A $600-million precinct in Geelong and the expansion of a site in Richmond are in the works after an agreement between Northwest Healthcare Properties and Epworth Healthcare.
The development announcement also came with a $127.6-million healthcare reshuffle which sees Epworth sell off, and leaseback, a number of sites in Victoria.
Canada-based Northwest gained a 50 per cent interest in Epworth Geelong in Waurn Ponds for $89.8 million and a 50 per cent interest in 4.2ha of land next to Epworth Geelong for $15 million with a commitment to create an integrated innovation, education and healthcare precinct.
The Toronto-listed real estate investment trust also gained a 100 per cent interest in Epworth Rehabilitation, Elim in Richmond for $22.8 million plus a further $5-million option for the air-rights to further develop the site.
The facilities were subject to a triple net leaseback for an initial lease term of 20 years with annual consumer price index rent increases.
The sale also requires approval from the Foreign Investment Review Board.
The Geelong development plans included a 10-year masterplan for the site to create 100,000sq m of gross floor area for an innovation, education and healthcare precinct.
The site’s co-location with Deakin University’s Waurn Ponds Campus would also offer extensive partnership, research and collaboration opportunities.
The plans show four multi-storey buildings, of similar size to the existing facility, added to the site at the corner of Pigdons Road and Epworth Place.
This included an entry building with allied health, rehabilitation, research, education and childcare facilities.
There is also a carpark, campus edge and Epworth Place building adding aged care, med-tech, innovation and further research space to the site.
Meanwhile, the Richmond development has the potential to create 5000sq m of gross floor area with a total project cost of $23 million.
Northwest chief executive Craig Mitchell said they wanted to create a broader and deeper partnership with Epworth.
“All three transactions play to our core expertise, strengthening our relationship with Epworth, and unlocking an exciting pipeline of new health infrastructure at two major new precincts,” Mitchell said.
“We look forward to bringing together the best experts in healthcare planning and infrastructure to deliver world-class facilities on each site.”
Epworth chief executive Lachlan Henderson said the agreement freed up capital and supported the long term sustainability of the group.
“The agreement enables Epworth to focus on targeted growth, our ambitious digital program and innovation to deliver better outcomes for our patients, now and in the future,” Henderson said.
“Importantly, our patient services will continue as normal.”