Centuria forms healthcare JV with Morgan Stanley Real Estate
- Three seed assets worth $210 million, 12 year WALE1, 99% occupancy
- Morgan Stanley Real Estate Investing joint venture illustrates Centuria’s broad range of capital sources
- Assets focus on cost-effective real estate solutions that deliver better patient care
- Additional pipeline assets identified, intention to grow the JV fund.
Centuria Capital Group (ASX: CNI or “Centuria”), today announced it has established a new institutional healthcare partnership through a joint venture (JV) with an investment vehicle sponsored by Morgan Stanley Real Estate Investing (MSREI), to be called the Centuria Prime Partnership (CPP).
CPP is seeded with three healthcare real estate assets collectively worth $210 million2. The assets are supported by strong tenant covenants and high quality operators on long lease terms, providing a portfolio Weighted Average Lease Expiry (WALE) of 12 years1 and 99% occupancy.
Centuria has identified further assets for CPP and it is intended additional healthcare acquisitions will be made.
Centuria will act as CPP’s Trust Administrator, Property Manager and Development Manager.
Jason Huljich, Centuria Joint CEO said, “We are very pleased to announce our partnership with MSREI, which provides another opportunity to utilise our strong in-house healthcare real estate capabilities and further broadens our access to additional capital sources.”
CPP’s seed assets include the $75 million2 Adeney Private Hospital, Kew VIC, which will provide four theatres, an infusion chemotherapy clinic and 30 beds. The asset recently received development approval and construction is expected to commence in June 20223. It will be operated by a joint venture between doctors and private health insurer, Medibank.
The $97 million Westside Private Hospital, Brisbane QLD provides four theatres, an infusion chemotherapy clinic, seven overnight beds and a 63 room medihotel. It is operated by Montserrat Day Hospitals, part of ASX-listed Healius Limited.
The $38 million Mater Private Hospital, Townsville QLD, provides four theatres, 34 beds, and includes the Icon Cancer Centre and Queensland X-ray.
Andrew Hemming, Centuria Healthcare Managing Director, added, “Since 2019, Centuria has significantly grown its healthcare AUM to approximately $1.7 billion4 by focusing on healthcare real estate models of care that are cost effective and deliver better patient care for our high quality operational partners. We will continue to focus on the acquisition of institutional-grade properties as well as developing out our $900 million healthcare pipeline.”
CPP comprises a 90% investment from MSREI and 10% from Centuria.
CPP complements Centuria Healthcare’s broad range of existing funds including five closed, unlisted funds; a wholesale fund; three development funds; and the open-ended unlisted retail fund, Centuria Healthcare Property Fund (CHPF).
CHPF was established in September 2020 and currently includes 21 healthcare properties5 worth $550 million with a 10.8 year WALE and 99% occupancy.
Centuria Healthcare invests in healthcare real estate across a wide range of asset classes including short-stay and day hospitals, mental health facilities, medical centres, specialist centres, life science facilities and aged care centres.
Centuria Healthcare was established in 2019 following Centuria Capital’s 63% investment in Heathley Limited.
1. Weighted Average Lease Expiry (WALE) by income
2. Based on an as completed value
3. Kew property settlement is subject to satisfaction of Conditions Precedent
4. As at 31 December 2021, including acquisitions exchanged to be settled
5. Includes current and contracted assets
Centuria Capital Group secures a $70.6 million industrial logistics facility in North Rocks, NSW, on behalf of US private investment firm, Starwood Capital’s, Last Mile Logistics Partnership (LMLP).
Centuria Capital Group has successfully exchanged conditional contracts to divest two adjoining industrial facilities located at 114 and 120 Old Pittwater Road, Brookvale NSW, which is anticipated to deliver a forecast 13.8% IRR to the assets’ closed-ended fund investors.