Ambitious expansion plans revealed by Ryman in flat market
Friday, 24 May 2019
Ryman Healthcare will build new retirement villages in Auckland, Christchurch and Melbourne regardless of a flat residential property market.
Chairman Dr David Kerr revealed the plans when announcing the company's latest operating profit for the year ending March 2019, which was ahead 11 per cent on last year at $227 million.
In Auckland, Ryman is planning a new $150m village for 300 residents at Kohimarama next to Selwyn College.
In Christchurch the company has bought land from Ngai Tahu at Riccarton Park, and has also bought Anglican Care's earthquake-damaged Bishopspark Retirement Village on Park Tce overlooking Hagley Park for redevelopment.
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The new Kohimarama village in Auckland will create 120 permanent jobs when completed. The 137-year leasehold site with perpetual rights of renewal was bought from a third party and is owned by Whai Rawa Property Holdings, part of Ngāti Whātua Ōrākei.
Ryman is asking for naming suggestions - it names villages in honour of well known locals, such as Edmund Hillary, Grace Joel, Evelyn Page, Bruce McLaren and Possum Bourne. Residents have just moved in at Murray Halberg village in Lynfield, and William Sanders village in Devonport.
In Christchurch where Ryman was founded in 1984, the villages at Riccarton Park and Park Tce will be worth more than $220m and provide long term jobs for about 370 people.
Remaining residents at soon-to-be-redeveloped Bishopspark will be offered homes elsewhere by Ryman.
A 10th Australian village valued at about $200m is planned for the Ringwood East suburb in Melbourne near Eastland Shopping Centre and promises 120 permanent jobs.
Ryman land bank allows for 7000 beds and units at 20 new villages either under development or in the planning and design stages.
'We are rolling out new village hosting services, a new meal service for independent residents, and a new approach to dementia care,' Kerr said.
'We are also trialling a taxi and car sharing service, an electric car charging network in Auckland and new generation solar-powered townhouses.'
The property market during the year had been flat but the company only had 1 per cent of resale stock available, and care occupancy remained above 97 per cent, above the industry average of 87 per cent.
'We will continue to monitor the market closely – we have been in business for 35 years and through many cycles before,' Kerr said.
Ryman invested $552m in new and existing villages during the year, taking net assets to $2.2 billion, up from $1.9b a year ago.
While the operational profit from care and management fees was higher at $227m ($203m in 2017), the final after-tax profit of $326m was lower than the previous year's $388m.
This was due to a smaller increase in unrealised property values of $102m compared with the previous year's $185m.
The number of new sales of occupation rights was lower at 414 (458) while resales were the same at 824.
Ryman will pay shareholders a full year dividend of 22.7 cents a share.
Chief executive Gordon MacLeod said March had been one of the busiest months for property.
Other highlights included record staff engagement, and the best clinical audit results in the company's history, with 81 per cent of care centres achieving gold standard four-year Ministry of Health certification.
Ryman was named the Most Trusted Brand in the aged care and retirement village sector for the fifth time, and its myRyman application won a top accolade at the 2019 Asia Pacific Eldercare Innovation Awards in Singapore last week.