Brookfield’s preferred buyer has struck the deal, cementing its expansion into the seniors living sector under its new brand The Living Company.
Twelve months after rumours began swirling around Brookfield Asset Management’s divestment of the Aveo portfolio, the student beds developer has inked the $3.85-billion deal—the biggest direct real estate transaction in Australia’s history.
Brookfield acquired the Aveo portfolio in 2019, which now encompasses 10,000 units in metropolitan areas across the eastern seaboard of Australia.
The Urban Developer understands Scape had been in exclusive discussions with Brookfield about the portfolio acquisition for a number of months, alongside South Korea’s National Pension Service.
The transaction will also mark a shift in Scape’s structure with the different living sector assets all reportedly being managed under The Living Company umbrella.
Brookfield Real Estate chief executive Lowell Baron said the living sector had been a top performing segment in the business’ global real estate strategy for more than a decade.
“Aveo is a prime example of the operations-led turnaround investing that we excel at,” Baron said.
“Working with the Aveo team we leveraged our operating expertise to significantly transform the business, improving the resident experience and creating vibrant communities, all of which have led to record sales and occupancy levels.
“Given the favourable market dynamics that underpin the continued growth of the living sector, we will look to invest further capital in living across Asia Pacific.”
Brookfield acquired the listed Aveo Group In 2019 for $1.3 billion. It invested heavily in what it describes as a “turnaround strategy” to improve its customer-centric offering.
Brookfield co-head of real estate Australia Ruban Kaneshamoorthy said it was a “contrarian view” at the time when Brookfield bought up the seniors living portfolio.
“We identified a challenged platform that owned great real estate and this allowed us to execute an operations-driven turnaround,” Kaneshamoorthy said.
“During the past five years, in partnership with the Aveo management team, we invested heavily in the business and executed a business plan that moved Aveo from a platform with a lack of focus and direction to a high-performance, resident-first organisation that is well placed to take advantage of the strong demographic and structural tailwinds underpinning the growth of retirement living.”
Scape Australia continues its march deeper into the living sectors, with the deal for Aveo, which follows the $1.5-billion build-to-rent venture established in 2023 with Dutch investors APG, a pension fund, and Bouwinvest, a property fund manager.
Scape founders Craig Carracher and Stephen Gaitanos filed plans for a significant build-to-rent development in Sydney’s Marrickville earlier this year, under the group’s Rent-to-Live brand.
