Target Healthcare REIT posts 3.6% return

Managing partner Kenneth MacKenzie

Target Healthcare REIT recorded an EPRA net asset value (NAV) total return of 3.6% in the fourth quarter of 2016.

Unaudited EPRA NAV per share as of December 31 2016 was 102.1 pence with portfolio value rising 9% over the quarter.

Target Healthcare said: “The increase reflects our acquisitions in the period, value generated from our ongoing embedded rental uplifts, and also an element of yield compression across individual assets, including the forward commitment asset acquired in October 2016.”

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As of the end of last year, Target Healthcare owned 41 care homes with a market value of £253.1m.

The portfolio had an EPRA net initial yield of 6.7% and annual rental income of £18.2m on an average lease of 29.4 years.

Acquisitions over the quarter included a £12.2m purpose-built care home in Tonbridge, Kent, which is let to Abbeyfield Kent Society.

The Trust plans to add another new tenant upon completion of the acquisition of a £5.6m purpose-built care home in Sutton-in-Ashfield, Nottinghamshire, which is expected in April.

Target Healthcare also completed a redesign and renovation works at a Sheffield home.

Since the Company’s £84m capital raising in April 2016 (see Target Healthcare REIT raises £84 million for investment into UK care homes), the Group has completed and made firm commitments on investments of £77m and has identified near-term investment opportunities of £30m.

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