Rising rents boost profit at Assura
The healthcare property investor recorded a 12% uptick in its rent roll for the year ended 31 March 2021, helping to push pre-tax profit for the period up 37% to £108.3m. The company’s redevelopment of Timperley Library has completed.
The weighted average unexpired lease term increased to 11.9 years as of 31 March, from 11.7 years 12 months earlier and rental collection across the portfolio was “in line with normal patterns”, Assura said in a stock exchange filing today.
The Warrington-based investor also expanded its portfolio over the year through acquisitions and investments, Portfolio value grew by 15% annually to £2.45bn as of 31 March, of which the North West accounted for £326m – 51 buildings, and 14% of the total.
The company’s £2.1m conversion of Timperley Library into a modern community medical centre – a joint venture with Trafford Housing Trust as part of the latter’s £7m library redevelopment – has completed and will open to the public in the coming weeks, Assura said. The scheme’s delivery was delayed from the end of last year due to the pandemic.
Assura had an immediate development pipeline totalling £111m as of 31 March and £45m of planned acquisitions in legal hands, according to the full-year results. It completed 50 acquisitions totalling £230m over the period and 29 disposals with proceeds of £26m. The company also reported £15m of asset enhancement capital projects ongoing as of 31 March.
The loan-to-value ratio stood at 37% with gross debt standing at £957m, £225m of undrawn facilities and cash at £46.6m.
As a result of continued growth, Assura posted its eighth consecutive year of dividend growth and agreed to pay a 4.2% increase in the quarterly dividend to 0.74p per share, with effect from July.
The past year has been a “period of significant portfolio enhancement activity, growing a high-quality portfolio and replenishing its strongest ever investment pipelines with a record number of new developments”, while “resilient cash flows” further bolstered its position, it said. The company issued a 10-year, £300m social bond in September and raised gross proceeds of £185m from an equity raise last April.
Assura chief executive Jonathan Murphy said: “Over the year, we continued to build on our market-leading position, delivering a strong financial performance, a record number of new developments in local communities and significant progress on our social impact strategy, SixBySix.
“With an ageing population and challenges exacerbated by Covid-19, NHS services are under intense pressure. Well-designed and located community healthcare spaces that meet the ever-changing requirements of GPs and their patients will play an essential role in reducing this pressure on hospitals and the wider health service.
“With our largest ever development pipeline and deep understanding of the NHS, we are well placed to continue delivering such space and support it through emerging trends such as digitalisation, the integration of healthcare systems and mental health support.
“The NHS is seeking to become the world’s first net zero carbon health system and we have set tough targets for ourselves, as we believe our contribution to improving health in communities must reach far beyond our buildings.”
The company is on the hunt for further acquisitions to bolster its North West portfolio, Murphy told Place North West in an interview in January, and is particularly interested in large-scale regeneration schemes.