OCA - Oceania Group - retirement villages

[Baa_Baa]

You're also ignoring the 'weekly fees' and somehow writing that off as 'body corporate', but it's real money cashflow, every week.

[Daytr]

You're also ignoring the 'weekly fees' and somehow writing that off as 'body corporate', but it's real money cashflow, every week.

Nope, I'm not ignoring it, unless you are ignoring the costs that outweigh what the fees are supposed to cover.
And fees aren't paid up front.

[Daytr]

Ok in that case it's not a compounding investment (the rent income), and you would be better off with the dmf as you recieve the money at the start of the term (all the dmf money at the start would earn more in the bank from the start than being added incrementally).

Yes & no.
The rent would be compounding over time as would the full amount of DMF.
If the DMF or prepaid rent is 30% of the ORA then the operator is only being paid 70% for the value of the property upfront.
It can't be counted it twice, I.e a 30% profit on the sale. As the operators do call them sales after all.

So you either take 30% out of the profit of the sale and call it prepaid rent, or account for it as 100% sale, but not both.

[Cupsy]

superfluous to requirement

[Snow Leopard]

20240704_165814.jpg

This cup of Latte is more intelligent than the current conversation on the thread.

[Cupsy]

superfluous to requirement

[Baa_Baa]

This cup of Latte is more intelligent than the current conversation on the thread.

You said recently said, "watch this space", well we're still waiting, for your insightful although predictably acerbic contribution.

Let the dogs out Snowy.

[ValueNZ]

Ouch, what did I do to deserve that.

Snow Leopard is just bitter about holding OCA at $1.60...

[ValueNZ]

Rent money is paid right? Typically actually fortnightly not monthly so my example is conservative.
What is done with the money over the 7 years ? It's not put under the mattress.
I'm just using the banking it and earning interest as an example, again conservative.

Now apply that same logic to the ORA payment.

[ValueNZ]

Well as rent would be paid monthly for agreements sake instead of $300k on a million over 7 years it's worth circa $370k. Could be more if the rent was invested at higher than the 4.5% yeild. I.e if the rent was put in the bank.

It's still a good deal for the operator, but it's not free.

But the DMF is all upfront - aka a way better deal. Time value of money and all that