Eureka Group Holdings expands its footprint on Victoria's East Coast by acquiring Frenchview Lifestyle Village and Paynesville Holiday Park, adding nearly 200 sites and increasing its all-age rental portfolio by 17%.
- Acquisition of 199 sites across two Victorian coastal communities
- Frenchview purchased for $7.5 million with 7.9% initial yield
- Paynesville acquired for $6.6 million with 7.6% initial yield
- Portfolio grows by approximately 17% in rent-collecting sites
- Additional $90 million in acquisitions under due diligence
Significant Victorian Coastal Expansion
Eureka Group Holdings (ASX:EGH) has sharply increased its presence on Victoria’s East Coast with the off-market acquisition of Frenchview Lifestyle Village and Paynesville Holiday Park. Together, these two communities add 199 sites to Eureka’s all-age rental portfolio, marking a roughly 17% boost in rent-collecting homes and sites.
Frenchview Lifestyle Village, situated in Grantville within the rapidly growing Bass Coast Shire, was acquired for $7.5 million. The community offers 103 sites, including 78 permanent manufactured home estates (MHE) generating rental income, alongside development-ready sites and park-owned rentals. The purchase price reflects an initial yield of 7.9% and targets a five-year internal rate of return (IRR) of 15.2%, with $1 million deferred for twelve months.
Mixed-Use Growth at Paynesville Holiday Park
Paynesville Holiday Park, located about 300 kilometres east of Melbourne in East Gippsland, was acquired for $6.6 million. The park comprises 96 sites that blend permanent homes, park-owned rentals, tourist cabins, and powered short-stay sites. Its initial yield stands at 7.6%, with a more ambitious target five-year IRR of 17.3%, and $1.1 million of the purchase price deferred for six months. The site boasts amenities such as a swimming pool, camp kitchen, and games room, enhancing its appeal for residents and visitors alike.
Both communities come with development-ready sites approved for prefab homes, offering Eureka further upside through densification and potential expansion, particularly at Paynesville where adjoining land acquisition is possible. These acquisitions align with Eureka’s strategy of capitalising on regional demographic growth and affordable housing demand, especially in areas benefiting from population inflows from Melbourne.
Portfolio Growth and Strategic Momentum
Managing Director Simon Owen highlighted that these deals underscore Eureka’s ability to source off-market opportunities through strong industry networks. With Frenchview and Paynesville, Eureka will have completed eleven all-age rental acquisitions in just over a year, steadily building scale in Victorian regional markets.
The group is actively pursuing approximately $90 million more in acquisitions under due diligence or advanced price discovery, indicating continued momentum in portfolio expansion. This follows earlier Victorian purchases such as the $11 million Nagambie Lifestyle Park acquisition, which similarly targeted regional growth and development potential, reinforcing Eureka’s strategic focus on affordable rental communities in growth corridors.
Settlement for the new acquisitions is expected within three weeks, setting the stage for rental income contributions and future development activity that could further enhance returns.
Bottom Line?
Eureka’s latest coastal acquisitions deepen its Victorian footprint and development pipeline, but the deferred payments and ongoing acquisition pipeline warrant close attention.
Questions in the middle?
- How will the deferred purchase price impact Eureka’s near-term cash flow and financing needs?
- What timelines and capital expenditure will be required to unlock the development-ready sites?
- How might ongoing acquisitions affect Eureka’s portfolio risk profile and operational focus?