors medium term and then there's the long term demographic trends which we all know so well. I for one am not worried at all if they hit the go slow button on Australian expansion.
Melbourne prices down year on year 5%. I am greatly encouraged by recent disclosure of healthy development margins as I thought after last year's ripper development margin expansion they might have come under pressure a little. Looks like the development team at SUM are further refining their strategies which augers very well indeed for the long term.

[oldtech]

Summerset's application to build a seven-storey, 344-unit retirement village on a 2.6ha site in St Johns, Auckland has been declined.

https://www.nzherald.co.nz/nz/news/a...ectid=12098002

According to the article, the height limit is three storeys. I wonder if Summerset will try to get a lower village through - say four or five storeys? Or would the numbers be uneconomical?

*Edit: Or they may appeal the decision I suppose

[LAC]

Summerset's application to build a seven-storey, 344-unit retirement village on a 2.6ha site in St Johns, Auckland has been declined.

https://www.nzherald.co.nz/nz/news/a...ectid=12098002

According to the article, the height limit is three storeys. I wonder if Summerset will try to get a lower village through - say four or five storeys? Or would the numbers be uneconomical?

*Edit: Or they may appeal the decision I suppose

Oh damn, someone must have gotten the requirements of the area before wanting to go with 7 stories....