PHP reports robust deal pipeline in Q1
London-based primary health facilities investor Primary Health Properties (PHP) has reported a strong pipeline of investments in the first quarter of the year.
As reported earlier by HealthInvestor UK, PHP has acquired a large diagnostic centre in Chiswick, let to HCA Healthcare, for £34.5 million and a clinical facility in Chertsey, let to the NHS, for £6.95 million. The group has also announced its first NZC direct development — a new purpose-built medical centre in West Sussex.
The London-listed company said that it generated £0.9 million in extra rental income from its rent review and asset management activities in Q1.
Including standing investments, direct and forward-funded developments and asset management projects, the group had continued to generate and grow a “strong pipeline” totalling £360 million in the UK and £122 million in Ireland, of which £139 million is currently in legal due diligence.
As at 31 March, the group’s net debt stood at £1.22 billion, and on a pro-forma basis the loan-to-value ratio was 43.3%, down from 42.9% at the end of December.
After capital commitments, the group had undrawn loan facilities and cash on deposit totalling £270 million, down from £321 million at the start of the quarter, but still providing “significant liquidity headroom”.
97% of PHP’s net debt was fixed or hedged for a weighted average period of just over nine years, providing “significant protection from increasing interest rates”.
Harry Hyman, PHP’s chief executive said: “The first quarter of 2022 has seen a good start to the year for PHP good progress converting our year-end pipeline into committed deals along with stronger organic like-for-like rental growth across our rent review and asset management activities, including the environmental upgrades that are required to meet our sustainability targets.
“We expect to benefit from the current inflationary environment with an improving rental growth outlook and with the majority of our debt fixed or hedged we expect to remain in a very strong and robust position in the current volatile economic environment.
“In a capital-constrained NHS, the access to capital that our business can bring can assist with the increased utilisation of primary care in order to relieve the pressures being placed on healthcare systems, hospitals and A&E departments from demographic drivers and the backlog of procedures missed over the last couple of years following the Covid-19 pandemic. We are proud of the role we play and look forward to continuing to expand our business in the interest of the NHS and all of our stakeholders.”
Date published: April 27, 2022