[SINGAPORE] Parkway Life real estate investment trust (Reit) has acquired three nursing homes in France for 38.8 million euros (US$43.5 million), expanding its presence in its third key market outside Singapore.
The debt-funded acquisition is expected to be completed by December. The properties will be leased back to DomusVi Group, the third-largest aged-care operator in Europe, which is selling the nursing homes to Parkway Life Reit.
The Reit’s French portfolio will expand to 14 properties after completion, with an aggregate value of about S$234.3 million, representing about 10 per cent of its assets under management, said its manager on Wednesday (Oct 14).
“Building on our partnership with DomusVi since 2024, this offmarket transaction expands our footprint in France and positions us to capture further growth opportunities,” said Yong Yean Chau, the manager’s chief executive and executive director.
Long-term leases
The three nursing homes are located in the Provence-Alpes-Cote d’Azur region, in and around Marseille, France’s second-largest city. Their catchment areas have established elderly populations, supporting demand for aged-care services, said the Parkway Life Reit manager.
Each property is subject to a 12-year lease, which the manager said would provide the Reit with “enhanced income visibility and a stable and resilient income stream”.
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“The lease structure also provides a natural hedge against inflationary pressures, supporting the sustainability of rental income amid rising operating costs and interest rate volatility,” said the manager.
The total acquisition outlay, including estimated capitalised costs and other acquisition-related expenses, is expected to be about 43.4 million euros, the manager added.
The Reit’s aggregate leverage is expected to rise from about 33.8 per cent as at Jun 30 to about 35.3 per cent once the deal is complete.
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The Reit made its first investment in Europe in 2024, acquiring 11 nursing homes in France for about 111.2 million euros.
It also sold a Japan nursing home property for 1.165 billion Japanese yen (US$7.2 million) in June this year to recycle capital.
Units of Parkway Life Reit closed flat at S$3.99 on Tuesday.