Retirement village operator, ING Real Estate Community Living Fund has booked an interim net profit of $15.6 million for the six months to December 31, 2006 – up 215% from $4.95 million in the December 2005 half-year.
ILF’s chief executive Ian Muir said the fund has continued its strategy of selective acquisitions, while also forging new relationships in order to take advantage of the burgeoning Australian and
Accordingly, distributions for the period were increased by 11% from 4.82 cents per unit for the half year ended December 31, 2005 to 5.35 cents per unit for the current half year.
The net profit under AIFRS is $47.0 million, up from $4.0 million for the half year ended 31 December 2005, and includes fair value adjustments on investment properties and financial instruments. Distributable income (excluding AIFRS impact) for the period increased 6.3% to 5.1 cents per unit.
Muir said ILF is positioned to capitalise on the wave of baby Boomers moving up the age profile and their children now converging on college campuses.
“With the establishment of new alliances with joint venture partners in Australia, and the strengthening of existing partnerships in North America, the fund is well placed to take advantage of strong product pipelines, providing a solid platform for growth and delivering superior value for unitholders.” he concluded.
Meanwhile, Village Life has posted a net loss of $2.9 million for the half year, which is a 78% improvement on the December 2005 result.
Revenue fell 46% to $9.13 million. The company continues to make losses from its lease arrangement with the MFT Diversified Group, and, despite efforts to resolve this onerous lease position, there has been no satisfactory outcome to date.
The board has explored a range of potential re-capitalisation options during this period, as it is clear that the company cannot continue to operate nor develop new villages without an injection of new equity.
“The failure of the SunnyCove takeover was disappointing. Your directors considered that the merging of SunnyCove and Village Life had some compelling advantages and was recommended as being in the best interests of Village Life shareholders. As its minimum acceptance level and other conditions precedent were not met, the offer consequently lapsed,” the company said.
Meanwhile, Sunnycove and Village Life have entered into a Heads of Agreement for the acquisition by SCV of the VLL management rights in respect of 46 retail and wholesale communities for a purchase price of $13.5 million and 32 ING Community Living Fund communities for a purchase price of $500,000.
The purchase of the VLL management rights by SCV not only creates
ILF shares closed 0.01 cents lower at $1.31, Village Life also closed 0.01 cents lower at 10 cents and Sunnycove closed unchanged at 77 cents.
Australian Property Journal
