Ingenia raises $131m for three new retirement estates
Retirement living trust Ingenia Communities Group has raised $131 million of fresh equity to buy three estates and pump more capital into its Sun Communities joint venture, putting it on the path to a $1 billion market capitalisation.
Ingenia is benefiting from the boost in sentiment in the residential market and ability to snare sites on the outskirts of major cities while some developers remain out of the market.
The company launched a two-for-17 accelerated non-renounceable pro rata entitlement offer to raise $109.8m and an institutional placement to raise $21.3 million.
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The raising at $3.93 per security is underwritten by Citigroup, Goldman Sachs and Moelis.
The proceeds will be poured into expanding the group’s portfolio of lifestyle communities and to provide more equity for the venture with US company Sun Communities.
Most funds raised will be used to bolster Ingenia’s lifestyle and holidays portfolio as it will acquire a total of six assets, including three established communities. The identified acquisitions have a total purchase price of about $102.7 million.
Ingenia picked up a mixed-use metro park community in Brisbane with 150 existing sites as well as another unidentified park on the NSW Central Coast that has 190 homes. It also picked up another park in southeast Queensland that has 200 homes.
All hold development potential and Ingenia also bought land on the NSW north coast where it can build 100 homes adjacent to an existing lifestyle development.
Ingenia CEO Simon Owen. Picture: Tim Marsden
The company will also expand Ingenia Holidays Rivershore on the Sunshine Coast by about 80 holiday sites and its joint venture picked up a parcel on the NSW Central Coast that could have 400 homes.
Once the deals are completed it will lift Ingenia’s weighting to the east coast and its lifestyle portfolio will span more than 8500 income-producing sites with 97 per cent in coastal and metropolitan markets.
Ingenia chief executive Simon Owen says the acquisitions confirm the company’s position as a sector leader in lifestyle communities, adding the company is focused on asset clusters in key metro and coastal markets.
The raising leaves the company with capacity to fund growth while keeping fiscal 2020 earnings guidance steady.
“Our pipeline … is continuing to progress a mix of yielding and growth opportunities and we are confident of our ability to execute on further transactions to deliver future growth,” he says.
Ingenia has sites under conditional contract on land next to Ingenia Holidays Rivershore, a greenfield parcel on the NSW Central Coast with the potential to create a lifestyle estate.
Other sites are under due diligence including a metro mixed-use community in Brisbane and coastal lifestyle communities in NSW and Queensland.
Ingenia’s balance sheet acquisitions will cost it about $86 million, with a further $16.7 million to be deployed in the joint venture with Sun Communities.
Combined, these acquisitions include 540 income-producing sites and 640 potential development sites, building the company’s development pipeline to 3873 potential new homes.
This article originally appeared on www.theaustralian.com.au/property.
