Ingenia puts funding boost to work

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Ingenia Communities has taken less than a month to put to use funds from last month's capital raising, with the acquisition of two new assets in NSW and Victoria worth a total $33 million.

The developer and owner of holiday parks and budget accommodation communities for seniors said on Wednesday it had exchanged on an established lifestyle community on the NSW coast as well as a 10-hectare greenfield site in a growth corridor 40 kilometres north of Melbourne.

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Holiday parks are likely to benefit in NSW and Queensland as restrictions on movement ease, boosting operators such as Ingenia. Nic Walker

The NSW acquisition, a mix of completed homes and approved, build-ready development sites, is likely to settle by the end of next month, while the Melbourne site, with capacity for a lifestyle community of 230 new homes, would settle in the second half of 2020, the company said.

“The equity raising provided additional capacity for Ingenia to deliver on its key strategic priorities of scale and sector leadership and we are moving rapidly to put the capital to work," chief executive Simon Owen said.

"We are continuing to progress current pipeline acquisitions and, as anticipated, are increasingly engaged on new opportunities. We remain on track to deploy the capital from the equity raising over the next 12 to 18 months."

Both were assets already identified when Ingenia embarked last month on the new equity issuance that raised $150 million out of a maximum target of $175 million. The company has $352 million of cash and undrawn
available debt (on a pro forma basis) following the raising.

Ingenia withdrew FY20 earnings guidance in March. On Wednesday it said home settlements were continuing and a loosening in restrictions on open inspections and auctions were creating a more positive environment for the home owners who had to sell to buy in Ingenia's communities.

"Year to date, a total of 266 new homes have settled, with a further 37 homes booked to settle before 30 June, 2020," the company said.

"Pricing and margins remain consistent with the prior period and the Group has 175 deposits and contracts in place, providing a solid pipeline for FY21."

Ingenia said the reopening of holiday parks in NSW from June 1 and Queensland from June 12 would be positive.

"We had anticipated increased demand for affordable domestic travel once restrictions eased and our team has been busy preparing our parks to reopen," Mr Owen said.

"We are seeing dramatic increases in website traffic, phone inquiries and online bookings in response to recent announcements."

The shares rose 4¢, or 1 per cent, to $4.12.