Living longer: a changing population
The ageing population is one of the most significant drivers for the expansion of the healthcare sector. This older population is also one that is better educated and with more disposable income, meaning they are able to access medical services more frequently. This in turn results in an expansion of high-quality care facilities, which are able to meet the requirements and expectations of this generation. With greater numbers of buildings being created, there is an increased range of assets now available for investors.
A healthcare crisis which stretched public bodies
The Covid-19 crisis put into perspective, across Europe, the gaps in care facilities and the healthcare system itself. However, due to budget cuts made by governments across the continent, public healthcare systems are unable to bridge this gap. Private-sector involvement has now become necessary in order to ensure that care facilities can accommodate the needs of an ageing population and provide the care that is required.
Developing methodology to support investment strategies
BNP Paribas REIM has recognised the desire by investors to invest in stable assets, which are able to generate secure long-term income streams, particularly in uncertain times. This is why the scoring methodology has been created for the healthcare market, in order to highlight its advantages and provide greater transparency.
In this way, BNP Paribas REIM combined internal data related to the healthcare market with in-house views of the sector in order to identify markets within Europe with the most attractive risk/return profiles. European countries were as such split into four categories; Mature, Emerging, Suboptimal and Weak. This scoring systems allows investors to understand where value-creation opportunities can be made, and which markets would be better positioned to meet their own strategies.
In BNP Paribas REIM’s latest Living Thoughts paper, we look at the development of the healthcare system and the opportunities available to investors.