Vital Healthcare Property Trust, which raised $160 million last month to help fund its growth strategy, reported a 21 per cent gain in full-year profit as rental income rose and it recognised a gain in the value of its portfolio.

Profit rose to $117m in the year ended June 30, from $96.5m a year earlier, the Auckland-based hospital and healthcare property developer and investor said. Net property income rose to $68m from $59m and the trust recognised a $102m revaluation gain on investment property, following an $84m gain a year earlier.

Vital raised funds in a rights offer last month to repay debt and support its push for more scale and diversification. Yesterday it flagged A$83m of new brownfield development projects across its Australian private hospital portfolio and said it was targeting A$20m of strategic acquisitions. Following the latest portfolio revaluation, the trust's investment properties are now valued at about $952m.

"Brownfield development activity over the last few years has been transformational in delivering significant financial and portfolio outcomes for investors," said Graeme Horsley, chairman of the trust's manager, Vital Healthcare Management. "The long-term characteristics of the healthcare sector and strong real estate fundamentals continue to be drivers of the portfolio revaluation gains achieved in 2016."


The trust will pay a final quarter cash distribution of 2.125c a unit, bringing payments for the year to 8.2c. It affirmed guidance for the same sized payment in 2017. Distributable income rose about 11 per cent to $40.2m.