Home Consortium is spending $163 million on seven east coast investments.
Six, worth $131m, are essential services backed and will be held by HealthCo REIT – set to launch early next year and target assets rented to health, wellness and government groups.
The other, Gregory Hills Home Centre, in outer south west Sydney, will be controlled by the parent.
Only this retail complex and one of two Melbourne childcare centres – at 80 Homebush Drive, Tarneit – have sales contracts, according to a HomeCo presentation about the acquisition and associated $125m equity raising by Goldman Sachs.
The second Victorian investment is speculated to be in Essendon.
Another new holding is being bought on a funds-through basis: on the Gold Coast a major commercial asset to be occupied by the Queensland government and a university, which will take two years to construct.
The remaining properties are childcare facilities: one at Brisbane and two in Sydney.
If all settle, HomeCo would control 47 investments worth $1.7 billion. Its Daily Needs REIT was floated last month.
Our healthcare portfolio “the scale to establish a standalone fund”: HomeCo
Like many managers, HomeCo recently announced its intention to weight heavier with social infrastructure leased assets (story continues below).
With today’s outlay – its value for this stock increases to over $400m or as it puts it “the scale to establish a standalone fund”.
Advisers will now be appointed to assist with HealthCo’s dual track listing process, it said.
“The acquisitions announced today are an exciting step for HomeCo and increases our exposure to the opportunity for rich health, wellness and government sectors,” executive chairman and chief executive officer, David Di Pilla, added.
“Importantly, the establishment of the HealthCo REIT in early 2021, today’s $125m placement and HomeCo’s newly formed Capital Partnerships Group will set the foundation for HomeCo to accelerate growth in assets under management”.
Tarneit deal sealed at lowest yield since last boom: agents
Of the Tarneit deal, CBRE marketing agents Sandro Peluso, Josh Twelftree, Jimmy Tat and Marcello Caspani-Muto said the $6.57m price reflects a 5.75 per cent yield making it “the sharpest result for a childcare centre in Melbourne’s western corridor in the past three years”.
Appeal for the sector is increasingly coming from institutions; HomeCo holds other childcare centre investments and Charter Hall now has a social infrastructure trust for them.
Last week we reported Primewest, for a new fund, spent $17.5m on three of these assets with long leases.