ASX-listed Generation Healthcare REIT has reached financial close on its $120 million stage 2 project at Casey, Victoria and started work on the $45 million expansion of Frankston Private Hospital.
GHC CEO Miles Wentworth said both projects are forecast to deliver a significant contribution to FY18 earnings on their completion.
The Casey stage 2 project is in partnership with Australia’s largest not-for-profit private hospital operator, St John of God Health Care and will deliver an 18,000 sqm private hospital located adjacent to the recently completed Casey Specialist Medical Centre.
The private hospital will comprise 190 beds, six operating theatres, six birthing suites, a cardiac/vascular catheter laboratory, two endoscopy theatres; medical consulting suites; and 12,000 sqm of underground car parking (approximately 350 additional car parks).
Hansen Yuncken has been contracted as the project builder, with ANZ Banking Group providing project debt finance. Work on site will commence shortly, with completion forecast in the second half of FY18. SJGHC has a head lease over the hospital premises and 188 of the 350 car parks, both for an initial term of 20 years, with the initial rent determined using the GHC return on total project cost model.
The Frankston Private expansion project will deliver 60 inpatient beds; two additional operating theatres; and 99 underground car parks.
National Australia Bank, the Fund’s existing debt provider to the Frankston Private joint venture, will finance the project and Watpac has been selected as the project builder. Site works have commenced and the project is forecast to complete in the first half of FY18.
Healthscope has pre-committed via an Agreement for Lease, to head lease the new facility. The initial lease term will be 20 years with the initial rent determined using the GHC return on total project cost model.
At the same time, GHC has acquired six ground floor retail suites and 30 car parks at Waratah Private Hospital for $5 million plus costs.
GHC has entered into a 20 year net lease with the hospital operator who will utilise the space for an expansion of the hospital with a particular focus on outpatient services. The initial rent represents a circa 7% yield on the acquisition price. Settlement is scheduled for 15 January 2016.
Australian Property Journal
