Residential property developer Villa World has reacted positively to the Victorian Government’s stimulus package for new home buyers by announcing a $33 million land acquisition in Melbourne’s south east growth corridor.
First home buyers and owner-occupiers in the affordable to mid-price range are Villa World’s core customers and are key beneficiaries of Victoria’s latest round of housing incentives.
The Company’s unconditional purchase of a 42-hectare site at Clyde, 55km south east of the Melbourne CBD, comes with an existing residential zoning for more than 400 home sites.
The growth corridor has already drawn strong demand for Villa World with sales at its Cardinia Views estate, at Pakenham, outstripping forecast and due to sell out well ahead of schedule.
The Company has welcomed the State Government’s incentive package for first home buyers, adding to its existing interest in expanding its footprint in Victoria to match the Company’s Queensland portfolio.
Villa World Managing Director and Chief Executive Mr Craig Treasure said he considered the Melbourne market to be extremely strong right now, buoyed by population growth.
“We have been looking to grow our five to six-year pipeline of projects in Victoria, specifically in the south east corridor because of the proximity to transport, excellent education facilities and attractive retail precincts,” Mr Treasure said.
“The Clyde purchase is in line with our strategy of growing through disciplined and targeted acquisitions.”
Robust sales and increased revenue contributed to Villa World last month declaring a strong half year profit result and prompting an upgrade in its full year guidance to a profit after tax of $37.5 million, representing 11% expected growth on its FY16 result.
Victoria contributed the Company’s revenue gains with sales there increasing 26% in the half-year to 31 December 2016, compared with 20% for the same period the previous year.
Villa World shares will trade ex-dividend of 8 cps on 8 March. Directors anticipate a final year dividend of 10.5 cps, bringing total dividends of 18.5 cps for the full year – a strong 7.4% yield.
Mr Treasure said replenishing land stock in one of Victoria’s best performing growth corridors was part of the Company’s plan to re-balance its portfolio towards 40% in Victoria, 20% in New South Wales and 40% in Queensland.
The 400-plus residential estate at Clyde will include a substantial portion of green space devoted for creek and conservation reserves. Settlement will occur in 1H18.
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