Eureka Group Holdings Ltd (ASX:EGH) is continuing its ‘buy and build’ strategy by agreeing to acquire the 55-unit Albert Street Gardens retirement village in Orange, New South Wales for $5.115 million.
Eureka is focused on providing rental accommodation and associated care to independent retirees dependent on Australian Government pension and rent assistance.
Albert Street Gardens is an ideal fit for Eureka with long term historic occupancy of 92% and is expected to generate annual EBITDA of about $720,000.
Importantly, the village occupancy and financial performance meet Eureka’s required EBITDA return rate.
The potential opportunities are also underpinned by the demographic profile of Orange, which has about 40,000 people, 20% of which are aged over 65.
With the latest acquisition, Eureka now owns 24 villages (1,254 units) with a total of 33 villages (1,993 units) under management.
The company is cashed up after raising $12.5 million in June from institutional Investors by issuing shares at $0.75 each.
Eureka has made a string of retirement village acquisitions recently as part of its buy and build strategy, across Runaway Bay, Margate, Townsville and the Gold Coast in Queensland, as well as Morphettville in South Australia.
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