First Reit secures 1.7 billion yen social loan to partially fund nursing home acquisitions

FIRST Real Estate Investment Trust (Reit) has secured a 1.7 billion yen (S$16.9 million) non-recourse social loan from Japan’s Shinsei Bank, which has partially funded the Reit’s 2.6 billion yen acquisitions of 2 nursing homes in Japan.

The remaining financing of Loyal Residence Ayase and Medical Rehabilitation Home Bon Séjour Komaki was funded by Singapore-dollar debt, the Reit’s manager said on Thursday (Sep 29).

The acquisition of the trust beneficial interest of the property in Komaki was completed on Sep 27, while that of the property in Ayase was completed on Thursday.

With the Shinsei social loan, social loans and bonds will make up about a quarter of First Reit’s debt. The Shinsei social loan is not expected to have any material impact on the trust’s leverage ratio for the financial period ending Dec 31, 2022.

Shinsei Bank had assessed the social impact from providing funding for these acquisitions to include securing houses for the elderly, and promoting women’s active participation in society. The bank assessed that the loan can contribute to the United Nations’ Sustainable Development Goals of good health and well-being (goal 3), gender equality (goal 5), as well as decent work and economic growth (goal 8).