Ryman to spend more than $100m on second Melbourne village
Ryman Healthcare [NZX: RYM], which last week reported a 43 percent boost in annual profit, has secured a site for its second retirement village in Melbourne, which it expects to spend more than $100 million to build.
The Christchurch-based company purchased a 5.5 hectare property in Melbourne's eastern suburbs from the Victorian government as part of the state's surplus land programme, it said in a statement. The former Brandon Park Secondary College site will be redeveloped into a retirement village for 400 residents, including residential aged care amenities and dementia care.
"It's a site we've had our eye on for a number of years," managing director Simon Challies said. "We're delighted to have secured it."
The company had cash and equivalents of $1.8 million as at March 31, with undrawn bank facilities of $222.4 million.
Ryman expanded into Australia with the first residents moving into its Wheelers Hill village earlier this month, and signalled the latest acquisition when reporting its annual earnings last week.
Like other retirement village developers and operators, Ryman is looking to latch on to an ageing demographic, and it increased its annual building target to 850 beds and units a year in New Zealand by 2017, from a rate of 700 a year.
Ryman owns and operates 27 retirement villages housing 7,500 residents.
The shares dropped 3 percent to $8.44 yesterday, and have gained 7.5 percent this year. The stock is rated an average 'hold' based on five analyst recommendations compiled by Reuters, with a median target price of $8.25.