Target Healthcare put two care home acquisitions on hold as coronavirus escalated in the UK, the Stirling based investor has revealed.
The real estate investment trust said in a corporate update that the pandemic had not affected its long-term business model of investing in high-quality homes across the UK to meet growing demand.
It is committed to paying a dividend of 1.67p per share for the year ending 30 June 2020, having achieved net asset value total return of 1.5%.
In the first quarter, Target bought two care homes in Scarborough, North Yorkshire, and Pudsey in West Yorkshire, providing 172 bedrooms in total. It also retenanted six care homes from Orchard Healthcare to two of Target's other operators.
The update stated that Target is currently assessing more potential acquisitions but that: "The Board, together with its Investment Manager, thought it prudent to postpone the completion of the acquisition of two quality care homes towards quarter end as the severity of the Covid-19 pandemic emerged. This position is under regular review and there is ongoing dialogue with the vendors."
Kenneth MacKenzie, CEO of Target Fund Managers, said: "Given the fast-moving nature of the Covid-19 pandemic, it is impossible to predict with any certainty what sort of impact we may see across our portfolio.
"Whilst we expect to see a small number of care homes disproportionately affected, our investment strategy has always focused on the quality and design facilities of the properties, underpinned by a forensic approach to understanding local market dynamics.
"Nothing has changed our conviction that this approach, coupled with the underlying demographic trends supporting strong demand for care home beds, will underpin the delivery of reliable and sustainable income over the long term."
