Kiama Council and Hall & Prior sign Blue Haven Bonaira contract

Published on 17 July 2024

Kiama Municipal Council and Hall & Prior Aged Care today executed the contract for the sale of Blue Haven Bonaira with settlement to occur on 1 November this year.  

This strategic agreement was endorsed at last night’s Ordinary Council Meeting and marks a significant step in improving the Council's financial position and ensuring the sustainability of its services for the community, while also ensuring a positive outcome for staff and residents.  

The decision to sell Blue Haven Bonaira follows a comprehensive tender process, which then led to Council entering direct negotiations with Hall & Prior Aged Care, a leading provider of aged care services across NSW and Western Australia. 

The agreed sale price is $95 million. This will be adjusted for certain liabilities that Hall & Prior will assume at settlement. This includes employee entitlements, refundable accommodation deposits and Independent Living Unit (ILU) entry contributions. After adjustments, sale proceeds are estimated to be $26 million.  

The sale terms include a $1.2 million deposit, with the remaining amount to be settled via two payments: the first due at settlement, which is planned for 1 November of this year, and the remainder due two years after settlement. Importantly, this outcome ensures that Kiama Council can repay the final $15 million of its TCorp loan. 

Kiama Mayor Neil Reilly emphasised the sale to Hall & Prior Aged Care would continue to ensure the provision of high-quality care for residents while securing the Council's financial stability. 

"This sale is a positive outcome for our community and our Council," Mayor Reilly said. "It ensures that Blue Haven Bonaira continues to provide excellent care under the management of Hall & Prior Aged Care, while also allowing us to focus on our financial sustainability and service delivery. We have been working towards this for several years and have kept the community and relevant NSW Government Ministers informed every step of the way.” 

Hall & Prior CEO Graeme Prior said that as a long-term operator of residential, retirement and home care in WA and NSW, the group was looking forward to bringing their high-quality care programs to the Kiama community. 

“We were attracted to the region as it aligned with our existing care programs in NSW and are looking forward to working with the Blue Haven team and community at large to ensure a smooth transition,” Mr Prior said. 

Kiama Council CEO Jane Stroud said staff were a critical consideration of the proposed sale, as they are the key to continuity of service. 

Kiama Council has approval to lodge an application in the Industrial Relations Commission (IRC) to seek the transfer of staff to Hall & Prior Aged Care on terms that ensure they are no worse off and can transfer across seamlessly. This application is being prepared and will be lodged shortly. The Council will work closely with Hall & Prior Aged Care to protect staff entitlements and conditions. 

Ms Stroud confirmed the fact that the sale price had been negatively affected by several key factors including building defects, including bathroom design concerns, drainage and cladding.  

“These are not new concerns and Kiama Council has been upfront about these matters and the history of the myriad issues associated with the Blue Haven Bonaira build and the ongoing operational losses for three years,” Ms Stroud said. 

“Council staff have worked diligently to document and address defects as they arose and to inform the public and residents of Blue Haven Bonaira.”

“I am looking forward to supporting the staff of Blue Haven to transition safely and seamlessly to their new employer, who is an expert in the field of aged care, and to supporting the organisation post the divestment to refocus on core Council business and meet the NSW Government-imposed Performance Improvement Order.” 

“Kiama Council has had a rich tradition in aged care but there is a bold future of the organisation in a new direction, and I am relieved to see the service taken on by specialists in the industry,” Ms Stroud said. 

Councillors also resolved to pursue legal action concerning the building defects. While this will incur costs, Ms Stroud said the material impact of the defects on the asset's value cannot be ignored.  

Hall & Prior Aged Care is aware of the defects, having received all relevant information as part of the tender process, and is committed to addressing these issues and ensuring the continued delivery of high-quality care. 

For further information, please contact Claire Doble, Manager Communications & Engagement, Kiama Council 0477 274 858 claire.doble@kiama.nsw.gov.au  

About Kiama Municipal Council: Kiama Municipal Council is dedicated to providing high-quality services and initiatives that enhance the well-being and sustainability of the Kiama community. Through strategic planning and community engagement, the Council strives to meet the needs of its residents and ensure a prosperous future for all. 

About Hall & Prior Aged Care: Hall & Prior Aged Care is a respected provider of aged care services, committed to delivering compassionate and high-quality care to residents. With a focus on innovation and excellence, Hall & Prior Aged Care operates 36 facilities across Australia, ensuring the well-being and dignity of all residents.  

Photo: Kiama Mayor Neil Reilly (left) with Hall & Prior CEO Graeme Prior