Impact Healthcare REIT has exchanged contracts to buy 40-bed Holly Lodge Care Home in Shildon, County Durham, for £1.4m.

The investment is the second of four target transactions that the company announced last month, which together would add more than 450 beds. As reported yesterday (Monday 5 November), Impact bought Rosepark Nursing Home and Croftbank Care Home in Uddingston, Lanarkshire, for £11.6m.

Holly Lodge, which was built in 2005, is operating at full capacity and is rated Good by the Care Quality Commission (CQC).

Careport Advisory Services Ltd, one of Impact’s existing tenants, operates the home under the Mariposa brand on behalf of the sellers, Monarch Alternative Capital LP.

Careport will continue to operate the home under a new fully repairing and insuring lease with a term of 25 years and no break clause. It will be subject to annual upward-only rent reviews linked to the retail price index, with a floor of 2% p.a. and a cap of 4% p.a.

The deal will complete once regulatory approvals have been received from the CQC.