In our April INSIGHT Is new buyback legislation the end of freehold retirement village units in Queensland?, we commented that the new legislation has made it unfeasible for many operators to continue.
As recently reported in the Financial Review, this dire prediction has been realised with the collapse of retirement village operator Settlers Lifestyle at the end of August. (https://www.commercialrealestate.com.au/news/queensland-buy-back-rules-behind-retirement-village-group-collapse-2-875072/)
This is an unfortunate situation for all concerned, especially the residents that this legislation was designed to better protect.
As we predicted, the collapse of some freehold retirement village operators was an inevitable outcome, particularly in light of the legislation being retrospective. But there are ways for operators to offer freehold models and avoid being negatively impacted.
Yet freehold is still an attractive option for many consumers and providers who carefully consider their model and draft more commercial terms to ensure they remain viable and sustainable.
Operators in this space should contact David Pyne at Property and Legal for solutions tailored to suit their identified market.
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