HCW Resolves Healthscope Leases; Restores 1.5cpu

HealthCo Healthcare and Wellness REIT (ASX:HCW) said binding agreements have been executed for the remaining 10 Healthscope hospitals owned by HCW and the Unlisted Healthcare Fund, supporting reinstatement of distributions, subject to final lender consent and other customary approvals expected imminently.

New leases are on a state-by-state basis with Healthe Care (VIC), Acurio (NSW) and KnG Group (QLD). HCW expects the $1.35bn portfolio valuation to remain stable, largest tenant concentration to fall from 57% to 31% on a look-through income basis, and portfolio WALE to extend by 2.9 years to 13.5 years. Leases are 20 years with face rents maintained, annual escalations at CPI or +3%, and an overall incentive of about 12% funded from existing liquidity. Transition to new operators is targeted by 30 November 2026, with Healthscope continuing under existing leases until then, subject to regulatory approvals and licence transfers. HCW declared a 1Q FY27 distribution of 1.5 cents per unit for 1 July to 30 September 2026, consistent with FY27 guidance of 6.0cpu, with ex-date 8 October 2026 and payment on or about 24 November 2026. HCW holds a 49.6% interest in UHF.