JUDE BARBACK talks to Guy Eady about life after Oceania and the rise of his new venture, the BeGroup.
I meet Guy Eady for coffee at the trendy BeGroup offices in Parnell, Auckland. As we sit on the sunny terrace overlooking Parnell, I reflect on how different this must feel from his former workplace, aged care provider Oceania Group, where he was chief executive for two and a half years.
Eady agrees. He’s gone from heading up 3,000 staff at Oceania to 10. And he seems pretty happy about the change.
But it is in talking about his vision for the BeGroup that Eady becomes particularly animated. The whole notion of Be is focused on creating environments where residents can Be happy, Be part of the community, and Be themselves. “It’s a straightforward industry,” he says. “It’s essentially about looking after people.”
The BeGroup, so the website tells me, was established by Eady and Pencarrow Private Equity Fund. Eady, an accountant, was introduced to Pencarrow towards the end of 2013 by Rod Gethen, a connection made during his days at Deloitte, and the BeGroup concept materialised fairly quickly from there. By April 2014 Eady had tendered his resignation to Oceania and by July he had left.
Pencarrow’s current fund (Fund IV) of $124 million is split over five investments, the BeGroup being one of them. Eady tells me Pencarrow’s investors include some of New Zealand’s largest institutional investors, including NZ Super, ACC and Trust Waikato, as well as some high-net individuals.
It’s exciting being at the start of a new venture.The Falls Estate in Whangarei was the first BeGroup acquisition. Eady says he instantly liked the vibe there, but also spotted some development potential for adding a care facility or around 30 more villas.
The second acquisition for the BeGroup, at a cool $8.1 million, was the former Rawhiti Bowling Club on Rangitoto Avenue in Remuera, Auckland, which will be redeveloped as the Rawhiti Retirement Village. There was a small amount of resistance from locals who sought to keep the land for recreation.
Eady dismisses this. After all, he was once a local, too. The site is just down the road from where he grew up.
“I knew the location well, and believed it had great potential for a retirement village,” he said.
The land was sold via a tender process, a process which Eady describes as “stressful” as it forced them to get organised very quickly.
Eady tells me that in addition to independent retirement villas, Rawhiti Village will include a full range of care options, including dementia care. It will include approximately 50 care beds and 20 independent living dwellings.
While an increasing number of village operators are incorporating care facilities into existing villages, some prefer to keep independent living separate. Eady says he can understand such reservations.
“Care isn’t majorly profitable,” he says, somewhat cautiously, “however, from a long-term view it is beneficial to a village to be able to offer a continuum of care.”
USP is crucial
The concept for Rawhiti Village couldn’t be more different from The Falls, but this doesn’t faze Eady, who says the important thing for a village is to “find its place in the community”.
“There’s always got to be a point of difference. For example, the USP [unique selling point] for Rawhiti is location. For each site it will be different.”
He’s also keen to identify what is working well in one facility and incorporate that in others.
“I’d like to replicate the culture of The Falls into other sites,” he says, by way of example.
Beyond Rawhiti, Eady says the BeGroup is currently looking at two other greenfield sites and doing due diligence on those.
“We may even look in Melbourne,” he says, in obvious reference to Ryman’s move across the ditch, but I can’t tell if he is being serious.
But he is earnest on the subject of growing the business.
“We are looking to grow to a point where we don’t need to bring in new capital and we can reinvest back into the existing and future sites,” says Eady.
Eady thinks it is a good time to be in the retirement and aged care industries.
“Thirty years ago banks didn’t understand the model. Investors didn’t understand the model. Now they do.”
Eady thinks being smaller gives the BeGroup certain advantages over competing organisations.
“We can move faster – the tender process was a test of that – and we can be innovative and offer more unique bespoke products and services.”
Innovation is set to become a key hallmark of the BeGroup. Eady feels there is a lack of innovation in the sector at present, partly due to an ‘if it ain’t broke, don’t fix it’ mentality. The sector appears to be content with playing it safe. He says that the bigger players are not being pressured into changing or experimenting with new ideas.
“Their investment is being refunnelled into what they’ve been doing before,” he says.
It is interesting hearing Eady discuss the big corporates, as I am used to associating him with Oceania, one of the largest aged care providers in the country.
He says his time at Oceania gave him a wealth of experience in building, developing and selling, and helped him to build important relationships with lawyers, bankers and other people with expertise in areas relevant to his new venture.
Eady has been entrenched in the aged care industry for a long time. His own rest home business was bought by LifeCare Residences and he subsequently joined the Macquarie Group, which formed the Oceania Group. He has served on the board of the
New Zealand Aged Care Association for 10 years, during which time he has “enjoyed getting an insight into the way Wellington ticks”.
I sense Eady is pleased to be on a different track now, with the BeGroup. He talks about the sense of relief that comes with having a clean slate from which to start.
Indeed, the swish white Parnell offices, the modern business cards with their contemporary fonts and colours, the transparent enthusiasm that Eady shows when talking about his new venture, all give the impression that this is a good place to Be.