Aviva Investors has acquired a portfolio of care home investments from Frontier Estates for £71 million as part of its continued investment into high quality, long income real estate in the UK.
The forward funding will take place over the next two years and, upon practical completion, will be let to One Housing for 30 years. The assets will be run as private-pay facilities under One Housing’s Baycroft brand.
The assets are located in Bedford, Letchworth, Flitwick and Watford and will include 308 beds of purpose-built, high-quality care home provision.
The transaction follows the recent investment in a modern office building in Bristol, pre-let on a 15-year lease to Babcock Integrated Technology. The Fund plans to complete several further new investments this year.
Mark Wells, Origination Manager, Aviva Investors, said:
“Frontier Estates is developing an impressive high-quality care home offering over these four sites. Coupled with a strong tenant in One Housing, this creates a robust investment for the Lime Property Fund. We are actively investing in such properties and have a strong pipeline of ongoing opportunities that will support our efforts to grow the platform.”
Duncan Ford, Head of Healthcare at Frontier Estates, said:
“With many healthcare industry analysts predicting that the UK will need something like 70,000 new care home bed spaces during the next five to seven years alone, we will continue to use our unrivalled site acquisition programme and 15 years’ experience of working in the sector to help our care home operating partners scale-up their expansion plans in the right locations for them”.
Andrew Winstanley, Managing Director of Baycroft, said:
“There are two halves to high-quality elderly care, the service given by committed people and the environment. We are very proud that our beautiful designs have come to fruition thanks to Frontier Estate’s development team. There is urgent demand for more care homes right now, and the need is only going to increase. This makes well managed care a strong investment.”
Lime Property Fund is a secure income long lease property fund managed by Aviva Investors with over £2 billion of net asset value. The fund, launched in 2004, targets property investments let to strong tenants on leases with inflation-linked or fixed-rental uplifts and lease terms of 15 years plus.