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Monday 12 October
How is Springtree Lifestyle Resorts making downsizing more affordable?
With millions of new homes needed for Australians over 50, Springtree’s founders, Tom McDonald and David Laing, are scaling a different approach to housing. What sets it apart?
By Health View
Real estate firm Colliers predicts people aged 50 and over will account for 75 per cent of the new home market over the next 20 years, requiring approximately 2.27 million new homes.
This is the opportunity that Springtree’s founders, Tom McDonald and David Laing, are moving quickly to meet. The pair launched Springtree Lifestyle Resorts in 2024 – an over-55s housing business developing land lease communities designed to offer affordable, low-maintenance homes and a strong sense of community for Australians entering retirement.
Today, they have thriving Springtree communities in Victoria’s Yarrawonga and Cobram, while a third development in Warragul is already exceeding expectations with 60 per cent of the first stage sold.
“When we started out, the land lease model was still relatively new to the Australian market,” Tom says. “Now the benefits are better understood, we can’t build our homes fast enough.”
How does the land lease model work?
Under the land lease model, residents buy their home but lease the land it sits on. For Springtree, that means homes in Victoria can typically be offered for between $500,000 and $700,000.
“Our homes are more attainable for many people,” says Tom. “Residents don’t have to pay stamp duty on entry and there are no body corporate, strata, exit or deferred management fees. They also keep 100 per cent of any capital gains.”
As many downsizers sell their homes for more than $700,000, the difference can also help free up equity to support their retirement.
Springtree combines this financial model with resort-style amenities designed for active over-55s, including a pool, bowling green, gym and yoga studio. A clubhouse, games room, cinema, gardens and dog park are also designed to encourage social connection.
“Compared with traditional retirement villages, we believe Springtree’s land lease offering is a compelling model for both residents and investors,” Tom says.
What are the challenges of scaling?
Strong demand has helped Springtree expand rapidly. Its fourth community is now moving through the final stages of planning, and David and Tom have their sights set on other states.
“So far we have been focusing on Victoria, but we’re now expanding into New South Wales and Queensland,” says Tom.
But growth has created its own challenges.
“It can be quite difficult to find suitable land,” he points out. The main issue is planning permission – something they expect to improve with time. “Many councils aren’t yet familiar with this asset class, so we expect that to get easier soon,” he says.
Another challenge has been finding the right people to work with them. “We were growing so fast – we went from David and I to 16 employees in just over 18 months,” Tom says. “Fortunately, we now have a very skilled and experienced team.”
How did the US shape Springtree’s model?
Ultimately, Tom and David have left nothing to chance.
Before they launched Springtree, they were keen to see how the model operated at scale overseas.
They travelled through the United States’ Sun Belt to study the sector, which is considerably more established than in Australia.
“The scale and maturity of the sector really opened our eyes to the opportunity back home,” says Tom.
They also brought substantial experience of their own. Between them, Tom and David have spent more than 35 years working across the over-55s and broader living sector, with expertise spanning acquisitions, development, sales and operations.
That experience stood out to Stephen Oliver, Head of NAB Corporate Health, when the founders began speaking with NAB in December 2023.
“They understood the sector and had the experience to execute their strategy,” says Stephen. “They had complementary skills across the different parts of the business, which gave us confidence in what they were setting out to build.”
A banking partner for every stage of business
Those initial conversations were about exploring options rather than arranging finance.
“At first we were just discussing the opportunity and building a relationship,” says Tom. “Stephen understood our vision right from the start.”
In fact, NAB worked alongside the business for almost 12 months before its first site was secured, providing specialist sector expertise as well as finance.
That support continued as Springtree expanded. The NAB team introduced Tom and David to key consultants, including valuers and sales agents who are often involved in selling or advising on land opportunities.
NAB was also one of the first banks to gain experience in the land lease sector and has publicly supported the model as an affordable housing option for older Australians. It’s now a leading lender in the sector.
“It was a very deliberate strategy – with land lease communities part of our ambition to lend at least $60 billion by 2030 to help address Australia’s housing crisis,” says Stephen.
“We shared our insights, drawing on our long-term experience in the sector, and connected Springtree with the full breadth of NAB's broader sector knowledge, specialist expertise and industry relationships to help support their growth and decision-making.”
Looking to connect with a NAB Health banker?
Visit www.nab.com.au/health
