Aveo closes out rocky year with $248 million property sale
Written on the 22 December 2017 by Paris Faint
RETIREMENT village operator Aveo Group (ASX: AOG) has sold off its Gasworks Plaza complex in Newstead to AMP Capital for $248.4 million.
The sale comprises three separate developments, one of which is still under construction, however the assets include a mixed-use shopping centre and neighbourhood as well as a Woolworths supermarket and 31 specialty tenancies.
The contract is expected to settle in February for the Gasworks one and two developments, with the third to take place in September next year following completion of construction.
Aveo Group CEO Geoff Grady (pictured) said it was an ideal time to capitalise on Gasworks assets, which will attract "substantial capital for recycling" into other projects.
"As we came to the completion of the Aveo owned component of the Gasworks precinct, it was opportune to capitalise on the embedded value of the Gasworks retail and commercial component that we have held since its completion in August 2013," said Grady.
The sale marks an end to an otherwise controversial year for Aveo, which was the subject of a Four Corners investigation in June this year.
The joint investigation with Fairfax Media revealed stories of financial hardship experienced by some of the residents in Aveo retirement villages.
At the centre of the report, Four Corners spoke with residents and former residents and revealed the contracts they signed which include specific clauses relating to property sales and ongoing fees.
At the time, the contracts were described by lawyers and consumer advocates as "complex" and "rapacious".
Both Maddens Lawyers and Maurice Blackburn investigated class action suits against Aveo on behalf of elderly residents.
Business News Australia
Author: Paris Faint