The demand for housing for senior citizens and for healthcare-related property is only going to increase. By investing in this specific sector, we are creating both stable financial returns and having a social impact. This is part of working towards Real value for life.
As the population ages, there is a growing shortage of suitable housing for the elderly who need some form of care. Since the beginning of the 1990s, the number of senior citizens in the Netherland has increased, and the group of people born during the baby boom years of the 1950s, 60s and 70s are starting to reach pension age. At the same time, average life expectancy is rising, increasing from 79.5 in 1990 to a forecast 85.5 by 2040. The dual impact of demographic change and increased life expectancy will increase the number of households of pension age in the Netherlands to 1.1 million by 2040.
The markets are currently volatile and interest rates are low, but pension funds still want to increase their assets. They are ready to invest in housing for senior citizens and in care-related property because of both the stable financial returns they generate, and the social impact. There is enough capital to invest, but often a shortage of product to invest in.
The enormous demand for care-related housing presents a challenge to care institutions, the real estate sector and local authorities. Local authorities in particular have a key role and it is important that more develop policy and set concrete targets. This has already happened in Rotterdam, where city officials and developers have drawn up a covenant to cover care-related housing.
We believe local authorities should place greater emphasis on facilitating development, such as by making sure former school buildings, nursing homes, swimming pools and local authority offices retain a public function. This will prevent properties from being snapped up by the highest bidder. Three-quarters of our investments are located on land allocated for projects to benefit society at large.
“Bouwinvest plans to grow strongly in this market. Our investments will reach €600 million by 2022 and top €1 billion in the five years after that”Erwin Drenth Director Dutch Healthcare Investments
The De Gijsbrecht sheltered housing complex in Ouderkerk aan de Amstel near Amsterdam is made up of 62 sheltered housing units. The homes are affordable and the over-75s have priority. Efforts are made to encourage residents to live independently for as long as possible and there is a hostess service that provides support and personal attention several times per week. The hostess system also stimulates contact between the residents and provides a link to the nearby nursing home, Zonnehuis Theresia, which people in the sheltered units are welcome to visit.