Record sales post-Covid-19 lock down for retirement village operator Summerset

Monday, 12 July 2021

Retirement village operator Summerset Group has posted its highest sales of occupation rights for units and apartments in a half year in its 23-year history.

Summerset recently officially opened a new village, Summerset at Pohutukawa Place in Bell Block, New Plymouth.

Summerset chief executive Scott Scoullar said the 270 sales of occupation rights for 154 new units and 116 existing units was a record for a second quarter, April to the end of June 2021, following on from record sales for a first quarter in the January to March 2021 period.

The 545 sales achieved in the six months to June 30, 2021 was the best half year in the company’s 23-year history. It was 50 per cent higher than any other first half before the emergence of Covid-19.

The company could be heading for a record year of sales if demand and the sales momentum continued. Last year Summerset hit 785 total sales of occupation rights.

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Summerset chief executive Scott Scoullar says the company is building 500 to 550 new units, apartments and suites in 2021.

* Housing shortage creating lack of retirement accommodation

* Record sales for Summerset in first quarter 2021 continues post-lockdown robust sales trend

* Booming property market for retirement village operator Summerset

“Post-Covid we are seeing an increasing volume of people wanting to come into a village,” Scoullar said.

The company was building to meet the consistently strong demand for units from the country’s older population seeking the security, safety and companionship of a retirement village.

It expected to build between 500 and 550 units, apartments and suites for occupation right sales and another 100 care beds in 2021.

The company expected sales in the second half of the year to be “marginally lower” because more than half of the new units being delivered in the second half would be serviced apartments, care suites and dementia suites which usually took longer to sell than independent-living units.

“Demand continues to be strong for both new sales and resales. We have seen good diversification of sales across the country with 70 percent of new sales coming from four villages: Casebrook in Christchurch, Ellerslie in Auckland, Rototuna in Hamilton and Te Awa in Napier.”

Summerset had pre-sold all independent-living units being delivered in the third quarter at the Bell Block in New Plymouth, Hobsonville in Auckland and Te Awa villages, as well as 80 percent of those available at Rototuna.

Summerset is one of the big six retirement village operators with 32 villages operating and in development.

Real estate consultants JLL monitor the building and expansion of the retirement village industry.

JLL managing director Todd Lauchlan predicts demand for villages will continue to increase and questions if there will be enough units in the future to meet demand.

“We are forecasting a stronger demand than we have ever seen and the market is going to have to catch up,” said Lauchlan.

JLL data predicts that if current rates of demand continue, there will need to be 26,000 more retirement village units built than are currently predicted to be built by 2033.