This article is from the Australian Property Journal archive
Australia’s second-largest hospital operator Healthscope could be turfed out of hospitals across the country by landlord, HealthCo Healthcare & Wellness REIT.
David Di Pilla’s HealthCo Healthcare & Wellness REIT (ASX: HCW) and the Unlisted Healthcare Fund (UHF) have issued breach notices to Healthscope for failing to pay all rent due for March 2025.
HealthCo owns 11 Healthscope hospitals, buying the portfolio in 2023 for more than $1.1 billion alongside an unlisted healthcare fund (UHF).
The landlord said only part payment has been received.
“HCW and UHF will enforce their legal rights and seek to replace Healthscope’s tenancies with other hospital operators in the event the breaches are not remedied.
“HCW and UHF are now in active discussions with alternative hospital operators,” the REIT said.
As a result, the REIT has withdrawn its FY25 FFO/unit and DPU guidance of 8.4 cents.
However it assured investors it has cash and undrawn debt facilities of approximately $100 million and will receive additional support from HMC Capital as required, including the deferral of management fees.
The latest development comes after the REIT announced last month that HMC Capital is in talks about a potential buyout of Healthscope, which is struggling with $1.6 billion of debt due to high costs.
Healthscope was turned private by Brookfield when the Canadian giant acquired the company for $4.4 billion in 2019. More recently, it has been grappling with growing costs.
