Assura strikes £250m deal with USS pension scheme
Healthcare property specialist Assura plc has struck a deal with the pension fund the Universities Superannuation Scheme Limited (USS), to invest £250m in a joint venture to build essential NHS infrastructure.
The joint venture aims to initially build a portfolio of £250 million over the next three years, with potential to grow to £400 million thereafter.
The joint venture will focus exclusively on assets let directly to NHS or GP tenants with rents linked to inflation or with fixed uplifts.
Altrincham-based Assura will retain a 20% equity interest in the JV and act as property and asset manager, receiving asset management fees linked to the valuation of the portfolio.
USS, the principal pension scheme for UK university staff has over £75bn of assets under management, and the deal with Assura will be seeded with an initial agreed portfolio of seven assets (£107 million), transferred from Assura’s existing portfolio at a small discount to the March 2024 valuation.
The transaction will further strengthen Assura’s balance sheet, bringing additional diversity to the available funding sources to support Assura’s continued growth trajectory.
The net cash proceeds received (£85 million) will be recycled into Assura’s attractive pipeline of acquisition and development opportunities across medical centres and broader healthcare markets.
Lazard & Co., Limited acted as exclusive financial adviser to Assura.
Assura also announced its results to the stock market this morning, revealing a 4% increase in its rental income to £143.3 million.
Jonathan Murphy, Assura CEO
Jonathan Murphy, CEO of Assura, said of the USS deal: “As well as demonstrating our ability to re-deploy capital into our pipeline of opportunities in broader healthcare markets, we have sourced new capital that will fund investment in healthcare infrastructure that is so badly needed to enable better health outcomes.”
On the results he said Assura’s £2.7bn portfolio delivers high-quality cash flows, against a turbulent economic backdrop.
Alex Turner, Head of Property at USS, said: “We are looking forward to working with Assura on this exciting joint venture. As a long term investor, we believe that investing in important UK infrastructure and paying our members pensions are strongly aligned as these kinds of assets can provide inflation-linked income over many years. Healthcare is a very important sector and we’re delighted to support investment in essential social infrastructure.”
