PHP’s dividend growth is set to accelerate. In addition, we see a number of drivers to NAV growth. PHP invests in Government-income-backed, long leases. Two years ago, PHP extended into the Republic of Ireland (RoI), and has invested €101m in assets in newly built primary medical centres in that jurisdiction. UK assets are attractive to investors seeking low-risk assets and covenants, with upward-only rents on long leases. Notwithstanding possible rising bond yield valuations, we believe PHP’s UK assets will see an element of upward revaluation. The RoI assets have similar characteristics but trade off higher yields. We see an ongoing trend of a narrowing down of the RoI asset valuation discount vs. the UK.
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