Target Information

The eQ Hoivakiinteistöt fund has made a significant investment in the Finnish real estate sector by acquiring 27 properties from the Healthcare I fund managed by Northern Horizon Capital. These properties are primarily intended for intensified service housing and were constructed between 2006 and 2012. The total leasable area of the acquired properties is nearly 50,000 square meters.

This acquisition elevates the total asset value of the eQ Hoivakiinteistöt fund to over 430 million euros, following its inception in summer 2012. Post-transaction, the fund will possess 123 healthcare-related properties within Finland, all of which are fully leased. The tenants include some of the most significant players in Finland's healthcare sector, and the average maturity of the lease agreements is long, ensuring stable rental cash flows.

Industry Overview in Finland

The healthcare real estate market in Finland has exhibited robust growth in recent years, driven by demographic shifts and an increasing demand for modern healthcare services. With an aging population, the need for specialized housing and healthcare facilities is on the rise, making this sector particularly attractive for real estate investment.

Finland's healthcare policies emphasize the importance of providing quality care, further propelling investments in healthcare infrastructure. The country has established a strong regulatory framework governing healthcare facilities, ensuring that investments are safeguarded and contributing to long-term stability in the real estate market.

The Finnish healthcare real estate sector is characterized by high occupancy rates and long-term leases, providing investors with reliable income streams. As demand for healthcare services continues to grow, the economic outlook for this segment remains positive, positioning it as a desirable sector for capital allocation.

The Rationale Behind the Deal

This acquisition strengthens eQ Hoivakiinteistöt's established position as a significant real estate investor in the Finnish healthcare market. By expanding its property portfolio, eQ aims to capitalize on the growing demand for modern healthcare facilities in Finland. The strategic alignment with major tenants in the healthcare sector ensures a stable revenue stream and enhances the fund's long-term viability.

The deal represents a proactive approach to addressing the upcoming healthcare demands in Finland while reinforcing the fund's market presence. The high-quality nature of the properties acquired aligns with the fund’s investment strategy, based on securing stable returns for its investors.

Investor Information

eQ Varainhoito Oy operates and manages eQ Hoivakiinteistöt, focusing on investments in Finnish healthcare real estate. The fund offers investment opportunities four times a year and allows redemptions twice annually. Since its launch, the fund has achieved a net return of 8.4% per annum after costs and distributes a 6% yield to its investors each year.

With a growing investment organization, eQ Varainhoito emphasizes on becoming a stronger player in the Finnish market. As stated by Tero Estovirta, Head of Real Estate Investments at eQ Varainhoito, the firm is committed to enhancing its appeal to both tenants and clients through strategic property investments.

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This acquisition is viewed as a sound investment opportunity. The integration of additional quality properties into the eQ Hoivakiinteistöt portfolio not only enhances the fund's asset diversity but also capitalizes on the burgeoning demand within the healthcare sector in Finland. As the aging population necessitates better healthcare facilities, the properties acquired are projected to provide steady cash flows and long-term stability.

The long-term leases with established healthcare operators provide a reassuring level of security, which is crucial for investors. The substantial total asset value of the fund enhances its credibility in the market, showcasing eQ's strong commitment to the healthcare real estate segment.

In conclusion, given the favorable market conditions and the strategic nature of the investment, this acquisition could potentially yield significant returns for eQ's investors in the coming years. The focus on modern healthcare facilities sets the stage for continued growth and profitability within the sector, making it an attractive choice for both current and prospective investors.

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