Healthcare property group development activity stands at record levels

Jonathan Murphy
X The Business Desk

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Assura, the Warrington-based healthcare property group, said development activity is at record levels in a trading update for the quarter to June 30, today.

Chief executive, Jonathan Murphy, said: “I am pleased to report that Assura has completed another successful quarter.

“We have continued to manage our portfolio actively by adding 12 attractive assets to our portfolio for a total of £53m and disposing of 11 mature assets for £15m.

“At the same time, our development activity is at record levels and we are currently on site at 17 locations with a total cost of £99m.”

He added: “Towards the end of the quarter we issued our first Sustainability Bond, raising £300m, which follows on from our first Social Bond last year. This is a further clear demonstration of the commitment to our communities and the wider environment across everything we do.

“We can increasingly see new ways to support the NHS in meeting its infrastructure challenges and the current development of the West Midlands Ambulance Hub is an excellent example of this. We continue to engage closely with the NHS to identify ever more innovative solutions for its needs.”

Today’s update revealed that the group’s strong track record of investment activity continued through the first quarter.

It had a growing portfolio of 610 properties with a current annualised rent roll of £123.5m. There were 12 property additions – one development completion and 11 acquisitions – for a total cost of £53m.

Two development schemes moved onto site in the quarter, including the West Midlands Ambulance Hub announced in June 2021.

Eleven disposals completed raising proceeds of £15m, above the book value at March 2021, while three lease regears completed in the period (£0.1m of existing rent).

Assura is currently on site with four capital asset enhancement projects, with a total spend £2.7m.

The group said its developments and acquisition pipeline provide significant growth opportunities.

It is currently on site with 17 developments with a total cost of £99m, compared with 16 developments, with a total cost of £72m, at March 2021.

There is an immediate development pipeline of 19 schemes, where Assura expects to be on site within 12 months, totalling a further £121m, compared with 17 schemes worth £111m at March 2021.

The immediate acquisitions pipeline stands at £58m, which the group would normally expect to complete in three to six months, against £46m at March 2021.

There are also 37 lease re-gears, covering £4.5m of existing rent roll, in the current pipeline, and a pipeline of 19 capital asset enhancement projects, with a projected spend of £16m, over the next two years.

Following the Sustainability Bond issuance, at June 30, 2021, net debt stood at £954m, with undrawn facilities of £205m and a weighted average interest rate of 2.3%.