LXi REIT has acquired in an off-market transaction a Bupa care home in Bristol for £13.8m, reflecting a 6.4% net initial yield.
The property is fully let to Bupa Care Homes Ltd and guaranteed by its parent Bupa Care Homes plc on a long lease with more than 23.5 years unexpired to first break and benefits from annual rent reviews increasing in line with RPI inflation collared at 2% per annum and capped at 5% per annum.
The acquisition has been funded using the LXi REIT’s Scottish Widows loan facility.
John White, partner at LXi REIT Advisors, said: “We are pleased to have completed this off-market acquisition, which is accretive to the company in terms of yield, lease length, rent review profile and tenant strength.
“The initial yield of 6.4% is over 340bp higher than the cost of our long-term debt facility which is funding the purchase.”
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