New Zealand Professional Investment Services Firm

Forsyth Barr

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

New Zealand Professional Investment Services Firm, Forsyth Barr

Equity Bottom-Up

Vital Healthcare Property Trust / Equity Bottom-Up

<ul><li>Rising cap rates drive revaluations: Draft 2H23 revaluations of VHP's portfolio resulted in a -NZ$160m movement in asset values with +34bps increase in cap rates partly offset by rent growth and FX movements.</li><li>Asset devaluations more than priced in: The listed equity market had already more than priced in this level of cap rate expansion and asset devaluation.</li><li>Higher gearing being offset through asset sales: We estimate VHP's FY23 gearing to be c.38%, which is creeping towards its management's upper limit of 42.5%.</li></ul>

Rising cap rates drive revaluations: Draft 2H23 revaluations of VHP's portfolio resulted in a -NZ$160m movement in asset values with +34bps increase in cap rates partly offset by rent growth and FX movements.Asset devaluations more than priced in: The listed equity market had already more than priced in this level of cap rate expansion and asset devaluation.Higher gearing being offset through asset sales: We estimate VHP's FY23 gearing to be c.38%, which is creeping towards its management's upper limit of 42.5%.

Vital Healthcare: Benign Revaluation Diagnosis