Centuria and Morgan Stanley form $210 million healthcare joint venture

Australian investment manager Centuria Capital Group (ASX: CNI) has established a new institutional healthcare property joint venture with Morgan Stanley Real Estate Investing (MSREI) to be called the Centuria Prime Partnership (CPP).

The CPP is seeded with three healthcare real estate assets collectively worth $210 million, which Centuria says are supported by strong tenant covenants and high-quality operators on long lease terms.

Further assets have been identified and it is intended additional healthcare assets will be acquired by CPP, which will be administered by Centuria. CPP comprises a 90 per cent investment from MSREI and 10 per cent from Centuria.

“We are very pleased to announce our partnership with MSREI, which provides another opportunity to utilise our strong in-house healthcare real estate capabilities and further broadens our access to additional capital sources,” Centuria joint CEO Jason Huljich said.

Centuria Healthcare managing director Andrew Hemming said the formation of the JV builds on the company’s exposure to the healthcare sector.

“Since 2019, Centuria has significantly grown its healthcare AUM to approximately $1.7 billion by focusing on healthcare real estate models of care that are cost-effective and deliver better patient care for our high-quality operational partners,” Hemming said.

“We will continue to focus on the acquisition of institutional-grade properties as well as developing out our $900 million healthcare pipeline.”

The CPP’s seed assets include the $75 million Adeney Private Hospital in Kew, Victoria which Centuria is constructing in partnership with Medibank. The facility will provide four theatres, an infusion chemotherapy clinic and 30 beds once finished in June.

The second asset is the $96 million Westside Private Hospital in Brisbane, which is currently operated by Montserrat Day Hospitals - part of ASX-listed Healius Limited (ASX: HLS).

Finally, the $39 million Mater Private Hospital in Townsville, Queensland makes up the remainder of the CPP.