Spain Will Exceed 400000 Mark1199 In Nursing Homes For Elderly In 2024

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Spain Will Exceed 400000 Mark1199 In Nursing Homes For Elderly In 2024. Spain will reach 407,000 places in residences for the elderly in 2024 and will exceed 5,600 residences , which would mean a growth of more than 25,000 places and 100 residences in three years. This is clear from a report prepared by the real estate consultancy JLL that also estimates this year 60 new centers and 7,800 parking spaces will be added to the current stock.

Although it is a sector that, logically, has suffered from the pandemic ( the volume of investment in the health sector fell by 37% ), from the consultancy they predict that it will reach 600 million euros in 2021.

On the other hand, the study indicates that in 2035 there will be 12.8 million people over the age of 65, which implies a growth of this segment of the population of 38% compared to 2020 (9.3 million older people 64 years), also increasing life expectancy by three years, to 87. These data, according to JLL, predict an increase in the demand for these services by users.

Another piece of data that supports this prediction is that the coverage rate (the number of places in the market divided by the population over 64 years of age) in the Spanish market stands at 4.15, one of the lowest in Europe. This, according to JLL, supposes a supply deficit of 113,000 places, with forecasts of exceeding 134,000 places in 2025 .

The coverage ratio is especially low in the Canary Islands, Andalusia or the Valencian Community , communities that are below the national average, so they would need, approximately, an investment of 77,000 beds in total to meet the demand.

Very high profitability
On the other hand, from JLL they have announced that the ‘prime’ profitability in residences for the elderly in Spain stands at 4.75% in the second quarter of 2021, with a decrease of 25 basis points in the annual comparison. From JLL they have announced that this profitability “continues to be high compared to other European countries and real estate sectors”.

In addition, they have highlighted that among the most notable operations in recent months, the purchase of Colisee , one of the largest European operators, by the investment fund EQT stands out.

“The economic and operational impact of the pandemic on some operators has been high, so we do not rule out a significant increase in operations, either through the sale of properties or companies holding them,” said the director of Living de JLL, Juan Manuel Pardo, who has clarified that the sector “does not only have an obvious short-term appeal, but that the demographic evolution in the coming years, the solvency of the main operators and the stability in returns , make each there are more investors looking to increase their exposure to it. “

Pardo also pointed out that the sector is on a path of investment projects in development projects from the acquisition of endowment land. In this sense, the market is evolving towards the union of specialized promoters-builders and investors with operators , who structure “more and more” operations from the purchase of land and contracts between promoter and investor.

The residence, private and small in size
Of the 5,500 residences in Spain, 60% are privately owned and managed. In addition, the current stock is mainly made up of small and medium-sized residences, with centers with more than 100 beds representing only 23% of the total. Spain Will Exceed 400000 Mark1199 In Nursing Homes For Elderly In 2024

However, the interest of the large operators and specialized investors is the construction of residences with more than 100 beds , a size from which sufficient economies of scale are achieved, as well as the hiring of common full-time services to have a more attractive offer for tenants.

Another growing trend in Spain are the so-called ‘retirement living’, a very popular model in the United States that consists of a housing complex or residential community designed for non-dependent older adults , which allow the socialization of their tenants and in which They promote specific activities for them with the option of home care if they require it.

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