The Cofinimmo Group has signed an agreement for the acquisition of two nursing and care homes project for a total amount of €26.5m. The Group's investments and commitments in healthcare real estate now total €94.5m in 2017.
Cofinimmo acquired the ‘Gelsenkirchen Bismarck park’ nursing and care home, located in Gelsenkirchen, North Rhine-Westphalia, for €11.4m. The 6,466 m² property is operated by Curanum AG München, a subsidiary of the Korian Group, under a 'double net' lease for a fixed 17-year period, with an option to extend for ten years. The initial gross rental yield amounts to 6.2 %.
The facility was built in 1998, and will soon undergo refurbishment to meet the Land's required standards. Cofinimmo and the operator will each finance part of the works. The refurbishment budget, including fees and VAT is expected to approximate €1m. Following the refurbishment, the building's capacity will decrease from 133 to 109 beds.
The Group has also signed an agreement for the acquisition of the ‘Azurit Seniorenzentrum Riesa’ elderly care development. The asset is located in the town of Riesa, halfway between Leipzig and Dresden, Saxony. The 6,450 m² project will feature 138 beds. The completion is expected in the second quarter of 2018. The property will be let to Azurit Rohr GmbH under a 'double net' lease for a period of 25 years with an option for an additional 5-year extension.
The new acquisition represents an investment of €15.1m. The initial gross rental yield will amount to 5.7 %.
Jean-Edouard Carbonnelle, Chief Executive Officer: "Both transactions are in line with the Group’s strategy to expand our healthcare portfolio in the Netherlands and Germany, where rental yields and lease length form an attractive combination for Cofinimmo and its shareholders. This strategy also aims at spreading risks associated with our tenants' activities over different countries and markets."