Strong valuation gains, primarily the result of further yield contraction, have continued in Q2. Adjusted NAV has increased despite continuing dividend distributions. Asset growth appears consistent with our estimates and our underlying forecasts (excluding valuation gains) are unchanged. NHS planning suggests good growth prospects for the primary care property sector, and MedicX Fund offers a low-risk approach; it is neither developer nor operator but a long-term investor. A broad portfolio of modern primary care properties, long, quasi government-backed leases, and similar duration fixed-rate debt with modest (c 50%) gearing, provide secure cash flows to support the greater than 7% prospective yield.
