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Whangārei aged care facility with triple net lease for sale

New Zealanders are living longer and the country’s older population is growing proportionately faster than the overall population which has implications for the provision of healthcare, other community services and the supply of aged care facilities.

The age of entry into aged care accommodation in New Zealand is typically 85 years and above. This demographic is forecast to rise from 88,000 people in 2020 to 360,000 in 2063 – more than 309 percent growth.

There is ongoing need for different types of aged care facilities to provide older people with accommodation options to suit a broad range of requirements.

A well-presented and largely purpose-built 74-bed aged care facility offering resthome and hospital-level care in Whangārei, has been placed on the market for sale, with a long-term triple net lease in place to Heritage Lifecare Limited, one of New Zealand’s largest providers of residential aged care services.

Puriri Court Lifecare is located around 4km north of Whangārei and is one of more than 40 aged care facilities run by Heritage around the country, stretching from Whangārei to Invercargill. Heritage leverages its scale and wide resources to efficiently run its family-focused care homes, with centralised administrative functions and a strong operational focus on resident care.

The property for sale comprises three core titles being 202-204 Kamo Road which accommodates the care home and associated amenities, and 214 Kamo Road, a standalone residential property. There is also 2,795sqm of adjoining development land at 216 Kamo Road. In total, there is 9,592sqm of General Residential-zoned land and the titles will be sold as one lot.

Both the standalone residential property and the development parcel form part of the lease to Heritage Lifecare as occupier. Under this arrangement, and following due process, Heritage has the right to expand their current operation by developing the vacant site should they require it.

Heritage’s triple net lease is for 30 years from 31 March 2022, with rental of $703,905 per annum plus GST and outgoings. There are annual rent reviews to CPI, capped at 4 percent and three further rights of renewal of 20 years each.

The property is being marketed for sale by deadline private treaty closing 23rd April, unless sold prior, through Sunil Bhana, Mike Houlker and Henry Napier of Bayleys.

Bhana says the triple net lease provides a truly passive investment opportunity with sound underlying fundamentals and long-term cashflow.

“This is an opportunity for a private investor or trust to acquire an institutional grade asset and get a foothold in a sector that is generally reserved for bigger players, including listed entities.

“The triple net lease structure is distinctly superior to the majority of standard commercial leases, with the landlord insulated from all costs and maintenance of the property to the maximum extent permitted by law.

“Passive investors looking for robust returns will recognise that given New Zealand’s demographic trajectory and rising demand for living and care options for older people, aged care will continue to be a defensive asset class over time.”

The Puriri Court Lifecare facility has established gardens and was constructed in three stages between 1985 and 2000. It currently offers 74 rooms, some with ensuite bathrooms, and provides general resthome and hospital-level care.

Henry Napier, who heads up Bayleys’ Whangārei and mid-north commercial team, says there’s strong demand for commercial investment assets in the area and the district is proactively addressing future growth fundamentals.

“The Whangārei District Council’s draft proposed Long Term Plan 2024-34 is currently out for public consultation, with further improvements to infrastructure and community amenities planned.

“With an aging population, aged care facilities like Puriri Court serve a valuable role as they allow residents to remain in their community over their lifespan which is important for families and social connection.

“The additional developable land associated with the subject property we’re selling effectively future-proofs Heritage Lifecare’s facility, and will give the new landowner potential long-run advantages.”

In addition to Puriri Court Lifecare, the land and buildings associated with a Marlborough aged care facility, with the same fundamental tenure structure with Heritage Lifecare is also for sale through Bayleys.

Waterlea Lifecare is a 61-bed purpose-built care facility offering full resthome, respite, and dementia care located around 2km from the Blenheim CBD. It occupies a well-landscaped 5,121sqm site zoned Urban Residential, close to the Springlands shopping centre and roading arterials.

The property also has a long-term triple net lease to Heritage and from 31st March, 2024 will return net annual income of $419,012 plus GST, with renewals extending the potential lease term out to 2112, and built-in annual rental growth to CPI.

It is for sale via a deadline private treaty campaign closing 23rd April, unless sold prior, through Sunil Bhana, Mike Houlker, and Glenn Dick of Bayleys.

Click here for more information on the listing.

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