Target Healthcare REIT has acquired four care homes from Ideal Carehomes in a sale and leaseback deal for a total consideration of £18 million, representing an initial yield in excess of 7%.
Ideal Carehomes, part of the LNT Group, has leased the care homes from the REIT for a 35-year period and the rent is subject to an annual uplift in line with the retail prices index, subject to a cap and collar.
The four purpose-built care homes have all been completed within the last 12 months and are located in Castleford, Leicester, Newark-on-Trent and Nottingham.
The deal is Target Healthcare REIT’s second care home portfolio acquisition, having acquired 3 homes from Balhousie Care for £14.2 million in March this year.
Target Healthcare REIT has now invested £32 million out of the £45.6 million it raised recently and intends to invest the rest by October 2013.
Kenneth MacKenzie (pictured), managing partner of Target Advisers who source and manage the REIT’s properties, said: “This second acquisition is another excellent deal in terms of the caring ethos of the operator, the quality of the homes and the professional staff who provide such excellent care that focuses on residents’ personal choices and independence.
“The deal, coming so swiftly after our first, also keeps us well on track to invest available funds by October. We continue to seek out investment opportunities in a growing market but we will be very strick about only committing funds to acquiring first class care homes run by those operators who show a strong focus on the care of the customer.”
Target Healthcare REIT listed its shares on the London Stock Exchange on 7 March 2013.