25th Sep 2025 09:46
(Alliance News) - Target Healthcare REIT PLC on Thursday announced the disposal of nine UK care homes above carrying value, the completion of its debt refinancing, details on its acquisition pipeline and the appointment of a chief financial officer by its Investment Manager.
The real estate investment trust said the GBP85.9 million care home sale was the largest since its initial public offer in 2013, with the sale price representing a 11.6% premium to the group's carrying value as at June 30 and an implied net initial yield of 5.24%.
Target Healthcare REIT said the "highly accretive" sale reduces its exposure to its current largest tenant, HC‑One/Ideal Carehomes, to 8.8% from 16.0% based on rental income.
In addition, the firm said it has refinanced its banking facilities at improved terms with the Royal Bank of Scotland PLC and HSBC UK Bank PLC, part of HSBC Holdings PLC, replacing the existing GBP170 million facilities, which were due to expire in November.
Kenneth MacKenzie, chief executive at Target Fund Managers Ltd, said the disposal was a "strong validation" of the firm's portfolio valuation, while the refinancing was a "significant milestone."
"The disposal proceeds combined with the new debt facilities provide us with significant financial flexibility to invest in new assets and improve the quality and scale of the portfolio, whilst benefiting from the yield differential we expect to achieve" he added.
Target Fund Managers is the external Investment Manager and Alternative Investment Fund Manager for Target Healthcare REIT. On Thursday, it said it has appointed Alastair Murray as chief financial officer, replacing Gordon Bland whose resignation became effective in June.
Target Healthcare REIT said it has a strong pipeline of near-term assets at a net initial yield of around 6%, comprising a combination of accretive investment opportunities and new purpose-built, forward-funded assets.
The acquisition of the first of the existing care homes in the pipeline is expected to take place in November, the firm added.
"Executing on the rest of this pipeline of assets is expected to utilise fully the proceeds from the disposal as well as making efficient use of the new debt facilities," the company said.
Shares in Target Healthcare REIT were up 0.6% at 95.00 pence each in London on Thursday morning.
By Jeremy Cutler, Alliance News reporter
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