Thanks for sharing this and it is interesting what he says.

Although it is true what he says regarding care units being substantially less profitable, ARV does have a substantial number of independent apartment units as well, so it is not solely care based, as the article would imply. It could also benefit from potential economics of scale and synergies of bring many villages together, therefore lowering costs per person in care, and improving the margin, although this is still not going to be anywhere near as profitable as license to occupy I realize.

ARV is also actively looking for other high quality villages, that will increase EPS and dividends per share (like Aria villages did), which will also further boost economics of scale and synergies.

From a more macro point of view, What people seem to be missing in the whole retirement sector, is that increasingly people are living longer (less turn over = less profit for the licence to occupy, and more people needing care as they get older - ie care beds). ARV is well placed to capitalize on this, having quite a few care beds, while other retirement villages could fail to meet these ambitious growth plans, some have even pointed out there could be a short-medium term oversupply of villas.

Aside from this, old people are getting more tech savvy (accessing forums such as this) and realizing just how much money these big retirement villages are ripping them off by, this combined with a potential oversupply will force those who are heavily exposed to having to sell villas into potential discounting, or other benefits (for example buy a licence to occupy off SUM instead of MET as they offer a fixed fee for life - this has already happened and now pretty much all villages have this - lets hope inflation doesn't take off right?) Where are the discounts/benefits going to come from next? ARV doesn't have to worry about this potential intense competition and has a higher % occupancy, further increasing benefits.

Anyway, this is a very 'big' look at the picture and ARV is a long term game for me, with short term benefits (ie the dividend). SUM may be the stay this year, but in a decades time potentially not so much. Ryman could be the only village I would consider selling ARV for (if it gets back down to a more fair value of around $6), as they will also continue to do well as I know they have a strong care focus.