Ryman Healthcare reported steady retirement living sales in Q1 FY27 with a 7% rise in net resales, buoyed by serviced apartments. The company remains on track for FY27 build targets and sees robust aged care occupancy despite housing market headwinds.
- 325 retirement living ORA sales in Q1 FY27, including 265 resales
- 7% increase in net resales driven by serviced apartments
- New sales stock reduced by 65 units to 414
- On track for FY27 build guidance of 157–168 units and aged care beds
- Aged care occupancy steady at 96.1% with growing premium resident base
Stable Resale Volumes Bolstered by Serviced Apartments
Ryman Healthcare (NZX:RYM) kicked off FY27 with 325 sales of retirement living occupation right agreements (ORAs) in the June quarter, comprising 265 resales and 60 new sales. Resale volumes held steady year-on-year, with a 7% increase in net resales reflecting strong demand for serviced apartments, which now form a larger share of the mix. CEO Naomi James highlighted that resales have remained resilient despite global housing market pressures, attributing the strength to targeted sales strategies and rising interest in assisted living options.
New Sales Inventory Shrinks as Key Villages Perform
New sales stock declined by 65 units to 414, including 60 new sales and a reclassification of five retirement living units to aged care. Serviced apartments at Bert Newton Village in Melbourne and Kevin Hickman Village in Christchurch showed robust sales momentum. This reduction in stock aligns with Ryman’s broader strategy to unlock NZ$500 million in cash by FY29, with further progress expected throughout FY27.
Build Program on Track with Strong Pre-Sales
The company confirmed it remains on course to meet its FY27 construction targets, aiming to deliver 157 to 168 retirement living units and aged care beds across Patrick Hogan Village in Cambridge and Richard Hadlee Village in Christchurch. This includes 60 aged care beds, 71 serviced apartments, and 26 to 37 independent living units, all slated for delivery in the second half of the year. Notably, 15 townhouses at Patrick Hogan Village were released for pre-sale during the quarter, with approximately two-thirds contracted within the first week.
Aged Care Demand Remains Robust with High Occupancy
Ryman’s aged care facilities, which encompass around 4,700 beds, maintained a steady occupancy rate of 96.1% in Q1 FY27, unchanged from the previous quarter. The premium-paying resident base continues to expand, with combined penetration of room premiums and capital products rising to 87.1% in New Zealand aged care centres. Meanwhile, in Australia, the average incoming refundable accommodation deposit (RAD) exceeded A$750,000, underscoring the strength of demand and pricing in that market.
Housing Market Challenges Temper Independent Living Sales
While demand for aged care and assisted living remains strong, independent living sales have been affected by subdued housing market conditions. James noted that the company is adapting by offering greater product choice and pricing flexibility across its retirement living spectrum. The objective is to elevate retirement living resale volumes to match turnover levels by the end of FY27, balancing market headwinds with targeted sales efforts.
Bottom Line?
Ryman’s steady sales and build progress reflect resilience in aged care demand, but housing market softness may keep independent living sales subdued.
Questions in the middle?
- Will Ryman’s strategy to boost retirement living resales offset ongoing housing market softness?
- How will the mix shift between independent living, assisted living, and aged care evolve over FY27?
- What impact will the $500 million cash release target have on capital allocation and development pace?