Healthcare properties remain a key focus for institutional investors, family offices, and project developers. In 2025, capital availability is expected to be highest for the segments of assisted living and medical centres / MVZ (multispecialty medical centres). These are the findings of the “Investor Survey Healthcare Properties 2024” by Cushman & Wakefield.
A total of 105 participants from the German healthcare property market took part in the survey. Asset and investment managers make up the majority of respondents at 51 per cent, followed by project developers at just under 20 per cent. Jan-Bastian Knod, Head of Residential Investment Germany and Head of Healthcare Advisory at Cushman & Wakefield, comments: “The asset class of healthcare properties remains an attractive and future-proof investment opportunity despite the current challenges. Investors who are prepared to adapt themselves to the long-term trends and specific risks of this segment can benefit from the opportunities that will present arise as early as 2025.”
A-cities are increasingly becoming the focus of investment – Assisted living remains the favourite for investors and financiers
The analysis of the survey results by property type and location category shows a diversification of investment strategies within the asset class. Assisted living is the most frequently mentioned property type, with nursing homes and medical centres / multispecialty medical centres (MVZ) close behind. This reveals differences in the assessment of the individual property types in relation to their location. The geographic focus of the respondents is increasingly shifting towards larger, economically strong cities. Whereas in the previous year, investors were interested in nursing homes in C-cities to the extent of 55 per cent and in D-cities to 40 per cent, these values for 2024/2025 are only 48 and 31 per cent respectively. The Cushman & Wakefield survey shows similar shifts for the other property types, which the authors see as evidence that investors have become more selective in their choice of regions and cities and are seeking more security in economically strong and socio-demographically growing cities.
The respondents anticipate the highest capital availability in the next twelve months within the assisted living segment: 64 per cent rate it as “high” or "medium," followed by medical centres / MVZ with 58 per cent indicating high or medium availability. 46 per cent see low capital availability for nursing homes, while 19 per cent expect no availability at all in the next twelve months, considering the turbulence in the market for operators of inpatient care facilities.
Declining returns expected for clinics and medical centres / MVZ
Investors have different views on the development of prime yields in the individual segments. According to their assessment, prime yields for (rehabilitation) clinics and medical centres / MVZ are expected to decrease. As of the beginning of 2024, these stand at 5.75 per cent and 4.75 per cent respectively. In the nursing homes segment, currently at 5.1 per cent, there is an expectation of a slight increase in the prime yields over the next twelve months.
Investment strategy remains expansive for the majority of investors – opportunities for developers will rise
The majority of the asset and investment managers, private equity investors, family offices / private individuals, insurance companies and pension funds as well as listed companies / REITs surveyed are pursuing an expansive investment strategy for the healthcare property asset class /Health Care 2025. Jan-Bastian Knod stated: “These investors are taking advantage of the market situation to invest in promising projects. To create liquidity, listed companies / REITs, in particular, acted as sellers in 2024. At the same time, they are also benefiting from the thawing of the debt capital market.”
The assessment of the investment strategy among private equity investors and project developers is more reserved. Given the limited development pipeline and the continued high interest—around 60 per cent—of respondents in investments in project developments or acquisitions as part of a forward structure, Cushman & Wakefield remains optimistic about the about the healthcare real estate investment market. Jan-Bastian Knod concluded: “Even today, there is already a noticeable excess demand for healthcare services. Only in the medium term do respondents expect an increase in construction activity. In the long term, we see significant potential in the development of sustainable healthcare real estate with innovative concepts. Investments in modern, energy-efficient facilities and the integration of digital healthcare solutions could offer decisive competitive advantages.”
Download the complete survey here.
