HealthCo Secures Full Healthscope Rent, Eyes New Tenants Amid Sale Uncertainty
HealthCo Healthcare & Wellness REIT confirms full collection of deferred and current rent from Healthscope, while advancing conditional agreements with alternative tenants for its hospital portfolio.
- 100% rent collection from Healthscope since 2023 portfolio acquisition
- Conditional agreements in place for 11 hospitals with alternative tenants
- Portfolio occupancy remains high at approximately 99%
- Pro-forma gearing at 29.2%, below target range after asset sales
- Ongoing discussions around Healthscope’s receiver-led sale process
Full Rent Recovery Secures Income Stability
HealthCo Healthcare & Wellness REIT (ASX, HCW) has announced a significant milestone in its relationship with Healthscope, confirming that all deferred rent from May to October 2025 has now been paid in full, alongside the November rent. This achievement means that since acquiring the portfolio in 2023, HealthCo and its co-landlord, the Unlisted Healthcare Fund, have collected 100% of all rent due from Healthscope, a major tenant representing nearly 60% of the REIT’s income on a look-through basis.
Strategic Tenant Transition Plans Underway
While the rent collection news is positive, HealthCo is preparing for potential changes in tenancy. The REIT has entered into conditional agreements with alternative tenants for all 11 hospitals it owns, positioning itself to swiftly transition leases should the ongoing receiver-led sale process of Healthscope not produce acceptable outcomes. These agreements emphasize continuity of hospital services, job preservation for healthcare staff, and the long-term value for investors.
Maintaining Portfolio Strength and Capital Discipline
HealthCo’s portfolio remains robust with occupancy levels around 99%, underscoring strong demand for healthcare real estate assets. The REIT’s capital position is also solid, with pro-forma gearing at 29.2% as of June 2025, comfortably below its target range, following asset sales totaling nearly $69 million. This financial flexibility supports HealthCo’s ability to manage tenant transitions and pursue growth opportunities.
Navigating Uncertainties in Healthscope’s Future
The REIT continues constructive dialogue with Healthscope’s receiver and advisers, monitoring the sale process closely. Notably, recent media speculation about a possible reconstitution of Healthscope as a not-for-profit entity has been addressed, with HealthCo confirming no formal proposals have been received. Any such proposals would be carefully evaluated against the REIT’s objectives and existing conditional agreements.
Looking Ahead
HealthCo’s proactive approach to tenant management and capital stewardship positions it well to navigate the evolving healthcare property landscape. Investors will be watching closely for updates on the Healthscope sale process and the finalisation of lease agreements with alternative operators, which will be pivotal for the REIT’s income stability and growth trajectory.
Bottom Line?
HealthCo’s full rent recovery and tenant contingency plans set the stage for resilience amid Healthscope’s uncertain future.
Questions in the middle?
- Will the receiver-led sale of Healthscope conclude with tenant arrangements acceptable to HealthCo?
- How soon might final leases with alternative tenants be executed if the sale falters?
- Could a reconstitution of Healthscope as a not-for-profit materially impact HealthCo’s portfolio and income?
