Serenitas’ lifestyle business appeals to high-profile bidders

Serenitas chief executive Rob Nichols turns a sod on the new Thyme Lifestyle Resort at Evans Head in NSW.

High-profile groups like Stockland, Hometown, Brookfield and Ingenia have lined up to buy the $1bn-plus Australian lifestyle communities business Serenitas.

First-round bids for the business were understood to have been received a few weeks ago and the big question is whether the offers made by the interested buyers are enough to win over the company’s owners.

Singapore’s sovereign wealth fund GIC has put its half share on the market and is believed to be commanding a price of at least $800m.

But if the price is right, it is understood that the other owners are open to a sale of the business as a whole.

Yet, sources say that there is a wide gap between the initial offers for the business, which is up for sale through investment bank Goldman Sachs, and the owner’s expectations.

It’s a tough market to be conducting a sale process and any potential buyer will be factoring in the rising cost of debt with roaring inflation in global markets.

The country’s largest superannuation fund, AustralianSuper, was understood to be looking but has since retreated.

Serenitas was formed when GIC and Tasman Capital Partners purchased Western Australia-based National Lifestyle Villages in 2018 from Navis Capital and Blackstone. The business is jointly owned by the parties.

The founder and chief executive of Serenitas is Rob Nichols, who was the former chief operating officer of the listed modulated housing provider Gateway Lifestyle.

Gateway was purchased in 2018 by US-based Hometown America for $685m or $942m including debt.

At the time, Brookfield was an under bidder.

Serenitas owns various land lease communities, including Thyme Lifestyle Resorts, National Lifestyle Villages, which is the market leader in WA, The Vantage at Vasse, The Outlook at Albany, RV Homebase Fraser Coast and a pipeline of communities under development for over-50s land lease living.

Some believe that the sale of the business is odd timing, given that the booming real estate market conditions during the global pandemic have changed with rising interest rates.

But GIC’s move to exit Serenitas comes after it recently pulled out of a deal to buy Brookfield and Blackstone’s $2.1bn tower complex in Melbourne.

Manufactured housing estates work where an operator owns the land and rents the site to residents, who buy the relocatable home for the site.

Owned by groups like Ingenia and Serenitas, they are growing in popularity as they are seen as a way to address housing affordability challenges and are more prominent in the United States.

The listed Stockland, led by Tarun Gupta, is one fan of the sector.

The country’s largest listed developer is interested in Serenitas after it purchased land lease community owner and developer Halcyon Group for $620m last year.