Private equity makes a significant contribution
With a volume of 331 million euros, private investors and real estate funds were the largest buyers of Dutch healthcare real estate in 2024. They invested 200 million euros more than in 2023. Institutional investors invested 190 million euros. Their share in the total volume thus fell from 60% in 2023 to 26% in 2024. This group generally provides a significant boost to the share of new construction investments in the healthcare real estate market. International investors were cautious on the buying side. It is striking that various international listed real estate funds were mainly visible as sellers of healthcare real estate with 36% of the total transaction volume. These transactions came from Aedifica, Cofinimmo, Korian and Emeis, among others.
Share of private residential care and primary care continues to increase
In 2024, for the second year in a row, investments were mainly made in the private residential care segment. An important share in this segment is the portfolio transaction in which Bouwinvest purchased 11 complexes from Wonen bij September (Emeis). The acquisition of the new-build development Thagaste (66 units) by Bouwinvest demonstrated that larger volumes at asset level in private residential care offer opportunities for the market. This development by healthcare real estate developer Gaudium Real Estate is leased for the long term by healthcare organisation Kloek. The number of investments in primary care complexes doubled in 2024 compared to 2023. 106 million euros were invested in this segment. More and more private and public parties are seeking cooperation. The sale of five large locations from Pro Senectute to Schroders Capital is a leading example of this. This involved a portfolio of 430 existing senior homes.
Investments in new-build are declining
In 2024, 270 million euros were invested in new-build senior housing. The share of new-build in the transaction volume therefore declined from 69% in 2023 to 37% in 2024. The investments in 2024 will account for approximately 1,000 new units. Compared to the 1,700 units invested in in 2023, this represents a decrease of approximately 40%. The investments are far from sufficient to meet the annual national ambition in the Netherlands of 35,000 additional senior housing units, as formulated by the government in 2022. This will further increase the pressure on the shortages in this segment. The outlook for 2025 is not more promising. Research by Capital Value shows that only 5% of developers’ new construction plans for 2025 concern senior housing or healthcare real estate.
Simplifying the development of senior housing
A possible explanation for the lack of new supply is that developers are reluctant to develop senior and care real estate. They have less experience in developing this specific type of housing. However, a home that is realised to be suitable for care only requires a few adjustments compared to a regular home based on the current building regulations. With minor adjustments, these homes can be made suitable for future care needs. This is important, as demand will change in the future because of the ageing population. In 2030, more than two million people in the Netherlands will be aged 75 and over. The current stock does not match the demand for suitable housing for this target group. To expand the stock, incentive measures from the government are also needed, for example in the form of subsidies for the realisation of new senior housing and facilitating more knowledge in this area.
Improving and deploying existing stock offers opportunities
Not only are investments in expanding the stock currently insufficient, but investments in modernising and making the existing stock of healthcare real estate more sustainable are also urgently needed. An earlier analysis by Capital Value of the Dutch healthcare real estate stock shows that 58% of the total stock of healthcare real estate dates from before 1995. More than six million square metres have an energy label E or lower. Investments in improving the quality, but also functional adjustments, are urgently needed. Such investments can provide an important boost to the stock of suitable senior housing, especially now that new-build production is insufficient to meet the increasing demand.
Manon Kuipers, director of healthcare real estate at Capital Value: “A lot more capital needs to become available for this asset class in the coming years to meet the enormous demand. We therefore call on investors to investigate further how they can include senior housing and healthcare real estate in their (impact) strategy. Especially given the urgency in this segment and the positive social effects. Efficiency can also be achieved by focusing more on the use of the existing stock and making outdated (care) homes future-proof.”
