Centuria boosts $1.7b healthcare portfolio with Kew hospital

Funds manager and developer group Centuria Capital has kick-started the development of its latest project, a $75 million private hospital in Melbourne’s east as it builds a $1.7 billion portfolio in the booming healthcare sector.

Construction of Adeney Private Hospital will be operated by a doctor-led joint venture with Medibank’s Amplar Health business, covering 4696 square metres and located on the corner of Adeney Avenue and Cotham Road in the eastern Melbourne suburb of Kew.

The new hospital replaces a decommissioned 1970s hospital on the same 209 Cotham Road site, which was demolished in May 2022.

Centuria Prime Partnerships (CPP), a joint venture between Centuria and an investment vehicle sponsored by Morgan Stanley Real Estate Investing, is developing the property and will retain ownership on completion in mid-2024.

Centuria Healthcare managing director Andrew Hemming said the hospital would aim to align the interest of patients and operators and create more “cost-effective and care-oriented outcomes”.

“Centuria has worked closely with the operator to design a fit-for-purpose property that caters to modern healthcare procedures, including specifically curated operating theatres and recovery spaces to maximise operational efficiency,” Hemming said.

The operator has committed to a 20-year lease and the Victorian-based construction company, Hansen Yuncken, is the appointed building contractor.

Healthcare real estate has grown into a mainstream sector with Dexus, Charter Hall, the HomeCo business’s newly listed HealthCO Healthcare & Wellness REIT, Elanor Investments and Queensland Investment Corporation (QIC) all investing in a range of private hospitals, mental health facilities and diagnostic imaging.