Barwon spends $124m on healthcare assets
Barwon Investment Partners has added three east coast assets to its Institutional Healthcare Property Fund (BIHPF), which now pips $1.4 billion.
In the biggest deal, the group is buying the ex-Golden Caskett office at 87 Ipswich Road, at Buranda, a pocket of Woolloongabba, in Brisbane’s inner south, for $72 million.
The vendors, Alceon and OPD, paid Tabcorp $15.5m in 2021, then repurposed the three level building as a medical centre and laboratory, and leased it, largely to the Queensland Eye Institute and another occupier for 10 years.
It contains 4600 square metres of lettable area, a rooftop terrace and 133 car parks.
It also holds significant longer term development upside; on 5562 sqm, or 1.4 acres, zoned Mixed Use, it could make way for c30,000 sqm in six storeys.
The acquisition comes 14 months since BIP outlaid c$100m for a medical centre and car park – part of which is now earmarked for a new project, PA Health Connect, at nearby 250 Ipswich Rd, directly connected to the Princess Alexandra Hospital.
Ipswich buy
In the exclusive Ipswich suburb of Brookwater, meanwhile, Barwon, for BIHPF, is paying $14m for a recently refurbished two level office developed in 2009 to accommodate a stock exchange headquarters.
Nowadays, Building 3, 22 Magnolia Drive, is fully leased to disability services provider Neta Care for its base until 2032.
“We are pleased to partner with Neta Care…and invest in a property that plays a crucial role in meeting the healthcare needs of the local community,” Barwon head of Healthcare Property, Tom Patrick, said.
“It is fantastic to own an asset in the favourable south west growth corridor of Brisbane where further healthcare services are expected to be required over the medium to long term,” he added.
Brookwater is 30 kilometres south west of Brisbane’s CBD.
Barwon invests in Westmead
In Sydney meanwhile, Barwon has outlaid c$38m for the Mons Road Medical Centre, part of the Westmead health precinct, which services Parramatta.
The Northwest managed Vital Healthcare Property Trust was the vendor; it paid the Heathley Medical Centre Property Fund No 1 $30.7m in 2016 (story continues below).
That single asset trust, managed by Heathley, outlaid just $21.5m for the property, 20-22 Mons Rd, two years earlier.
Completed in 2010, the four level building contains 2898 sqm, anchored to Sonic Healthcare arm Castlereagh Imaging.
IVF Australia is amongst one of the smaller tenants.
An unusually high 85pc of the investment’s leases have annual rent rises fixed to CPI (many commercial rental agreements have fixed rent rises with CPI reviews every few years).
“We are delighted to welcome Mons Road Medical Centre to our growing portfolio of healthcare properties,” Mr Patrick said.
“This acquisition represents an exceptional opportunity to build on our existing exposure to Sonic Healthcare, a leader in the healthcare industry while establishing our presence within the highly sought-after Westmead health precincts,” he added.
The property is adjacent to Ramsay’s Westmead Private Hospital
Westmead is 26 kms west of Sydney.
Fund on track to $2b
With the three acquisitions, BIHPF holds 29 assets worth just over $1.4b.
BIP hopes to grow this to c$2b.
“To date the fund has delivered 10.75pc per annum total return since inception in 2016,” Mr Patric said.
“Barwon plans to continue to raise additional capital for the fund with a strategic capital raise of over $300m in the next 12 months to support its continued growth, pipeline expansion and diversification,” he added.
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