Here is a link that explains the costs of a recent actual example of a "
conversion" from 5 care beds into 4 Care suites.
http://nzx-prod-s7fsd7f98s.s3-websit...631/290269.pdf
Its in an Oceania investor presentation recently put out , check out page 30, it's all laid out quite nicely.
I think what you have confused here is the
new villa builds with
conversions of care bads to care suites.
New villa builds do rent out (ORA) at a premium to their build cost, the clients pay in full upfront so that margin on payment is revenue. However the "conversions" costs the company upfront which they eventually get back through an improved ORA, but this is less than the cost of the initial conversion.
The link above is well laid out and will explain how the whole thing works. Be warned, it might take a lot of effort and thinking (it did for me anyway) to get your head around the terms used , accounting etc but its all there.