Target Healthc. Regulatory News (THRL)

Target Healthcare REIT Limited

RNS Announcement

15 May 2014

Acquisition of Three Modern, Purpose-Built Care Homes

Target Healthcare REIT Limited ("the Company"), a specialist investor in UK care homes, announces that it has acquired a portfolio of three modern, purpose-built residential care homes for approximately £13.9 million including acquisition costs. The transaction is in accordance with the Company's investment policy.

Located in Wigan, Stockport and Coventry, the properties are built to high specifications and offer generously proportioned bedrooms and public spaces. All bedrooms (169 in total across the three homes) have en-suite facilities, including wet room showers.

The care homes are leased to operator Ideal Carehomes Group for a period of 35 years and the price reflects an initial yield of 7%. The rents payable under the leases are subject to annual uplifts in line with the retail prices index, subject to a cap and collar.

Ideal Carehomes Group has been operating in the care sector for a number of years and benefits from LNT Group's 25 year heritage in designing, developing and operating purpose-built residential care homes for older people. Currently, Ideal Carehomes Group employs 1,800 staff across 36 residential care homes.

These acquisitions see the Company's portfolio increase to sixteen care homes in total and the Company has now invested approximately £72.7 million of the £95.7 million raised from institutional investors, wealth managers and private investors.

Kenneth MacKenzie, Managing Partner of Target Advisers LLP, commented on the acquisition:

"This acquisition follows closely on from the transaction announced last month and adds a further three high quality properties to the Company's portfolio. We continue to grow the Company's investment pipeline with both single and multi-asset acquisitions across regional and national operators. With approximately £35.5 million of deals in advanced, non-binding legal negotiations we expect to announce further acquisitions in the near-term."

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