care home

Property investor exchanges contracts to acquire care home for £8.4m

Commercial property investor LXi REIT has exchanged contracts to acquire a Leeds care home for £8.4m.

Priory Care Home was purpose-built in 2010 and comprises 75 en suite bedrooms across three storeys.

The acquisition is being funded from equity resources, with senior debt finance expected to be introduced in the near term.

Completion is due to occur by 9th June.

“We are pleased to have acquired the Priory Care Home, Leeds, which provides the company with an attractive net initial yield of 6.3% and a long, secure income stream with rare annual RPI rent reviews,” said John White, partner of LXi REIT Advisors Limited.

“This acquisition, our 10th since IPO, means that the company now has 12 strong tenants with exposure to six distinct sub-sectors and has deployed 80% of its net equity.”

The property is fully let to Priory Elderly Care Limited and guaranteed by mental health care provider Priory Investments Holdings Limited.

Priory Care Home has an unexpired lease term of just under 23 years without a break, and is subject to annual upward-only rent reviews index-linked to the retail price index.

The next rent review is due in March 2018.

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