Impact Healthcare has announced the sale of five care homes for £8.8 million as part of its active portfolio management strategy. These homes were initially acquired as part of the company’s IPO seed portfolio in May 2017.

The properties sold include three care homes in East Yorkshire: Ashgrove Care Home in Cleethorpes, Emmanuel House in Hessle, and Hamshaw Court in Hull. These homes were sold for a total of £4.3 million to a local care home owner and operator. The sale is contingent upon the re-registration of care home operations from the current tenant, Minster Care Management Limited, to the new owner, subject to approval by the Care Quality Commission. The completion is expected in the third quarter of this year.

Additionally, two other care homes, Eryl Fryn Care Home in Llandudno and Stansty House Care Home in Wrexham, were sold for £4.5 million to an affiliate of Minster. A second independent valuation confirmed the sale price for these transactions.

The sold properties were considered non-core assets due to their smaller size, lower energy performance certificate (EPC) scores, or a history of under-performance. Post-sale, Impact Healthcare’s portfolio will consist of 135 properties. The disposal is expected to enhance the sustainability of the portfolio by reducing exposure to properties with lower EPC ratings and higher CO2 emissions.

Impact Healthcare’s unlevered internal rate of return (IRR) on these non-core homes from purchase to sale was 6.6% per annum, while the overall IRR on the Minster and Croftwood IPO seed portfolio from May 2017 to March 2024 stands at 10.5% per annum.

These transactions will also decrease the group’s reliance on its largest tenant, further diversifying its portfolio.