MedicX Fund Limited acquires new primary healthcare centre
MedicX Fund, (LSE: MXF), the specialist primary care infrastructure investor in modern, purpose-built, primary healthcare properties in the United Kingdom, is pleased to announce that it has contracted to acquire, by way of forward funding, a new primary healthcare medical centre in Mullingar, Westmeath. The property is due to be completed in August 2016.
The completed development will be let to a number of GPs and the Health Service Executive (the Irish NHS equivalent). The GP and Health Service Executive leases will be for a term of 15 and 25 years respectively from practical completion. The rent is subject to five-yearly CPI reviews. The total acquisition cost of the property is €10.1 million.
This is the Company's first acquisition in Ireland, and has followed a significant due diligence exercise into the opportunities available in the Irish healthcare property market. It is the belief of Octopus Healthcare Adviser and the Board that Ireland offers good yields for quality properties, let on long leases, generating principally government backed income, making Irish healthcare property opportunities an attractive fit with MedicX Fund's investment objective. The yields available in Ireland are currently higher than are available for similar properties in the UK. It is anticipated that any investment in Ireland will be part funded through additional borrowings drawn in Euros, thereby providing a natural partial hedge against Euro currency movements.
The Company expects to acquire further healthcare properties in Ireland in the future. In the event that such investment opportunities become material in the context of the Company's property portfolio, shareholder approval will be sought to continue making such acquisitions through an amendment to the Company's investment policy setting out a limit as to how much may be invested outside the UK.
The MedicX Fund's total property portfolio comprises 143 properties throughout the United Kingdom and Ireland of which 134 are operational and fully let, with nine under construction. The annualised rent roll for all properties is £34.4 million.