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HealthCo Healthcare & Wellness REIT (ASX: HCW) has secured a new operator for Perth's Mount Private Hospital, with not-for-profit provider Bethesda Health Care agreeing to take over the facility under a deal guaranteed by the Western Australian Government.
The agreement removes one of the most complex pieces from the broader puzzle of transitioning all 38 Healthscope hospitals to new operators after the embattled private hospital group entered receivership late last year.
Under the deal, the WA Government will provide financial assistance to Bethesda and contract the hospital's facilities for elective surgeries aimed at relieving pressure on public waitlists.
Bethesda will begin a new long-term lease over the Mount Private Hospital in the first quarter of FY27 after Healthscope surrenders its existing lease. Face rent on the asset remains unchanged.
The Mount Private Hospital is held by HealthCo's Unlisted Healthcare Fund (UHF), which worked alongside Healthscope's receivers at McGrathNicol and Healthscope itself to land the Bethesda arrangement.
HMC Capital managing director Sid Sharma says the agreement represents a key development for the transition of the Healthscope property portfolio.
“The agreement for the Mount, guaranteed by the WA State Government, represents an important step towards a clear resolution of the Healthscope situation," says Sharma.
"We appreciate the patience shown by our unitholders and remain focused on positioning the HCW platform for renewed growth and restoring normalised distribution settings for our unitholders."
HealthCo fund manager Christian Soberg says the Mount Private Hospital deal delivers an upgraded tenant covenant for the asset.
“The agreement for the Mount will deliver a sustainable, long-term solution that is consistent with our objectives of providing continuity of service and maintaining jobs for nurses and hospital staff," says Soberg.
"We further expect that long-term value for our unitholders will be enhanced by the improved WA State Government-backed tenant covenant."
Today's announcement also confirms that executable new lease agreements are now in place for 10 other Healthscope hospitals across HealthCo's and UHF's combined portfolio.
Three operators have been matched to facilities across three states - HealtheCare for Victorian hospitals, Acurio Health for NSW sites and KnG Group for Queensland facilities.
Face rents across those 10 hospitals also remain unchanged.
For the remaining 27 Healthscope hospitals not owned by HealthCo or UHF, alternative operators have been granted due diligence access by the receiver in a sign that the broader transition process is progressing.
Healthscope has continued to pay 100 per cent of rent through May 2026, providing income continuity for the REIT while new leases are finalised.
The news comes after a turbulent period for HealthCo unitholders.
Healthscope, which operated 38 private hospitals nationally, was placed into receivership last year but the group was supported by a $100 million emergency funding package by the Commonwealth Bank of Australia (ASX: CBA) and Westpac (ASX: WBC) to keep the hospital operator's doors open during the receivership process.
HealthCo disclosed in February this year that it had received expressions of interest from multiple alternative hospital operators and agreed to a partial rent deferral arrangement with Healthscope's receiver to maintain stability during the transition.
At that point the REIT flagged a 10 to 15 per cent indicative near-term reduction to asset valuations based on December 2025 capitalisation rates.
HealthCo and UHF hold a combined healthcare property portfolio valued at $1.4 billion.
Healthscope-tenanted assets represent a significant portion of that book, making the operator transition the defining issue for the REIT's near-term outlook.
Completion of the Bethesda lease and the 10 other new operator leases remains subject to the formal surrender of Healthscope's existing leases and satisfaction of customary conditions.
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