Eureka expands North Queensland footprint with $6.75m Townsville acquisition
Eureka Group Holdings (ASX: EGH) has entered binding agreements to acquire the Townsville Lakes Holiday Park, an immediately earnings accretive all-age rental community in Tropical North Queensland.
The $6.75 million deal reflects an initial yield of 9.1% (including transaction costs) and adds 110 sites to the portfolio, lifting Eureka’s all-age rental holdings (rent-collecting homes and sites) by 8%. Management has framed the transaction as adding income from day one.
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Inside the Townsville Lakes acquisition
The park comprises 110 sites, providing an established platform of tourist and rental accommodation. The current split is:
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26 short-stay tourist cabins
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82 powered ensuite sites
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2 park owned rentals
On-site amenities include a swimming pool, camp kitchen and BBQ areas. Critically, all park infrastructure, including roads, sewer and electricity, is already in place, which reduces execution risk on the conversion strategy ahead.
Eureka already manages two seniors rental communities in Townsville, Condon and Wulguru, which consistently operate at 100% occupancy with strong waitlists. This demonstrates proven local demand for the Group’s rental model.
The Townsville deal follows a pattern Eureka has applied consistently across its regional portfolio: the Nagambie Lifestyle Park acquisition in Victoria was similarly structured around an ingoing yield with embedded expansion upside, where 26 serviced vacant sites offered a value-add runway beyond the day-one income.
| Metric | Detail | Investor Impact |
|---|---|---|
| Purchase price | $6.75 million | Modest, accretive addition |
| Initial yield | 9.1% (incl. transaction costs) | Income from day one |
| Target 5-year IRR | 18.2% (unlevered) | Conversion-led upside |
| Portfolio uplift | 8% (rent-collecting homes/sites) | Expanded recurring income base |
| Settlement | Before the end of August | Near-term completion |
Why the Townsville housing market underpins the deal
Townsville is the largest city in North Queensland and supports a diversified local economy across defence, mining, healthcare, logistics and agriculture. The demographic and housing backdrop underpins the demand case for long-term rental accommodation.
Key market indicators include:
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Population in excess of 200,000, with a broad-based, jobs-led economy
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Median house price of $650,000, up 30% over the last 12 months
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Rental vacancy rate of 0.6% (a rate of 3.0% is considered balanced)
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Median rent of $462, up 16% over the last 12 months
A severe supply constraint combined with an employment-led economy supports strong demand for long-term rental housing in the region.
Understanding the land lease and all-age rental model
The value driver in this transaction is the conversion of short-term accommodation to long-term rental housing and/or land lease homes. Execution of this strategy is forecast to deliver an unlevered IRR of greater than 18.2%.
The conversion upside and forward pipeline
Eureka’s 3-5 year strategy for Townsville Lakes centres on site reconfiguration and full conversion to long-term rental housing and/or land lease homes. Execution of this strategy is forecast to deliver an unlevered IRR of greater than 18.2%.
The transaction sits within a much broader growth roadmap. The Group is progressing approximately $120 million of further acquisition opportunities currently under due diligence or advanced price discovery.
Near-term timeline points include:
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Settlement expected prior to the end of August 2026
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A 3-5 year conversion strategy to follow
Simon Owen, Managing Director & CEO
“Townsville Lakes is a straight down the fairway acquisition for Eureka – attractive ingoing yield, compelling but low-risk conversion and expansion opportunities, strong demand for rental housing underpinned by a buoyant jobs-led economy, highly constrained housing supply and all park infrastructure (roads, sewer, electricity etc) already in place.”
What it means for Eureka investors
The acquisition delivers day-one income while the forecast conversion upside offers a pathway to enhanced returns over the medium term. With roughly $120 million of further opportunities under assessment, the deal signals continued, disciplined expansion into supply-constrained regional markets.
The capital fuelling that pipeline extends beyond Eureka’s ASX balance sheet: the Eureka All Age Village Fund closed in August 2026 and recycled $15 million back to the company while Eureka retained a 30.9% equity stake, origination fees, and a 20% performance carry, creating a parallel capital pool for continued acquisitions.
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