Impact Healthcare REIT has reported 2022 pre-tax profit of £16.89 million, down 47.2 % on the £31.97 million reported for 2021.

Impact acquires, renovates, extends and redevelops healthcare real estate assets in the UK and lets them on long-term full repairing and insuring leases to healthcare operators, particularly care home businesses.

The real estate investment trust’s net asset value at the end of 2022 was £445.9 million (+13.1%) or 110.17p per share (-2%), (year-end 2021: £394.2 million; 112.43p per share).

Impact’s property investments were independently valued at £568.8 million at the end of 2022, up 14.3% (year-end 2021: £496.9 million).

Four quarterly dividends of 1.635p for the year were declared, totalling 6.54p per share, an increase of 2% (2021: 6.41p per share).

Impact’s annual contracted rent roll grew by 13.6% to £43.1 million (year-end 2021: £38 million), mainly as a result of the acquisition of 12 properties and rent reviews on 107 properties.

Rupert Barclay, chairman of Impact Healthcare REIT, said: “We are continuing to deliver a strong financial and operational performance, benefitting from our robust, long-term and responsible business model and resilient and defensive portfolio, with annual inflation-linked upward-only rent reviews in 100% of our leases. This underpinned the delivery of our dividend target of 6.54p per share, which was fully covered by our earnings. We remain disciplined in investing capital, while managing the business efficiently and maintaining a conservative balance sheet, helping to ensure we continue to focus on growing the portfolio responsibly and accretively and creating further value through asset management and by funding development.

“2023 has started with continued high levels of volatility in financial markets. While healthcare is not immune, the essential nature of our tenants’ services – which translated into zero voids and 100% rent collection for 2022 as well as further rental growth – are expected to continue to help our asset values to hold up much better than most other real estate subsectors. At the same time, the returns available to us on acquisitions and asset management projects remain above our cost of capital, and rising rents over the life of our leases, all of which are long duration with inflation-linked rent reviews, should support capital growth.

“What we can be certain about is that care homes are critical social infrastructure, which provides an essential service for vulnerable elderly people. Demand for that service is driven by demography and acuity, and is not directly related to developments in the wider economy or financial markets. This gives care home operators a higher level of in-built resilience than tenants in many other real estate sectors, demonstrated in part by their ability to pass through inflation in the fees they charge for care. The investments and acquisitions we’ve made and the inflation-linked rental growth in 100% of our leases leave us well-positioned for future earnings growth and a progressive dividend.”