The total investment of £45 million across the two transactions reflects a blended net initial yield of over six percent, reinvests more than half of the proceeds from the recent disposal of nine care homes, and is immediately earnings accretive.
The three operational homes, acquired via sale and leaseback from an experienced operator, feature 100 per cent en suite wet-room provision and have consistently delivered strong rent cover of more than twice the lease cost. Serving a private-pay client base, the properties are secured by 35-year full repairing and insuring leases with RPI-linked caps and collars and incorporate energy usage data collection provisions to support ESG initiatives.
The fourth property, pre-let to the same operator, is under advanced development and expected to reach practical completion in summer 2026. It will offer 100 per cent en suite wet-room provision, exceptional ESG standards, and net zero carbon operational capability.
John Flannelly, Head of Investment at Target Fund Managers, said:
“These acquisitions demonstrate our ability to execute deals efficiently and redeploy capital into high-quality real estate at attractive yields. The profitability and rent cover from these care homes underpin secure, long-term rental income. We are also pleased to partner with a highly experienced operator with a strong regulatory track record. Further transactions are currently in due diligence, and we anticipate additional announcements in due course.”
The acquisitions follow the September disposal of nine care homes for £85.9 million, the largest disposal since the company’s IPO, completed at an 11.6 percent premium to the Group’s carrying value as of 30 June 2025.
