An £18.6m valuation gain helped to boost net asset value per share by 6.4 per cent to 76.3p for MedicX Fund (MXF) for the year to September 2017. Rental income grew by 5.6 per cent to £37.1m, with pre-tax profit up from £28.2m to £38.6m.
But while valuation gains underlined the attractiveness of the primary healthcare assets, rental growth continued to be held back due to a lack of new schemes against which to benchmark higher rents, although there is an increasing acknowledgement from district valuers that rising land and build costs are supporting rent increases. And some rents have been increased as they are linked to the retail prices index.
A total of £49.4m was invested in new schemes, the company has maintained a very disciplined approach because asset prices continue to grow strongly. The fund also completed its first forward funding agreement in Ireland, with a rent roll of just over €1m (£880,000) per year.
Analysts at Peel Hunt are forecasting adjusted net asset value at the September 2018 year-end of 76.8p a share from 76.5p in 2017.
