Octopus Healthcare adds £133m to fund

Octopus Healthcare has added £133.5m to its care home fund, while also buying seven properties in a separate deal.

Total equity raised for the fund has reached £320m since its launch in August 2017.

The healthcare facilities investor, which has 26 care homes in its portfolio, has bought a collection of six properties in Banbury, Cheltenham, Horsham, Norwich, Ware and Witney for £110m.

The care homes have been bought from Care UK and are being let back to the operator on long leases. The deal strengthens the partnership between the two organisations, which consists of eight properties in the UK.

In addition, Octopus will pay for the development of an older people’s care home in the Midlands.

Hiti Singh, Octopus head of institutional investment, said:‘The strong fundamentals of healthcare infrastructure investment, including the sustainable, inflation-linked income, risk-adjusted returns and supportive demographics, continue to attract institutional investor demand.’

In a survey of 65 healthcare infrastructure investors, 45% of respondents said they ‘lacked’ the financial skills and resources to invest in the sector, according to Octopus.

A gap in knowledge creates an ‘opportunity’ for Octopus to expand its healthcare portfolio, while opening opportunities for other investors, said Singh.

Ben Penaliggon (pictured), director at Octopus Healthcare, added: ‘This significant new capital raise for the Octopus Healthcare Fund and the acquisitions we have announced today are a strong endorsement of both our ability to source and acquire high quality UK care homes, of the appeal of this asset class to investors, and the highly supportive demographic trends that drive it.’