MHE operator Gateway looks to float for $300M – wants to expand services to residents

The management of manufactured home estate operator Gateway has commenced local and Asian road shows to support a planned float of their 25 manufactured home estates with 4000 sites across Eastern Australia. They have an additional seven MHEs with 2,164 sites they are in due diligence or option to purchase.

Gateway is a syndicate made up of three MHE operators, Harvest, Port Nordica and Alceon. A number of the key directors were the drivers behind the growth of Babcock & Brown.

Gateway joins other village and MHE operators who identify their residents as a captured market to sell additional products and services to. Gateway specifically mentions insurance products, distribution of medicines, household goods and services as well as care services.

While MHEs appear to be a rapidly growing village segment the reality is that the top 10 operators account for approximately 150 locations out of 3,000 across Australia - less than 5%. Still room for substantial growth.

What village operators need to appreciate is that, in addition to permanent resident rentals, most parks generate tourism rentals. For Gateway, this means they receive cash on average every two weeks from 4,000 rental plots; a significant attraction compared to retirement villages.