Centuria secures $466m+ of healthcare properties across Australia and New Zealand
$466m of acquisitions secured within past two months; recent key transactions include:
- NZ$291m aged care portfolio acquisition; 38 NZ facilities; blue-chip operator Heritage Lifecare
- 30 year sale and leaseback transaction; triple-net leases; 100% occupancy1
- Acquired by two Centuria unlisted open-ended funds:
- Centuria Healthcare Property Fund (Australia) – 13 assets
- Centuria New Zealand Healthcare Property Fund (NZ) – 25 assets
- $76m Varsity Lakes Day Hospital acquisition; anchored by Queensland Health; 6.6 year WALE2
- $38m healthcare development site, Alexandria NSW
Leading Australasian real estate funds manager, Centuria Capital Group (ASX:CNI or “Centuria”), has rounded off the 2021 calendar year with a raft of healthcare real estate acquisitions across both sides of the Tasman, totalling, c.$466 million throughout the past two months.
Among the key transactions is a portfolio of 38 geographically dispersed New Zealand aged care properties for NZ$291 million (c.A$276 million3), secured on a 30 year4 sale and leaseback triple-net lease agreements providing 100% occupancy1. The assets will be operated by leading New Zealand provider, Heritage Lifecare.
Approximately 36% of the NZ portfolio, including 13 assets, will be owned by the open-ended Australian-based Centuria Healthcare Property Fund (CHPF), which adds to its existing portfolio of 18 assets worth c.$415 million5.
The remaining 64% of the NZ portfolio, including 25 assets, will be owned by the new unlisted Centuria New Zealand Healthcare Property Fund (CNZHPF).
Andrew Hemming, Centuria Health’s Managing Director said “We are expanding the geographical diversification of CHPF with the fund’s first foray into the New Zealand healthcare real estate market. We believe demand for aged care real estate within New Zealand will continue to increase due to the undersupply of existing facilities and an increasing ageing population.”
CHPF also recently secured the Varsity Lakes Day Hospital for $75.7 million. The modern, purpose-built facility, located at 2 Lake Street, Varsity Lakes QLD, is anchored by Queensland Health, providing a 6.6 year WALE and 100% occupancy6. Facilities include six digitally integrated operating theatres, 24 consulting suites, physiotherapy, gym facilities, retail tenancies and a diagnostic imaging tenancy housing MRI, CT and X-ray.
Another key acquisition is $38 million site in Sydney’s eastern suburb of Alexandria, which was secured for potential future development of a significant healthcare property.
Mr Hemming continued, “The Varsity Lakes Day Hospital is a rare high-quality facility on the Gold Coast, underpinned by strong tenant covenants and a resilient tenant profile. We foresee rising demand for these types of hospitals where the models of care promote better healthcare outcomes and are more cost-effective. The Varsity Lakes acquisition provides our CHPF investors with an immediate revenue stream while the Alexandria site acquisition presents an opportunity to unlock further value through development.”
Jason Huljich, Centuria Group Joint CEO, continued, “These acquisitions provide unique opportunities to secure high-quality assets, further expanding Centuria’s healthcare platform across both Australia and New Zealand. We have continuously grown our healthcare portfolio since 2019 alongside our investments in office and industrial, and more recently, daily needs retail, large format retail and agriculture.”
1. At settlement
2. Weighted Average Lease Expiry as at December 2021
3. Exchange rate of 1 NZD = 0.946776 AUD as at 16 December 2021.
4. At settlement
5. AUM includes direct and indirect interest in Nexus Property Unit Trust, assets on an as if complete basis and exchanged acquisitions to be settled
6. Occupancy as at December 2021 totals 83% with 17% vacancy covered by a 24 month rental guarantee
Centuria Capital Group secures a $70.6million 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.