Tourist park sold into new national affordable housing fund
MELBOURNE: A tourist park has been sold into a new $28m national housing fund designed to supercharge affordable rental housing across the country.
Affordable housing giant Eureka Group Holdings has launched its first “All Age Village Fund,” choosing the Barrier Reef Tourist Park in Edmonton as the lead asset to kickstart its regional strategy.
The deal, which settled on August 11, sees the southside tourist park sold into the new fund, backed by a $14.5m debt facility from the National Australia Bank and $14.35m in equity commitments.
Eureka has taken a 30.9 per cent stake in the fund, with the move freeing up $15m in cash for the ASX-listed company to buy more regional properties.
Eureka’s chief executive Simon Owen said the fund enables the company to accelerate its ’ “strategic growth pipeline”.
“The establishment of the Fund comes at a critical time as Australia navigates a severe, systemic housing crisis,” he said.
“With acute shortages in residential supply, escalating rental pressures, and structural affordability challenges impacting communities nationwide, it is important for Eureka to have multiple pools of capital to fund its growth and the investment in affordable rental housing.”
In December last year, Eureka lodged a proposal with Cairns Regional Council to transform a southside caravan park on Louie Piccone Way into 113 low-cost rental units.
As part of the five-stage plan, the park’s existing 72 caravan sites would make way for new accommodation, while a manager’s dwelling and a caravan site would be kept as part of the redevelopment and 18 of the 30 current cabins would also be retained.
An additional 95 new cabins would be built, consisting of 63 one-bedroom and 32 two-bedroom units with a mix of highset and low-set residences.
The company already operates the Eureka Cascade Gardens in Smithfield and Eureka Horizons Villas in Earlville.
Eureka also announced this week it acquired the Townsville Lakes Holiday Park for $6.75m.
The company, which also manages two seniors rental communities at Condon and Wulguru, plans to convert the 110-site park into permanent, long-term rental accommodation.
Mr Owen said the acquisition was supported by the city’s favourable demographic and housing market fundamentals.
“Townsville Lakes is a straight down the fairway acquisition for Eureka – attractive ingoing yield, compelling but low-risk conversion and expansion opportunities, strong demand for rental housing underpinned by a buoyant jobs-led economy, highly constrained housing supply and all park infrastructure (roads, sewer, electricity etc) already in place,” he said.
Settlement of the acquisition is expected to occur prior to the end of August.
The company also snapped up the Mandurah Coastal Holiday Park in Western Australia for $18.4m, which includes approval to build 66 more permanent homes on the 4.05ha site.