REFIRE recently took part in a discussion with a number of leading healthcare real estate professionals, hosted by Berlin-headquartered communications agency RUECKERCONSULT. The focus was on health centres, doctor centres and medical care centres (MVZs), a sub-sector of the overall healthcare real estate sector.
Several assets managed and owned by the panellists were examined in detail. Most speakers confirmed that yields for prime assets in the sector of between 3.75% and 4.75% were still achievable. Investment is needed to meet the high demand for properties, as well as the threat of medical undersupply.
Particularly in rural areas, where inpatient care is declining, there is a need for more co-operative and outpatient facilities such as health centres, doctor centres and medical care centres (MVZs), as a consequence of recent German health reforms which seek to promote home care rather than in-patient treatment in hospitals.
Jochen Zeeh, CEO of [[ImmoTISS Care]], a specialist advisor and service provider for healthcare real estate, was optimistic about the long term. "Some investors have reservations about operator properties due to the temporary developments and challenges for care companies, although the risks - despite the current insolvencies - are offset by significant opportunities due to the sustainably secured demand resulting from demographic trends and the existing significant undersupply. Organically growing operators with a coherent conceptual mix will benefit from this growth market in the long term", he said.
On yields, he indicated that, "Dominated by limited supply, long-term lease structures and high demand, prime yields in the first quarter of 2023 were 4.5% for nursing homes, 3.8% to 4% in the assisted living segment for seniors, and 4.25% to 4.75% for medical centers and MVZs.
Sawas Koutsidis is managing director of the MEDZENTRUM Network, part of the Giessen-based IWG Group which develops and manages medical and health centres under the MEDZENTRUM brand. Koutsidis addressed fears that outpatient medical care is in danger of collapsing. Hence the need for more co-operative approaches, such as housing many medical professionals under one roof, enabling them to lower the costs and risks or running their own individual locations.
"The trend toward cooperation and specialization in medical and therapeutic services offers many advantages. For example, costs for technical equipment can be better shared, and the demands of medical professionals in terms of a work-life balance and less risk-taking can also be met by running their own practice," he said.
Michael Eisenmann is the CEO of Real Blue KVG, a fund manager focused on so-called Impact Investments in the care home sector. Its latest open-ended Spezialfonds is an Article-9 fund is targeting partial and full in-patient assets, as well as health centres and MTVs. The fund is working on the premise that by 2040, the investment requirement for nursing homes will be around €109 billion, and €154 billion for assisted living.
"The future demand for forms of accommodation for the elderly, as well as care and nursing services, exceeds supply many times over. As a result, there will be an undersupply in 95% of German municipalities. Legislators are therefore increasingly focusing on outpatient and innovative forms of accommodation, care and nursing, since comprehensive care can no longer be provided with inpatient facilities alone", said Eisenmann.
The Real Blue fund, with an equity volume of €150m, plans to invest in individual properties with a unit investment volume of €30 million euros as well as in portfolios of up to €50 million. New-build projects are favoured, as well as existing urban properties with high ESG ratings.
