The management of manufactured home estate operator Gateway has commenced local and Asian road shows to support a planned float of their 25 manufactured home estates with 4,000 sites across Eastern Australia.

They have an additional seven MHEs with 2,164 sites they are in due diligence or option to purchase. They value the group at $300M.

Gateway is a syndicate made up of three MHE operators, Harvest, Port Nordica and Alceon. A number of the key directors were the drivers behind the growth of Babcock & Brown.

Gateway joins other village and MHE operators who identify their residents as a captured market to sell additional products and services to. Gateway specifically mentions insurance products, distribution of medicines, household goods and services as well as care services.

While MHEs appear to be a rapidly growing village segment the reality is that the Top 10 operators account for approximately 150 locations out of 3,000 across Australia - less than 5%. Still room for substantial growth.

What village operators need to appreciate is that, in addition to permanent resident rentals, most parks also generate tourism rentals. For Gateway, this means they receive cash on average every two weeks from 4,000 rental plots; a significant cash flow attraction compared to retirement villages.