Changing legislation creates opportunities in healthcare

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Changing legislation creates opportunities in healthcare

Dutch Real Estate Predictions 2016

The demand for real estate investments in the healthcare sector increased tremendously in the last few years. We believe that investors will raise their stakes in the Dutch healthcare sector in 2016. The focus is expected to be on properties currently used for heavy hospital care with redevelopment potential. Also properties with a long lease term, a good debtor and on a prime location, as well as upcoming new private residential care initiatives are on the target list of investors.

February 18, 2016

Financial seperation of housing and care

In 2013 the Dutch government introduced the financial separation of housing and care (in Dutch: Scheiding van wonen en zorg) which obliges elderly in a less need of care to contribute to the costs of housing in a senior care facility. Currently, the government subsides almost 800,000 elderly with approximately EUR 10.0bn a year. We expect this will decrease to 200,000 elderly with approximately EUR 2.5bn a year. Due to the budget separation and higher private contribution for the majority of elderly, more and more remain living at home or choose for new residential care initiatives in the private segment. 

In the current market, vacancy will lead to financial pressure for nursing home owners. Due to this development many of them will try to sell their vacant nursing facilities. For the marketable objects we see a huge market since great appetite is shown from investors in redeveloping these location in private residential care initiatives the last years. We expect this appetite will be even stronger in 2016. Meanwhile, the obsolete nursing homes will stay vacant or will be demolished and redeveloped.

Increase in demand for adapted homes

Furthermore, due to the separation of housing and care, housing associations need to deal with ageing of their tenants. This will lead to other needs then currently is standard for most of the housing associations. We foresee a large increase in demand for adapted homes. Housing associations will play an important role in the supply of these types of accommodation. We expect that the housing associations will invest in adapting their apartments to the needs of the elderly. 

Another change in regulations requires housing associations to yearly appraise their real estate for balance sheet purposes on market value, instead of the going-concern value. The great advantage we foresee is that is that the values on the balance sheet will represent a realistic vision on the value of the real estate. This will lead to a more professional and transparent practice for nursing homes owned by housing associations and will definitely help to accelerate the number of transformations and transactions in this market segment.
 

Read more

Waar verdwijnen verzorgingshuis­plekken voor lichte zorg en welke kansen zijn er voor transformatie van het leegstaande zorgvastgoed? (Zorg resultaten 2015 - State of the State)

Transformatie leegstaande kantoren volwaardig alternatief nieuwbouw? (Woningmarkt resultaten 2015 - State of the State)

Dutch Real Estate Predictions 2016

  1. Big data in real estate: too big to ignore
  2. Omni-channel: transforming the retail landscape
  3. Asian investors raise their stakes in Dutch real estate
  4. Construction: significant rise of new residential project
  5. Logistics: technology is redefining the retail supply chain
  6. Changing legislation creates opportunities in healthcare
  7. Real estate steps up as a key tool in the battle for talent
  8. Blockchain: the next game changer in real estate?
     

More information?

Want to know more about Deloitte Real Estate or the Dutch Real Estate Predictions 2016? Please visit our Real Estate website or contact Wilfrid Donkers via WDonkers@deloitte.nl or +31 (0)88 288 1890.

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