It’s been a very challenging couple of years for Lifestyle Communities, the owner/manager of over-fifties housing, with the shares more than halving from a 2021 high of $24. High interest rates have reduced volumes of sales, while they are also undergoing an independent review of their business model after the ABC attacked the fees they charge, specifically around deferred management fees, which can be worth up to 20% of what departing residents make from selling their homes.
The findings have yet to be released, so there is some risk around this. However, yesterday, we saw Activist investor David Di Pilla’s HMC Capital (HMC), which has a good track record of agitating for change, take a 2.69% stake with the capacity to buy another 4.5% through a total return swap arranged for a stake of 5,541,491 shares.
- This is an interesting move, using their HMC Capital Partners Fund 1 which is an $800m vehicle holding up to 10 stocks – current positions include Graincorp (GNC), Sigma (SIG), Baby Bunting (BBN) and Ingenia (INA).
