Ingenia’s holiday park market is booming!
Formed in 2012 Ingenia Communities Group (ASX:INA) is a diversified real estate investment trust (REIT) with a portfolio of assets covering lifestyle, tourism and retirement living. In the latest small cap management video series, Gary Rollo catches up with Chief Executive Officer, Simon Owens to discuss key holiday park markets and the groups’ revenue streams.
Ingenia has a focus on two aspects of the Australian property market, firstly on seniors housing and lifestyle communities and secondly, on holiday parks. The company has a rental income base of $2 million per week spread over almost 7,000 sites.
In the seniors housing business, Ingenia owns the lifestyle village where the resident owns the house. They own 26 seniors’ rental villages, and residents who are predominantly on the pension, pay weekly rent. In Australia there’s about 130,000 people living in this style of community and looking at the US, around 19 million Americans or 6 per cent of the entire population of America live in this style of community so there is a significant runway for growth.
In 2019 caravanning and camping became Australia’s most popular holiday choice with over 60 million total visitor nights and over 14 million trips. Australians last year spent around $65 billion traveling overseas. With international travel off the agenda for a while, this sector of the domestic economy will be a beneficiary. In the holidays business, Ingenia owns and operates 21 holiday parks on the New South Wales and Queensland coast.
“COVID has been transformational for our holiday park business. Back in the early days, we had to shut down our holiday parks and we lost the entire Easter trade which is probably our busiest couple of weeks of the year outside of Christmas. Since early June, particularly in New South Wales and Queensland, the markets really exploded and the demand for affordable accessible holidays in Australia, particularly beach front holidays is growing almost exponentially and so now our forward bookings through Christmas and Easter next year are up 70 per cent on last year’s record numbers.” Simon Owen, Chief Executive Officer
You can also read more about Ingenia Communities Group and the tailwinds from increased domestic tourism and an ageing population in an article we published in November: GOOD TIMES AHEAD FOR INGENIA COMMUNITIES
You can view Part 2 which outlines Ingenia Communities Group’s growth strategy here: PART 2 AGEING POPULATIONS MEGA TREND
The Montgomery Small Companies Fund owns shares in Ingenia Communities Group. This video was prepared 01 December with the information we have today, and our view may change. It does not constitute formal advice or professional investment advice. If you wish to trade Ingenia Communities Group you should seek financial advice.
Gary Rollo is the Portfolio Manager of the Montgomery Small Companies Fund. Gary joined Montgomery in August 2019 after spending three years at MHOR Asset Management in Sydney as a Founder and Portfolio Manager. Prior to this, Gary was a Portfolio Manager at Renaissance Asset Manager in Sydney for six years. Before moving to Australia, Gary spent five years in London running Morgan Stanley’s Technology Sector Equity Research Team, as well as two years covering technology companies for JP Morgan.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
