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A new retirement company set to float on the NZX owns just two Auckland villages and even those close to the deal are describing it as a "boutique offering".
ING Real Living announced this month that it would raise $100 million from the public and issue a prospectus, around the same time AMP Capital Investors is seeking $300 million by floating 80 per cent of Summerset, its retirement business.
Some analysts and fund managers said the ING deal was far too small to grab their interest and they questioned a related-party transaction proposed between the company and its new chief.
Nick Wevers, the newly appointed general manager of ING Real Living, is developing an Epsom property with a business partner and the new company plans to buy their project.
Wevers said ING would float with two properties: Remuera Gardens, a village with 113 units and a 32-bed rest home on Richard Farrell Ave, and Epsom Village, with 67 units on Ranfurly Rd.
Wevers has been planning to develop another village on Minto Rd, not far from Epsom Village.
Wevers said he had a resource consent application to build a 97-unit village on a 1.5ha site there. ING has the right to buy that project, he said.
But those involved in the deal said ING was unlikely to stop at two or three villages and would use the float to expand further into the golden-oldie business and develop more properties.
Fund managers ING and developers Symphony Group are partners in the new deal, possibly signifying the intention to grab more land and build.
The sector is seen as having growth prospects because of New Zealand's ageing population. At present, 12 per cent of New Zealanders are aged over 65. By 2039 that figure is expected to more than double to 25 per cent.
Wevers has had close involvement in the property business for many years and is a former national president of the Property Council. He has just stepped down as independent director of the listed Kermadec Property Fund. He is a former chief executive of Capital Properties and for a short time headed apartment specialist Blue Chip, which left the NZX and listed on the ASX as Blue Chip Financial Solutions in May last year.
He was also general manager of Government Property Services for seven years.
ING Real Living will be chaired by Peter Fitzsimmons, former chairman of Metlifecare.
Ricky Ward, domestic equities manager at Tyndall Investment Management, said the two new floats would provide alternatives for investors who could now get exposure to the sector only from Ryman Healthcare and Metlifecare.
"No doubt these IPOs will place further pressure on already listed companies in this sector - Metlifecare and Ryman - as now there are alternatives," Ward said.
Ryman has been the only options for most investors, because only about 5 per cent of Metlifecare is traded, with more than 90 per cent held by large fund managers.
ING and Symphony already own the management of two other NZX-listed vehicles.
ASSETS
ING Real Living will have:
* A 113-unit Remuera village.
* A 67-unit Epsom village.
* Right to buy a third proposed village.
