Healthcare real estate is a safe investment that is independent of economic fluctuations.
We are all getting older. Where will all these elderly people live? Where do the elderly of the future want to live and will the offer match that? Victor Gulickx, Fund Director of Hartelt Fund Management BV, gives his opinion in the second part of the triptych about healthcare real estate from Vastgoedmarkt.
The first part of the trilogy shows that the elderly and care organizations have a great need, in particular, for more life-long housing for seniors. Such a life-long home is a small home that can easily be adapted to an increasing demand for care and falls in a gray area between homes and healthcare real estate. The investor Apollo Zorgvastgoedfonds, who specializes in healthcare real estate, is keeping an eye at the development in the field of healthcare real estate.
Less economically dependent
Victor Gulickx, fund director at the Apollo Zorgvastgoedfonds: ‘Our investment policy is that there must be a care component in real estate. When we started this in 2013, we saw that the market was changing and that there was a shortage of this type of real estate. The real estate segment is maturing as it is a safe investment independent of economic fluctuations.
Life-time-resistant homes therefore do not fit into Apollo’s portfolio. ‘It is a bit too free for us, those homes are for vital elderly people and that is not real health care.’ The fund invests exclusively in assisted living, nursing homes and care & treatment centres.
An assisted living location is for people with a starting to advanced health care need, but who can and want to live independently. ‘In these complexes, people have a fully-fledged apartment, but they maintain the connection with other residents. There is a major shortage of this due to the government’s incentive to let people live at home for longer’, says Gulickx. In 2010, people stayed in a nursing home for an average of three years, nowadays they stey between eight and twelve months. Because people continue to live at home longer, they need health care within their reach. That is why Apollo also invests in local health centers.
Nursing homes are important investment objects for Apollo. At Apollo, the focus is on large-scale health care properties, but with a pleasant, homely appearance. “The staff shortage in healthcare is increasing and we are becoming increasingly dependent on informal carers and volunteers. We have noticed that if a nursing home looks pleasant and homely, there will be more volunteers and carers. By applying small-scale within large-scale complexes, the healthcare provider can divide its available care very efficiently,’ says Gulickx. Scheijgrond adds: “Individualism is increasing, the social network is becoming less and more volatile, and people have fewer children. That is why we have to ensure that the scarce healthcare personnel available are used as well as possible.”
Gulickx does not intend to include life-long homes in the portfolio in the long term. “That is a task for the regular home investor, we will probably focus even further in the future on specialist care, such as specialist hospitals.”