Growthpoint Healthcare Property Holdings launches with R2.4bn portfolio
Growthpoint Properties has launched an unlisted healthcare real estate investment trust (REIT), called Growthpoint Healthcare Property Holdings.
Its first close attracted capital commitments of R285m from third parties. It is expected to raise at least double that again in the next 12 months, Growthpoint said in a statement.
Growthpoint Healthcare will be managed by Growthpoint Management Services. It aims to increase the Growthpoint Healthcare’s scale for investors and grow it towards R10bn in assets and a stock exchange listing.
The new property holding vehicle invests exclusively in healthcare assets in South Africa occupied by licenced operators of hospitals, clinics, pharmacies, and laboratories. Its focused investment mandate differentiates it in the market.
Growthpoint Healthcare already holds five assets in the healthcare property sector valued at R2.4bn. The portfolio has a weighted average lease length of about nine years reflecting the defensive nature of investing in healthcare real estate.
Two of its healthcare properties are operated by private healthcare provider Busamed, and one each by JSE-listed healthcare players MediClinic and Netcare. In addition, Netcare also rents 50% of the space in N1 City Medical Chambers, the medical suites adjacent to the N1 City Hospital.
It also has a R750m pipeline of hospital developments, which will benefit from Growthpoint’s well-established property development expertise. The first is a new R450m specialist hospital that will break ground in June this year.
Another R300m specialised facility is in advance discussions. Growthpoint also has several acquisition and development opportunities on the horizon, which are being evaluated.
Growthpoint provided R2.1bn to acquire the Growthpoint Healthcare’s starting portfolio, a portion of which has been converted into equity leaving Growthpoint as the anchor investor with an equity investment to R650m on the first close date. The remainder is a R1.4bn loan to Growthpoint Healthcare, which will be settled over time as the company raises further capital.
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