The freehold going concern in Omaha Rest Home, near Warkworth north of Auckland, has been placed on the market for sale; offering buyers an opportunity to enter a growing industry backed by strong demographic trends.
The land, buildings and business are all offered for sale in the 33-bed facility, at 582 Leigh Road, Whangateau. It is being marketed by Roger Seavill and John Davies of Colliers International and is for sale by deadline private treaty closing at 4pm on Thursday August 9 2012, unless it sells before the deadline date.
Seavill, who leads Colliers International’s nationwide special projects team, specialising in properties outside the traditional office, retail and industrial commercial property sectors, says ‘aged care’ properties and businesses constitute a compelling investment proposition.
“It has been well documented that New Zealand’s population is ageing at a significant rate, which is placing high levels of demand on aged care facilities. We are seeing an associated increase in demand for aged care investment properties, as buyers recognise the demographic trends at play which should ensure existing rest home businesses are viable as long term, income generating investments.”
Property and location
The 2.5ha property occupies a picturesque, elevated rural setting with sea views from some parts of the extensive site, Davies says. It houses a 660sq m care facility offering a mix of rest home and dementia care across 29 rooms.
“The property was originally constructed in the 1930s and was originally a house. Subsequent alterations and additions, most notably in the 1980s and 1990s, have resulted in a purpose-designed multi-level rest home and dementia care facility.”
Omaha Rest Home provides 20 single and double rest home beds and nine single and double dementia care beds. A foyer area, office, staff room and administration area are located inside the main entrance, with multiple further communal dining, lounge and laundry rooms spread throughout the property. Other facilities on site include a hairdressing salon and outdoor deck.
The site has a road frontage of 68m and includes undulating, bush and pasture-clad land which could be used to expand the rest home facility with the appropriate consents, Davies says. “With consents in place, there is a substantial opportunity here to extend the existing building and significantly increase the number of beds to meet forecast market demand.”
Omaha Rest Home is located within the rural area of Whangateau, situated approximately 17km to the north east of Warkworth and 5km from Leigh. Omaha Beach is located to the south, approximately 7.5m away around Whangateau Harbour.
New Zealand’s ageing population
New population projections from Statistics New Zealand, released this month, show that substantially more beds in rest homes and hospitals will be required across the country in the future, Seavill says.
“New Zealand's population aged 65 years and over is projected to exceed 1 million in the late 2020s. According to the new projections, one in five New Zealanders will be aged over 65 by the late 2020s.”
The data also show that the number of people aged over 65 will exceed the number of children aged under 15 years. Currently, there are 600,000 people aged 65 plus and 900,000 children in New Zealand.
“Significant changes in the median age of New Zealand’s population area also expected,” Seavill says. “The projections show that the median age is likely to exceed 41 years by the late 2030s. This is in comparison to a median age of 37 years today, and 26 years in 1971.”
The population’s gradual ageing reflects the combined impact of people having fewer children as well as the “baby boom” generation reaching retirement age, according to Statistics New Zealand.
“Given that the majority of new entrants to rest homes and continuing care hospitals are within the 80 years plus category, data indicates that there will be pressure on aged care facilities, presenting a compelling investment opportunity in the aged care property sector nationwide,” says Seavill.
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