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THRL Target Healthcare Reit Plc

84.20
2.70 (3.31%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Target Healthcare Reit Plc LSE:THRL London Ordinary Share GB00BJGTLF51 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  2.70 3.31% 84.20 83.40 84.00 84.50 80.50 82.10 2,663,585 16:35:19
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Finance Services 67.75M -6.57M -0.0106 -79.25 521M

Target Healthcare REIT Limited Acquisitions in Hertfordshire, York and the Wirral (4736Y)

06/12/2017 7:00am

UK Regulatory


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RNS Number : 4736Y

Target Healthcare REIT Limited

06 December 2017

Target Healthcare REIT Limited

RNS Announcement

6 December 2017

Care home acquisitions in Hertfordshire, York and the Wirral

Target Healthcare REIT Limited and its subsidiaries ("the Group"), the UK listed specialist investor in care homes, announces that it has completed the acquisition of three properties in Hertfordshire, York and the Wirral for a total value of GBP31 million (including purchaser's costs).

The Hertfordshire care home opened in 2013 and comprises 64 well-appointed bedrooms each of which benefits from full en-suite wetroom facilities. The luxurious surroundings of the home, combined with the attention to detail provided by the care staff, mean the home represents one of the highest quality care home environments in the UK.

The Hertfordshire home will continue to be run by the incumbent operator, a new tenant to the Group, under a 30-year full repairing and insuring lease. The purchase price is approximately GBP20 million (including purchaser's costs) and the rent payable is subject to annual, upwards-only, RPI-linked uplifts, incorporating a cap and collar. The investment yield for this property is lower than the portfolio average reflecting the exceptional quality of the home, prime location and the strong trading performance.

The care home in York was opened in 2006 and comprises 81 bedrooms with market standard en-suite bathrooms, including wetroom showers. The property also benefits from a number of separate lounges and dining rooms; a cinema room; a library; a hairdressing salon; and well-maintained landscaped gardens.

The home on the Wirral is a purpose-built property which opened in 1999 and comprises 86 bedrooms, all of which include en-suite facilities. The home is well-appointed and includes several lounge / dining areas overlooking the large, landscaped gardens; a hairdressing salon; and quiet lounges.

The tenant for the York and Wirral properties is a subsidiary of the Four Seasons Health Care Group ("Four Seasons"), one of the UK's largest care home operators. As part of the transaction, the Group will be stepping into the existing full repairing and insuring occupational leases which together have a blended average unexpired lease term of approximately 21 years.

The York and Wirral homes have both traded profitably for several years, evidencing average rent cover of 2.2x predicated on sustainable rents, and are supported by compelling local demographics. The net initial investment yield on acquisition of 7.8% is higher than the portfolio average reflecting, inter alia, the weaker corporate covenant, whilst the price paid is significantly below replacement cost and approximately 35% below the Group's average capital cost per bed.

John Flannelly, Head of Investment at Target Fund Managers, commented on the acquisitions:

"We are extremely pleased to announce the completion of these transactions. The Hertfordshire home is of the highest quality and represents a very positive addition to the Group. The operator has demonstrated an enviable track record of delivering a strong trading performance over a sustained period and we are delighted to welcome them into the Group.

The acquisition of the York and Wirral properties is entirely consistent with our approach of investing in good buildings with favourable local market characteristics let at sustainable rental levels. There has been considerable media interest in Four Seasons in recent weeks and months, and we note that restructuring proposals are under consideration and the principal creditor is seeking to put in place an appropriate capital structure for Four Seasons over the long-term.

In any event, the homes are attractive operational assets and the acquisition price offers an opportunity for long-term capital growth.

We continue to progress other opportunities and expect to make more announcements in the near future."

All enquiries:

 
 Kenneth MacKenzie / John 
  Flannelly 
  Target Fund Managers           01786 845 912 
 Martin Cassels 
  Maitland Administration 
  Services (Scotland) Limited    0131 550 3760 
 Fiona Harris / Sam Emery        020 7466 5058 / 020 7466 
  Quill PR                        5056 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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(END) Dow Jones Newswires

December 06, 2017 02:00 ET (07:00 GMT)

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