Nursing home acquisitions lift Parkway Life Reit’s H2 DPU by 2.1%

RECENT acquisitions of nursing homes lifted Parkway Life Reit : C2PU 0%’s distribution per unit (DPU) by 2.1 per cent to 7.48 cents, for the six months ended Dec 31, 2023.

The Reit’s acquisition of five nursing homes in September 2022, and two more in Osaka, Japan in October 2023, helped boost H2 gross revenue by 4.7 per cent to S$73.1 million.

The Reit – which has 63 healthcare properties in Singapore, Japan and Malaysia – also enjoyed higher rent from its Singapore properties, under new master lease agreements that commenced in August 2022.

With the top line increase, Parkway Life Reit’s H2 net property income (NPI) was up 4.8 per cent to S$69 million.

For the full FY2023, Parkway Life Reit’s DPU was up 2.7 per cent to 14.77 cents. Gross revenue rose 13.5 per cent to S$147.5 million, while NPI climbed 14.1 per cent to S$139.1 million.

The Reit’s total portfolio size stood at S$2.23 billion as at end-2023, and it sees itself being “in a good position to benefit from the resilient growth of the healthcare industry in the Asia-Pacific region”.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

On the debt front, Parkway Life Reit’s gearing stands at 35.6 per cent. It has no immediate long-term debt refinancing needs till March 2025; the Reit had acquired six committed and long-term new facilities, comprising a mix of Singapore dollar and Japanese Yen loans.

The loan proceeds will be used to finance renewal capex works at Mount Elizabeth Hospital, refinance loans due in 2024 and 2025, and term out the short-term loan drawn down upon for the Japan acquisitions.

Units of Parkway Life Reit ended Thursday at S$3.50, down S$0.02 or 0.6 per cent.