KUALA LUMPUR (July 14): IHH Healthcare Bhd has signed new long-term master lease agreements for three hospitals in Singapore with Parkway Life Real Estate Investment Trust (PLife REIT).

The 20-year extension to end-2042, with a 10-year option, involves Mount Elizabeth Hospital, Gleneagles Hospital and Parkway East Hospital, the two companies said in a joint statement.

The deal also comes with a commitment from PLife REIT to invest S$150 million in capital expenditure to revamp the hospitals over three years, the companies said.

"With the new master lease agreements, IHH Healthcare's ability to continue operating the three hospitals in the prime locations of Singapore is maintained, strengthening its long-term ability and commitment to serving patients in Singapore," the statement said.

IHH's Singapore hospitals are top performers for the group, said IHH managing director and chief executive officer Dr Kelvin Loh.

"Partnering PLife REIT to extend the lease agreements for three of our hospitals in Singapore represents business continuity and operational stability for IHH Healthcare.

"The S$150 million in upgrades to our facilities will further enhance the top-notch service offerings we are known for and we look forward to collaborating closely with PLife REIT to ensure our Singapore operations remain positioned for future growth," Loh said.

IHH said the rent for the first year of the renewal term agreements is in line with prevailing market rates, and it does not foresee any material financial impact on its profitability.

The master lease agreements were entered between PLife REIT trustee HSBC Institutional Trust Services (Singapore) Ltd and IHH's indirect wholly-owned unit Parkway Hospitals Singapore Pte Ltd.

The agreements also included a "right of first refusal" to be granted by IHH to PLife REIT over the hospital block of Mount Elizabeth Novena Hospital for a period of 10 years.

Shares of IHH closed unchanged at RM5.64 today, valuing the healthcare group at RM49.51 billion.