In the second quarter of this year, the investment market for healthcare properties reached a transaction volume of EUR 690 million. Although this figure could not match the high dynamism of the first quarter, it represents a significantly better result compared to the previous year, when EUR 460 million was recorded. The cumulative transaction volume for the first half of the year thus amounts to EUR 1.8 billion, which already exceeds last year's total turnover of EUR 1.4 billion.
In the second quarter, 33 properties were traded in 14 transactions. For the entire first half of the year, this totals 145 properties traded across 35 transactions. The first quarter was largely characterised by two significant portfolio deals, each involving foreign participation. Among these transactions, US investor TPG acquired a portfolio of 31 medical centres and polyclinics from Canadian REIT Northwest Healthcare Properties, with 19 of these properties located in Germany. Additionally, Aedifica secured a share in a nursing home portfolio comprising 58 properties in Germany by acquiring 80 per cent of the shares in Cofinimmo.
Peter Tölzel, Senior Director Healthcare Investment at JLL Germany, states that foreign investors often provide a noticeable revitalisation of the market, especially during quieter market phases. He noted that German capital tends to be more hesitant when it comes to being among the first to re-enter certain asset classes. International investors, however, demand corresponding yields, which they preferentially find in the value-add segment or by acquiring core-plus properties at value-add prices. As a result of these major transactions with international involvement, the proportion of foreign buyers in the first half of the year rose to approximately 83 per cent. This figure is significantly above the usual quota, which typically varies between 40 and 60 per cent.
When considering the sub-asset classes, nursing homes dominate with a 58 per cent share of the total turnover. Clinics follow with 26 per cent, while medical centres and polyclinics together account for 16 per cent. Despite strong investor interest in medical centres, it is expected that these will not generate significantly additional revenue in the short term due to the comparatively low transaction volumes.
Nursing homes are still frequently put up for sale, sometimes in combination with assisted living. Here, object-specific quality characteristics are evident across the board, from core products to value-add properties with adjusted pricing, as Tölzel noted. However, investors continue to act very cautiously in this segment. The care sector is scrutinised most critically by capital. Although there is demand, particular attention is paid to the quality and creditworthiness of operators as well as the performance of individual properties. The current market phase is also reflected in pricing. Prime yields for nursing homes remain stable at around five per cent. For assisted living, these are approximately 50 basis points lower.
