$69 postpage LB

HomeCo (ASX: HMC) steps up the establishment of HealthCo REIT

  • December 04, 2020 12:12 PM AEDT
  • Kunal Sawhney
    CEO Kunal Sawhney
    2345 Posts

    Kunal Sawhney is founder & CEO at Kalkine and is a richly experienced and accomplished financial professional with a wealth of knowledge in the Australian Equities Market. Kunal obtained a Master of Business Administration degree from University of T...

HomeCo (ASX: HMC) steps up the establishment of HealthCo REIT


  • HomeCo is accelerating the incorporation of HealthCo REIT with six acquisitions. 
  • It is launching a $125 million fully underwritten placement.
  • The company has upgraded FFO/security guidance by 4% from the earlier forecast.
Gold MTF non-AMP

Home Consortium (ASX:HMC) has announced the acquisition of several properties for an initial investment of $62 million and a total investment of $131 million including fund through contributions. 

It is acquiring a portfolio of six properties, which includes health, education, and Government services. 

© Kalkine Group 2020

These acquisitions are consistent with the strategy to increase exposure in health, wellness, and Government assets.

HomeCo has also entered an agreement to acquire Gregory Hills Home Centre, NSW. It is paying a total consideration of $32 million for this acquisition, which expands its footprint into the Western Sydney growth corridor. 

Health, Wellness & Government REIT

The proposed acquisition of six properties would increase HomeCo’s exposure to health, education, and Government assets to more than $400 million. 

It also enables HomeCo to establish a second standalone fund, which would be managed by HomeCo in the first half of 2021. 

Subject to regulatory approvals, the REIT would appoint advisors to assist with HealthCo’s private institutional sell down and IPO before the end of CY2020. HomeCo is targeting the establishment of HealthCo REIT in early 2021. 

Capital Raising 

HomeCo is also launching a $125 million fully underwritten placement at an issue price of $3.80 per security. It would use the funds to finance the acquisitions and transaction costs of the placement. 

As a result of the placement, the REIT would issue 32.9 million new securities, accounting for around 12.8% of existing HomeCo securities on issue. 

Financial Impact 

The acquisitions would increase HomeCo’s assets under management to over $1.7 billion across 47 assets. This indicates growth of 83% since the IPO in October 2019

HomeCo is now well placed to accelerate its objective to grow AUM to $5 billion over the medium term through capital recycling. 

New securities issued under the placement would be eligible for the distribution for the half-year ending 31 December 2020.

The acquisition is expected to increase HomeCo’s FFO per security to 6.9 cents per security, meaning an increase of 4% to an earlier forecast of 6.6 cents per security. 

After the placement and acquisitions, June 2020 proforma balance sheet gearing and look-through gearing is expected to decrease to 22% and 27.9%, respectively. 

Securities of HomeCo were placed on a trading half before the release of announcements today. 



The website https://kalkinemedia.com/au is a service of Kalkine Media Pty. Ltd. (Kalkine Media) A.C.N. 629 651 672. The principal purpose of the content on this website is to provide factual information only and does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) or engage in any investment activity under discussion. We are neither licensed nor qualified to provide investment advice through this platform. In providing you with the content on this website, we have not considered your objectives, financial situation or needs. You should make your own enquiries and obtain your own independent advice prior to making any financial decisions.
Some of the images that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed on this website unless stated otherwise. The images that may be used on this website are taken from various sources on the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image. The information provided on the website is in good faith, however Kalkine Media does not make any representation or warranty regarding the content, accuracy, or use of the content on the website.


We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK