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Vital buys mental hospital in Sydney

NZN 13/06/2017 Paul McBeth

Vital Healthcare Property Trust has continued its acquisition spree with the purchase of a private mental hospital in Sydney for A$30.3 million (NZ$34.5m).

The Auckland-based property investor bought the 59-bed site called The Hills Clinic, which offers specialist inpatient programmes operated by Australian private hospital operator Healthe Care, which will sign a 30-year lease with Vital.

"The Hills Clinic is Vital's fifth mental health hospital in Australia and its first in New South Wales and directly supports our scale and diversification strategy," Vital chief executive David Carr said in a statement.

"The Hills site has expansion capability, with potential for an additional 24 beds, which fits nicely with Vital's philosophy of supporting its operating partners as population growth and wider demand for mental health services increases over time."

The hospital and healthcare property developer and investor has been expanding and diversifying its portfolio since it raised $160m in a rights issue last year.

It's betting demand for its properties will grow with an ageing population and increased demand for healthcare.

The acquisition is expected to settle in July.

Vital's NZX-listed units rose 0.5 per cent to $2.235, having gained 10 per cent so far this year.

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