Belgian Cofinimmo makes first foray into German healthcare

Listed Belgian real estate company Cofinimmo Group has made its first sortie into the German healthcare sector by buying a revalidation clinic located in the spa resort of Baden-Baden in southwest Germany.

Cofinimmo paid €10.91m for the asset, which it rents to the operator Celenus under a 25-year lease, and expects an initial rental yield of 7.64%. The asset itself has a surface area of 4,400 sqm and comprise 46 revalidation rooms, physiotherapy spaces, gyms, a pool and a sauna.

Celenus specialises in revalidation and psychological care and manages a total of 2,600 beds spread over 15 sites throughout Germany, so it is likely that Cofinimmo will be looking to do further deals with Celenus as operating partner.

The lease is a “double net” lease, meaning that the landlord is responsible for the repair and replacement of the boilers as well as maintaining the upkeep of the outer shell of the building (including walls, window-frames, and roof) while the tenant Celenus is responsible for al other maintenance. The rent is indexed annually at 50% of the rise in the consumer price index.

According to Jean-Edouard Carbonnelle, Cofinimmo’s CEO, “After Belgium, France and the Netherland, Cofinnimo is now extending its healthcare portfolio to Germany, where we plan to increase our presence and to partner with new operator tenants. Our strategy definitely includes diversifying our healthcare portfolio geographically.” He added that geographical diversification is intended to minimise the risks linked to possible legislative changes related to reimbursements in healthcare or the accommodation of elderly people, which could affect the operator tenants of the buildings.