To The Moon

🌟🌟🌟In the midst of volatile markets, $ParkwayLife Reit(C2PU.SI)$  is a resilient Heathcare Reit which achieved its 16th consecutive year of uninterrupted distribution per unit (DPU) growth since its IPO, excluding one off divestment gains in FY2015 and FY2017.  In FY 2023, its DPU reached a record high of 14.77 cents.

Parkway Life REIT is one of Asia's largest listed healthcare REITs by asset size.  It invests in income producing real estate and real estate related assets that are used primarily for healthcare and healthcare related purposes.  These include hospitals, healthcare facilities used in connection with healthcare research, education and the manufacture or storage of drugs, medicine and other healthcare goods and devices.

PLife REIT owns a well diversified portfolio of 63 properties located in the Asia Pacific region, with a total portfolio of approximately SGD 2.23 billion.  In Singapore, it owns the largest portfolio of strategically located privates hospitals comprising of Mount Elizabeth Hospital, Gleneagles Hospital and Parkway East Hospital. 

In addition to that, PLife REIT has 59 assets of high quality nursing homes and care facility properties in various prefectures of Japan.  It also owns strata titled units of MOB Specialists Clinics in Kuala Lumpur Malaysia. 

On July 26, PLife announced its results for the first half year ended 30 June 2024.  The Group has increased its DPU by 3.5% to 7.54 cents compared to 7.29 cents in 1H 2023.

Due to the depreciation of the Japanese Yen, Gross Revenue for 1H 2024 decreased marginally by 2.7% year on year to SGD 72.4 million.  However this was partially offset by the contribution from 2 nursing homes PLife acquired in October 2023.  1H 2024 net property declined a marginal 2.5% to SGD 68.4 million from SGD 70.1 million a year ago.

As at 30 June PLife has put in place Japanese Yen forward income hedges till 1Q 2029 with about 90% of interest rate exposure hedged.   There is no immediate long term debt refinancing needs till March 2025.

PLife has a weighted average term to maturity of 3.3 years and interest coverage ratio of 10.6 times.  Gearing remains healthy at 35.3% well within the regulatory gearing limit of 50%.

Performance wise, PLife is up 2.4% in the past 5 days and in the past month, it has risen 8.7%.  PLife is now up 4.6% year todate.

Financial analysts are bullish on PLife with a Buy rating, Target price of SGD 4.62.  DBS Financial Analyst even called PLife REIT a "rare jewel".

I have invested in PLife REIT since 2021 and have enjoyed the nice steady dividends paid every 6 months.  However due to rising interest rates by the Feds, PLife's share price has taken a hit.  Thankfully with the much anticipated  interest rate cut by the Feds in September, PLife's share price has shown green shoots of recovery. 

I like PLife as it is a resilient Reit in the healthcare sector.  It has an excellent management team that was able to navigate the high interest rate environment with well thought out hedges in foreign exchange currency.  I also like PLife's sponsor which is $IHH(Q0F.SI)$ IHH Healthcare, one of the largest healthcare companies in Asia. 

$ParkwayLife Reit(C2PU.SI)$  ticks all the core fundamentals of an excellent REIT and is part of my long term core portfolio.  Healthcare is an essential service that will continue to grow exponentially as people age especially in Japan. 

Parkway Reit will weather the economic cycles in good times and bad times.  The best part is the nice steady DPUs which is a great source of passive income while waiting for capital growth. 

Go Long Go Strong Go ParkwayLife REIT! 

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