This article is from the Australian Property Journal archive
WESTERN Australian property fund manager Westbridge Funds Management has spent $21 million on two blue-chip medical assets.
The two WA assets added to the Total Return Fund included Sundew Day Surgery for $13.7 million and Forrest Family Practice for $7.25 million.
“The Sundew Day Surgery and Forrest Family Practice add blue-chip income streams to the Total Return Fund to support consistency of distributions, while also capitalising on what we believe is a softening in the cycle for Australia’s sought-after medical sector,” said Simon Worth, head of capital transactions at Westbridge Funds Management.
Simon Quinn from JLL and Derek Barlow from CBRE managed the transaction for both assets.
Located in the Joondalup Town Centre, the Sundew Day Surgery is a modern purpose-built hospital tenanted by Australia’s second largest day hospital operator, Nexus Hospitals.
The hospital offers a WALE of 5.70 years with two five-year extension options, with the limited supply of suitable land in the area and strong northern corridor population growth establishing strong potential for rental uplift.
“The construction of new specialised medical facilities has fallen behind the access requirements of Australia’s growing, and ageing, population,” added Worth.
“At the same time, rising construction and labour costs to both build new facilities and replace existing facilities will continue to exacerbate the scarcity of these vital infrastructure assets, underpinning strong medium-term growth potential.”
Meanwhile, the Forrest Family Practice is located in the Bunbury Town Centre and is fully leased to national healthcare provider, ForHealth.
The asset boasts a strong WALE of 7.13 years and provides a long-term market linked income stream through CPI rent reviews and has room for minor refurbishment to boost rental and capital value.
“These two assets will play an important role in supporting the Fund’s robust income stream while we work through the value-add strategies across the Fund’s portfolio, supporting our ultimate aim of delivering the “Total Return” that’s central to the Fund’s mandate,” said Damian Collins, chairman of Westbridge Funds Management.
The Total Return Fund now comprises five assets totalling $52 million under management.
Back in March, Westbridge spent $23 million on Charter Hall Long WALE REIT’s Redbank Plains Retail Centre in Ipswich.
