London-listed Primary Health Properties (PHP), whose Irish property portfolio is worth close to €100 million, has said it doesn't expect Brexit to have a direct impact on its business, no matter what the outcome is.
The group, which recently secured a €51 million, 10.4-year private placement against its Irish assets, said demand for properties is largely driven by demographics, thereby safeguarding the business to a large extent from Brexit.
“Despite the continued volatility in the economic and political environment and the prolonged era of low, albeit increasing, interest rates, there continues to be an unrelenting search for income yield across most sectors. Primary healthcare, with its strong fundamental characteristics and government-backed income, has been a significant beneficiary,” the group said.
PHP delivered a strong set of results on Friday, with earnings – as measured on a basis set out by the European Public Real Estate Association (EPRA) – rising 18.7 per cent to £36.8 million in 2018. EPRA earnings per share was unchanged at 5.2 pence, reflecting a dilution arising from a £115 million oversubscribed fundraise last April.
All-share merger
The group, whose property portfolio is worth £1.5 billion, last week announced an all-share merger with rival MedicX to create a group with almost 480 properties worth a combined £2.3 billion (€2.6 billion). Annual rental income for the combined portfolio is expected to exceed £120 million.
MedicX, formerly owned by UK-based funds management group Octopus, has four primary care schemes currently up and running in the Republic, with a fifth one in Rialto, Dublin 8, due to be completed shortly.
PHP, which on Friday announced its 22nd successive year of dividend per share growth, has eight assets in the Republic valued at €92.3 million. Including its forward-funded development in Bray, Co Wicklow, which it acquired last July, the value of its Irish portfolio increases to about €110 million.
The group’s Irish assets represent 6 per cent of its total portfolio, up from 1 per cent a year ago, with £5.7 million of annualised rental income deriving from the Republic.
"The company is in a strong position to continue to deliver long-term value to shareholders, and the board looks forward with confidence to the forthcoming year," said chairman Steven Owen.
