萊坊：2023年醫療保健資本市場報告（英文版）（15頁）.pdf

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1、Healthcare Capital Markets economic uncertainty,the UK healthcare sector remains buoyant and the overall outlook is positiveHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 202323For the second year in a row,the healthcare sector has experienced a fundamental shift in the attitudes of priva

2、te investors.In the 2023 edition of The Wealth Report,healthcare topped investors wish lists for a second year in a row.Our Attitudes Survey highlighted that just over a third of respondents globally were looking to invest in healthcare-related assets in 2023.Figure 1 presents a compelling view of t

3、he growing recognition of healthcare as a leading sector within real estate.As illustrated,there has been a substantial rise in private capital allocated to the sector,and the 24%share in 2021 grew to approximately 33%in 2022.This comes at a time when we have seen the percentage of capital allocated

4、 to more conventional classes,such as offices,dip.While this may simply be an indicator of diversification,we are ultimately experiencing a shifting of sentiment towards defensive sectors as investors seek certainty and consistency.2022 SUMMARY3.50%Average annualised returns72%Portfolio transactions

5、2.17bnFive-year average transaction volume 2.4bnTotal transaction volumeContinued private investor sector focusLong-term incomeWeighted average unexpired lease terms(WAULT)average 25 to 30 years in the residential care and hospital sectors.Leases are commonly index linked to inflation.The case for h

6、ealthcare as an investmentDemographic shiftThe UKs over-85 population is set to increase from 1.7 million to 3.7 million in 2050.This ageing population will result in increasing demand for residential care,primary care and acute hospital services.Secure incomeOperator revenue is reinforced by a heal

7、thy mix of self-and publicly-funded care.Income is supported by high occupancy and patient demand across the healthcare arena.Investment performanceTotal returns measured 3.5%in 2022,higher than many core property sectors.Returns are historically stable,offering investors protection and diversificat

8、ion.Structural change in real estateReal estate investors are already de-risking from traditional sectors such as retail into alternatives including healthcare.Demand for safe havensBroader UK real estate offers security and liquidity in a global downturn.The UK healthcare sectors long-term and ofte

9、n government-supported income offers further defence.Social impactThe influence of ESG investing in real estate is growing at a faster pace than ever.A range of investors are now focusing on social infrastructure investments,with healthcare part of this.Fig 1:Which sectors do your clients currently

10、invest in?%respondents 202120220%10%20%30%40%50%OfficesHotels and leisureRetailLogisticsIndustrialDevelopment landResidential private rented sector(PRS)Student housingHealthcareAgriculturalRetirementData centresLife sciencesEducationOther(please specify)20212022Source:Knight FrankSource:Property Dat

11、a,MSCI.*As at end of Q4 22 31%Percentage of demand from overseas capital This years report focuses on the healthcare investment market in 2022,looking at emerging trends from both an operational and real estate perspective,as well as our insights for the year ahead.IntroductionRYAN RICHARDS,SENIOR A

12、NALYST200mLargest single asset transaction UK healthcare markets have remained robust and continue to draw the attention of both domestic and global capital.As with previous years,the fundamental drivers demographics,long-term income and ESG credentials have played a key role in pushing the case for

13、 healthcare.With 2022 a year of headwinds in the form of inflation,rising interest rates and political uncertainty,we saw significant transaction volumes closing at circa 2.4bn.This,in line with improved operator trading,as highlighted in our Care Homes Trading Performance Review 2022,suggests a mai

14、ntained confidence in the sector.Despite the absence of major outlier deals,the trend of increased transactions slightly up on the year is testament to the healthcare sectors pulling power.Overseas capital was once again a key factor,accounting for 31%of transaction volume.This stems from a mix of b

15、oth European and North American capital continuing to find value in the sector.It is worth noting that,while it remains the largest contributor to transaction volumes,overseas capital was not as prominent in 2022,with occupiers and domestic REITs/listed investors taking back some share volume.With 2

16、022 volumes more organic than previous years,domestic capital is also showing interest.Average annualised returns sat at 3.50%at the end of Q4 22.When considered with the wider shocks felt by other commercial real estate classes over the past year,the sectors stability and return potential is even m

17、ore apparent.The overall outlook for the healthcare sector can be considered positive,and we predict an active market for care assets in 2023.That being said,due to the operational nature of the sector,it is becoming increasingly important that operators,investors,developers and lenders pay close at

18、tention to the impact the current economic environment has,or will have,on their capital.The Attitudes Survey:The 2023 instalment is based on responses provided during November 2022 by more than 500 private bankers,wealth advisors,intermediaries and family offices,who between them manage over US$2.5

19、 trillion of wealth for UHNWI clients.HEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 202345Market viewSource:Knight Frank ResearchSource:Knight Frank ResearchComposition of survey participants Source:Knight Frank ResearchElderly care81%Hospital facility 43%Adult care/supported living 29%P

20、rimary care 24%Other medical 24%Childcare19%Which areas of healthcare do you currently have exposure to?(%of respondents)Source:Knight Frank ResearchREITs&Listed 43%Institutional38%Private property company19%4,113Total care assets74bnApproximate value of care assets under the management of survey pa

21、rticipants globally14bnThe amount of capital currently available and committed for surveyed investors to deploy on care assets38%of participants are classified as overseas capital99%Average rent collection percentage for participants portfolios4.2%Average cost of debt among survey participants37%Ave

22、rage loan to value among survey participants4.63Average years remaining on term of survey participants debt facilities1.81xAverage rent cover across survey participants portfolios91.1%Average percentage of survey participants debt that is hedged24%Percentage of survey respondents that report no use

23、of debt As with last years report,given the various factors impacting the sector,it is extremely important to drill down into investor sentiment to truly understand the state of the market.While extensive resources and in-house data provide a strong overall view of the market,the first-hand investme

24、nt experience and strategies utilised by those involved provide invaluable insights.We have therefore surveyed most of the key UK market players including major REITs,institutional and overseas investors.Primary lot size sought by respondents for acquisitionsSource:Knight Frank ResearchSource:Knight

25、 Frank ResearchLess than 10m 10m-25m25m-50m75m-100mAbove 100mMost important driver of demand for UK healthcareHow far is the healthcare sector from normality,following Covid-19?Demographic shift65%Secure income15%Long-term income5%Investment performance5%Structural change in real estate10%Demand for

26、 safe-havens0%Social impact0%How would you describe the impact of current economic conditions on the performance of your portfolio of care assets?30%40%25%5%MildModerateSignificantLittle/no impact55%9%9%23%5%6-12 months 90%12-24 months5%36+months0%50m-75m0%40%7%27%13%13%Source:Knight Frank ResearchC

27、urrent WAULT of survey participants healthcare portfolios10yrs 15yrs15yrs 20yrs20yrs 25yrs25yrs 30yrsOver 30yrsHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 202367What would you suggest is a major issue with the current quality of stock?Size10%Lack of en-suite10%Lack of full wet room30%E

28、SG credentials20%Scope for repurposing5%Other25%Location0%Region most sought after by surveyed investorsRegion least sought after by surveyed investorsPercentage of survey participants current strategy attributed to development10%-30%50%-70%30%-50%Over 70%1.1bnSource:Knight Frank ResearchSource:Knig

29、ht Frank ResearchSource:Knight Frank ResearchSource:Knight Frank Research95%of survey participants have begun to implement ESG into their current strategy Type of debtSource:Knight Frank ResearchSource:Knight Frank ResearchConventional bank financeCorporate bondSustainable/green financePrivateplacem

30、ent What has been the greatest obstacle in the ability of investors to implement ESG into their strategy?Lack of ESG opportunities20%Lack of ESG understanding15%Lack of set standards/guidelines25%Difficulty in enforcing among operators25%Other15%15%45%15%20%What are your thoughts on the general pric

31、ing tone of the market?Underpriced5%Correct50%Overpriced45%Do you see demand from overseas capital for UK care assets increasing,decreasing or stabilising?Increasing57%Stabilising 38%Decreasing5%Source:Knight Frank ResearchSource:Knight Frank ResearchSource:Knight Frank ResearchHow has the current c

32、limate impacted your current appetite for risk?Elderly care67%Area of healthcare that presents the greatest investment opportunitySource:Knight Frank Research67%19%14%Childcare 0%l Primary care 0%l Other medical 0%Elderly careAdult care/supported living Hospital facilityDecreased43%No change38%Incre

33、ased19%No preference 25%London 25%West Midlands 10%South West 10%South East 25%Northern Ireland 5%56%13%13%6%No preference 30%Northern Ireland 15%Wales 10%Scotland 5%London 5%North West 5%Yorkshire and the Humber 15%South West 15%HEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 202367Source

34、:Knight Frank ResearchWhat would you suggest is the greatest cost pressure on operators at present?71%Staffing costs19%Utility costs10%Agency costsHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 202389Market volumeAs we can see in figure 2,recorded volumes for 2022 sat at 2.36bn,compared w

35、ith 2.34bn in 2021.Although only a slight upwards movement on the previous year,it is useful to note this volume lacks the outlier style of major deals that skewed transaction volumes in the past.Figure 3 compares the annual movement in healthcare volume to that of all property classes.Healthcare,wh

36、ich accounted for around 4%of all commercial property transactions,was up 1%on the year,despite a slight dip in volume experienced by all property classes.While only a minor upward trend,this can be considered positive due to 2021 volumes being down 15%on 2020 volumes,and signals a move in the right

37、 direction.This further illustrates the resilience of the healthcare sector and its lack of sensitivity to wider economic shocks,when compared with more conventional real estate classes.Figure 4 presents transaction volume on a quarterly basis,as well as rolling four quarters.One trend highlighted b

38、y this years data is the lack of spikes due to standout transactions and a resulting smoothness in volumes between quarters.Investment by sub-sector is another area to consider when discussing market volume.It is useful to understand where capital is being placed and how this differs from historic i

39、nvesting trends.Figure 5 presents the share of transaction volume attributed to each care sector in 2022,as well as the past five years.The standout factor from the chart is the continued interest in elderly care,which accounted for 61%of volume.In addition to this,adult care and private hospital sp

40、aces regained some share of volume,accounting for 35%collectively,due to notable portfolio deals.2022 was a year of promising volumes,and healthcare remained stable,despite a volume dip in other property classes.3,5003,0002,5002,0001,5001,0005000Source:Knight Frank,Property Data.Includes recorded tr

41、ansactions for elderly care,adult care and supported living,primary care,hospital facilities and childcareQ1 2013 Q3 2013 Q1 2014Q3 2014 Q1 2015 Q3 2015 Q1 2016 Q3 2016Q1 2017Q3 2017 Q1 2018Q3 2018Q1 2019Q3 2019Q1 2020Q3 2020Q1 2021Q3 2021Q1 2022Q3 2022Source:Knight Frank,Property Data3.02.52.01.51.

42、00.5020122013201420152016201720182019202020212022Fig 2:Recorded healthcare investment volumes(bn)Fig 4:Recorded healthcare property transactions(m)61%52%10%7%29%15%3%20%1%1%1%51%Last five years2022Elderly careAdult carePrimary careHospital facilitiesChildcareOther medicalFig 5:Healthcare property in

43、vestment by asset typeSource:Property Data200%150%100%50%0%-50%-100%201420152016201720182019202020212022HEALTHCARE PROPERTYALL COMMERCIAL PROPERTYFig 3:Percentage change in property investment volumesMarket volume“Healthcare,which accounted for around 4%of all commercial property transactions,was up

44、 1%on the year,despite a slight dip in volume experienced by all property classes.”“One trend highlighted by this years data is the lack of spikes due to standout transactions.”VOLUME OF DEALSVOLUME-4 QUARTER ROLLINGSource:Knight Frank ResearchHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKET

45、S 20231011Following last years analysis,figure 6 illustrates a strip out of major deals(classified as any large transactions over 500 million).Although there are few such transactions(three within the last 10 years),the inclusion or exclusion of such deals can present a different picture or sentimen

46、t.The lack of major deals within 2022s volumes should be considered positive where volumes are not skewed.This has seen volumes moving towards a more organic state,built on a number of varied transactions,as opposed to a few high-value ones.For the year ahead,we anticipate the sector will maintain i

47、ts momentum in relation to recorded transactions,particularly as the sectors volume emerges as more sustainable.Figure 7 shows forecast volumes based on an average five-year growth,excluding any major deals(above 500 million).Essentially,we anticipate this further growth in volumes will be a result

48、of a combination of the sector normalising,more organic demand and high-capital investors seeking to opportunistically deploy funds.HEALTHCARE PROPERTYMAJOR DEALS10-YEAR AVERAGESource:Property DataFig 6:Recorded healthcare property transactions(bn)201220132014201520162017201820192020202120223.02.52.

49、01.51.00.50DescriptionDeal typePrice(m)DatePurchaserTypeCategoryBMI healthcare portfolioPortfolio1,500Jan 1 2020Medical Properties TrustOverseasHospital facilitySpire HealthcarePortfolio700Jan 1 2013Malaysia Employees Provident FundOverseasHospital facilityPriory sale&leasebackPortfolio800Jan 1 2021

50、Medical Properties TrustOverseasHospital/mental health facility Table 2:Major healthcare deals(500m+)20122022Elderly careHospital facilityTotalBanks962962Overseas3,0003,000Private property company691691Total1,7622,8914,653Table 3:Major healthcare deals by investor type and sector“We anticipate the s

51、ector will maintain its momentum in relation to recorded transactions.”2.4bnin healthcare property transactions took place in 2022Deal typePrice mDateDetailsPropertiesPurchaserPurchaser TypeSectorPortfolio200Dec-22S&L45Civitas Social HousingREITS&ListedAdult care/Supported livingPortfolio78.5Jun-22C

52、are homes across Somerset and Devon3Impact Healthcare REITReits&ListedElderly carePortfolio70.2Feb-22Five care homes in East Anglia with a sixth asset located in Dorset6PGIM Real EstateInstitutionalElderly careSingle asset58Apr-22Undisclosed1Assura PCP UK LtdREITS&ListedPrimary carePortfolio51.25Sep

53、-22Yorkshire care homes2Anchor Housing GroupOccupierElderly carePortfolio45.5Sep-22Three care homes:198 beds in total3Aedifica NV/SA(Belgium)OverseasElderly careSingle asset31Apr-22Undisclosed1Primary Health PropertiesREITS&ListedPrimary careSingle asset8.5Jul-22Undisclosed1Middle Eastern investorOv

54、erseasElderly careTable 1:Notable deals in 2022Fig 7:Anticipated transaction volumesSource:Knight Frank Research,Property Data05001,0001,5002,0002,5002023(Predicted volume)20222021202020192018201720162015201420122013Source:Knight Frank Research,Property DataSource:Knight Frank Research,Property Data

55、Source:Knight Frank Research,Property DataHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 20231213Transaction composition With significant volume recorded,we now look to transaction composition.This is vital to understanding the sectors direction in terms of capital flows,investor type,tar

56、get areas and much more.Figure 8 illustrates that in 2022,portfolio deals accounted for 72%of transactions,in comparison to single assets at 28%.This is an increase of 500 bps on last years figure,owing to transacting REITs and overseas capital,in their continued pursuit to grow assets under managem

57、ent.Single asset transactions will no doubt remain prevalent,especially in the private hospital sector,where we have seen notable large acquisitions.From figure 9,we can see how transactions by overseas investors in 2022 compares with the five-year total,whereby over time,overseas capital has become

58、 more prominent.However,2022 also experienced a dip in the share of transaction volume attributed to overseas capital.This is not owing to a lack of overseas demand,but more increased domestic demand eating into the overseas share,as REITs and private capital demonstrate more interest in the sector.

59、Figure 10 provides an insight into the target market areas from overseas capital over the last two decades.This analysis focuses on the location of capital and the sub-sector of healthcare that it flows into.We can see that US-based capital has historically been split between elderly care and privat

60、e hospital assets,whereas European-based capital has been more elderly care-focused.We are also witnessing an interest in specialist and childcare facilities.However,these are less prominent within the analysis due to less maturity in the space,in comparison to elderly care and hospital facilities.F

61、igure 11 provides an insight into the source of overseas capital in 2022.As in previous years,capital from the US is a large component of transaction volume;a trend not only seen in care but also within all broader property capital flows.However,healthcare seems to have a more even split between Eur

62、opean and US capital,which is responsible for 39%and 32%of overseas flows respectively.“In 2022,portfolio deals accounted for 72%of transactions in comparison to single assets at 28%.”Source:Property DataFig 9:Overseas share of healthcare property investment2022Overseas 51%Domestic 49%2018-20222022

63、Healthcare vs all propertyOverseas 44%Domestic 56%Overseas 51%Domestic 49%2022 All propertyOverseas 31%Domestic 69%2022 HealthcareSINGLE ASSETPORTFOLIO0%10%20%30%40%50%60%70%80%90%100%Fig 8:Portfolio vs single asset transactions71%81%74%2022 2021 20202019 2018201772%28%33%15%26%19%29%67%85%74%81%71%

64、Fig 10:Cross Boarder CompositionFig 11:Cross-border composition0%10%20%30%40%50%60%70%80%90%100%EUTHE AMERICASMIDDLE EASTFAR EASTOTHERS/UNDISCLOSEDAll cross-border property compositionCross-border healthcare compositionKuwaitMalaysiaBahrainFranceDenmarkChinaIsraelBelgiumCanadaUndisclosedUnited State

65、sMiddle East*Primary careElderly careHospitalfacilityFig 10:Placement of overseas capital into UK healthcareSource:Knight Frank Research,Property Data Source:Knight Frank Research,Real Capital AnalyticsSource:Knight Frank Research,Property Data*undisclosedHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CA

66、PITAL MARKETS 20231415Fig 12:Healthcare property investment by buyer type 70%60%50%40%30%20%10%0%80%REITs&ListedInstitutionalPrivate property companyOccupierOverseasUndisclosedPrivate investorSource:Knight Frank Research20182019202020212022The trend that instantly emerges from figure 12 is the exten

67、t to which REIT and general domestic demand has eaten into the share of transactions attributed to overseas capital,showing 9%growth in comparison with the previous year.Healthcare as a sector remains diverse in its own right.From elderly care to private hospitals,investor capital has the benefit of

68、 options.Figure 14 shows which target areas have changed and which remained consistent for each investor type over the past few years.While elderly care has emerged as a target area for domestic demand,there has always been a substantial interest in private hospitals from overseas capital.This year,

69、however,has also seen the adult and specialist care space gain more,due to interest from REIT investors.Figure 13 presents net acquisitions and disposals over the past few years by investor type.Despite occupiers being more active,there is still a trend for occupiers to present themselves as net sel

70、lers,once again supporting the narrative of exiting longer-standing,family-owned operators.This also highlights a growing trend for sale and leaseback transactions between operators and investors as a capital release strategy,as debt terms become less favourable.Fig 14:Sector investment by investor

71、type 2019-2022Institutional OverseasPrivate property companyOccupierPrivate investorREITS&ListedSource:Knight Frank ResearchAnother active force in healthcare is the merger and acquisition space,with the sale of many operational businesses.Interestingly,it is not only operators that have been active

72、ly transacting on this side.Over the years,we have seen interest from the likes of infrastructure funds,as well as sovereign wealth-backed capital.An example of such a deal is Mubadala Capitals investment in Witherslack Group.Where we have also previously seen equity-led capital,with a presence acro

73、ss operations(such as private equity house Waterland with the Priory Group),we are now seeing a diverse interest base.Such interest is in the form of institutions and even REITs who have,and continue to formulate,strategic relationships and joint ventures with operators.This not only presents a stro

74、ng value-add opportunity,it also highlights the fundamental importance of the landlord and tenant partnership in driving healthcares performance.On assessment of such deals from 2020 to 2023,this blend of investor types aids the notion that there is appetite for the sector from numerous angles;be it

75、 Reuben Brothers interest in Avery Healthcare,or the joint venture between Aedifica and Emera on the LV Care Group.From a sample set of deals over this period of time,disclosed multiples suggest an average revenue multiple and an average EBITDA multiple of 4.6x and 10.8x,respectively.Operational dea

76、ls and the changing face of capital Commentary*Source:Merger market-averages taken from reported deals within sample that disclosed multiples.4.6X 10.8X*Average revenue multiple*Average EBITDA multiple HENRY ELPHICK,DEPUTY CHAIR,EUROPEAN HEALTH CARE PRIVATE EQUITY ASSOCIATION Healthcare remains a co

77、re sector for investors and returns have remained strong through cycles.The sector is not immune to the higher cost of debt,or to the impact of higher inflation and staffing cost pressures,but the underlying demand for healthcare,diagnostics and therapy remains.Perhaps the biggest changes have been

78、the entry of strategic buyers interested in social infrastructure and sovereign wealth funds and family offices looking for exposure to healthcare more broadly.Often with a lower cost of capital,this has led private equity investors to look for value in sectors that are less asset-or people-intensiv

79、e,such as capex-light clinic models,tech-enabled business models,diagnostics and pharma services and manufacturing,often partnering with real estate investors.Adult care/Supported livingChildcareElderly careHospital facilityPrimary care2021202020192022Fig 13:Net acquisitions or disposals by investor

80、 typeREITS&listedOverseasInstitutional Private property companyOccupierUndisclosed2017201820192020202120222,0001,5001,0005000-500-1,000-1,500-2,0002,500Private investorBanksSource:Knight Frank Research,Property DataHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 20231617Jorge Manrique Char

81、ro Vice President,Investments:WelltowerQ:The Welltower portfolio is spread across several geographic regions.How would you describe the UK healthcare sector in comparison to alternative global markets?We benefit from having large portfolios in three major markets(US,Canada and UK).Two key difference

82、s between these markets are first a new net supply of senior housing(as a percentage of existing stock)that is consistently lower in the UK than in the US.Second,the percentage of beds managed by the top 20 operators is much lower in the UK than in the US and Canada.Q:What is your current strategic

83、focus,and has this changed significantly from this time last year?Or even pre-pandemic?We believe the biggest opportunities are in addressing the need for purpose-built accommodation and improving the performance of existing assets through active asset management.For that reason,our focus is the bac

84、king of a small number of high-performing operators to grow their businesses through developments and acquisitions.Q:How would you say your capital structure,e.g.equity vs debt,aids the ability to support your strategy during the current climate?Welltower has a prudent capital structure strategy,as

85、illustrated by the lower-leverage level compared to our peers.Our capital markets team does a great job in publishing regular business Jorge Manrique Charro is Vice President,Investments at Welltower Inc.and leads the firms London office.He previously worked at Sidewalk Labs,the Abu Dhabi Investment

86、 Authority and Tishman Speyer.Welltower(NYSE:WELL US$45bn enterprise value)is the largest owner of healthcare real estate globally,with a portfolio of nearly 2,000 properties focused primarily on the private pay seniors housing space.updates,and that transparency is key to inspiring trust with our i

87、nvestors.As a result of this strategy of prudence,transparency and disciplined capital allocation,we currently have$5bn of available liquidity.We would like to increase our presence in the UK,and we are very well capitalised to fund the growth of our existing platforms and to seize new opportunities

88、.Q:With regards to strategic partnerships such as Welltowers joint venture with the Reuben Brothers(and their recent acquisition of Avery Healthcare),what are the key elements of such partnerships that prove fundamental in scaling quality care provision?Reuben Brothers have an outstanding track reco

89、rd of building fantastic businesses(such as Global Switch).In addition to their deep understanding of real estate,they have a commitment to creating best-in-class platforms and recruit the best people to build the business.Lorna Rose recently joined Avery Healthcare as CEO and this is just the start

90、 of an exciting journey that will lead to growth in the number of homes,but more importantly to further improvements in processes,people and quality outcomes.Q:How would you describe current market pricing?Currently,the pricing expectations for many sellers are anchored on the future stabilised perf

91、ormance of homes that are in lease up or recovery phase.Based on those projections,underwritten returns look historically attractive.Some of those business plans will be achieved and some wont there are big opportunities for those who can find the right combination of portfolio and operator to deliv

92、er improvements in trading performance.Q:What are your thoughts and predictions for the future of the sector?Over the next 10 years,I believe the industry will create the right processes to safely collect and analyse data about buildings and how they are experienced by their residents.Excellent oper

93、ators will create solutions to improve building designs,enhance sustainability and achieve improved health outcomes.The ability to have a positive impact on society is what makes it such an exciting opportunity.Investment performanceAs well as strong transaction volume in 2022,healthcare assets have

94、 also shown a robustness in holding returns and performance for the year.Overall,returns and the general performance of the sector continue to justify the fundamental drivers associated with healthcare.Whether long-term income capabilities or demographic-led demand,the sector certainly remains attra

95、ctive to investors.Figure 15 presents a view of yields for the various sub-sectors within healthcare.Figure 16 highlights total returns across several sectors at the end of 2021.Although there are several other sectors demonstrating higher returns than healthcares 3.5%annualised average return,it is

96、 important to note that while healthcare sits below its long-term average,there have been some more significant variances among other sectors.Fig 16:Total returns(%)4035302520151050510152021202210-YEAR AVERAGEHealthcareEducation*HotelResidential(PRS)IndustrialOfficeRetailSource:Knight Frank Research

97、,MSCI“Over the next 10 years,I believe the industry will create the right processes to safely collect and analyse data about the buildings and how they are experienced by the residents.”ELDERLY CAREPRIMEPRIME(SPV)SECONDARYTERTIARYPRIMARY CAREPRIVATEHOSPITALSCHILDCARE(NURSERIES)ADULT SUPPORTED LIVING

98、4.25-4.55.57-7.55.5-65.75-6.57+4.5-54.54.25-4.55.5-6Fig 15:Healthcare yields by sub sectorSource:Knight Frank Research,MSCIHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 20231819Off the back of consistency of returns presented in figure 16,figure 17 takes this a step further by providing

99、an insight into the risk/return relationship of these sectors.Healthcare emerges as presenting a lower risk level,due to its lack of variance.Because conventional healthcare leases benefit from longer terms,the sector presents itself as a long-term income option for many investors.Figure 18 compares

100、 average healthcare capital rates to that of 30-year gilts,with an average spread of 1.65%between the two.Source:Knight Frank Research,MSCISource:Knight Frank ResearchHEALTHCARE30-YEAR GILTSFig 17:Risk vs returns(10-year history)Fig 18:Healthcare vs 30-year giltsTotal returns(%)141312111098765432106

101、8101214Risk(standard deviation)024HealthcareResidential(PRS)HotelAll propertyOfficeEducation*RetailIndustrialLower riskHigher risk876543210200220032004200520062007200820092010201120122013201420152016201720182019202020212022Seeing the bigger pictureFig 19:Healthcare returns vs CPI(20122022)151050-5-1

102、0-1520122013201420152016201720182019202020212022INCOME RETURNCPITOTAL RETURNCAPITAL GROWTHFigure 19 showcases the trend in healthcares total returns from 2012,and the contribution of both income and capital returns towards this.Owing to consistency,income return has been a fundamental factor in tota

103、l returns able to trend above CPI,with the exception of two periods,to support the long-term income credentials of the sector.Taking a step back from the now,and indexing total return along with CPI over the period in question,total return substantially outpaces CPI.This again points to the view tha

104、t investment in the sector is a long play to deliver a comforting positive sentiment from market participants,despite the various headwinds.Source:Knight Frank ResearchFig 20:Healthcare total returns vs CPI(indexed)TOTAL RETURNCPISource:Knight Frank Research1,6001,4001,2001,00080060040020002012 2013

105、201420152016201720182019202020212022“Due to conventional healthcare leases benefiting from longer terms,the sector presents itself as a long-term income option for many investors.”HEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 20232021Deal typePrice mDatePropertiesPurchaserSectorPortfolio

106、200Dec 221Civitas Social HousingAdult care/Supported livingPortfolio45.5Sept 223Aedifica NV/SA(Belgium)Elderly carePortfolio78.5Jun 223Impact Healthcare REITElderly carePortfolio58Apr 221Assura PCP UK LtdPrimary careSingle asset31Apr 221Primary Health PropertiesPrimary careTable 4:Notable transactio

107、ns completed by REITs 2022Source:Knight Frank,Property DataREITs in the spotlightSimilar to the increase in demand for healthcare assets,the presence of healthcare REITs among investors has grown.With domestic REITs accounting for 655 million,or approximately 28%of 2022s transaction volume,this has

108、seen the gap significantly close on interest from overseas capital.This section of the report looks into the seven key healthcare REITs,which,at the date of their 2022 interim reports,had a combined portfolio value of 9.86bn across 2,669 care assets,producing a total rent roll of circa 526 million p

109、er annum.Over the years,these REITs have continued to grow in terms of portfolio values.Figure 21 presents these REITs by AUM,with Primary Health Properties being the largest,reporting a valuation of 2.9bn as at June 2022.In terms of combined value,due to a mixture of acquisition and organic growth,

110、this has increased from 6.99bn to 9.86bn between 2019 and 2022;an approximate 41.2%growth over the period or 12.2%on a compounded annual growth rate(CAGR)basis.As seen by the overall healthcare returns relative to other sectors,figure 22 represents the performance of healthcare REITs in comparison t

111、o all property REITs and the FTSE 250.Following 2022s use of this chart,we can see healthcare REITs continued consistency and divergence away from the“all REIT”line.While the FTSE 250 line continues to trend above healthcare REITs overall,we should note this will most likely be down to the early str

112、ong performance of financial services and energy equities that have indirectly capitalised on rising base rates and inflationary pressures.Nonetheless,the performance of healthcare REITs,when compared to all property and the FTSE,is a supporting argument for the case of healthcare and its long-term

113、credentials.“Primary Health Properties presents as being the largest REIT,reporting a valuation of 2.9bn as at June 2022.”7Key UK healthcare REITsUK HEALTHCARE REITS IN NUMBERSSource:Macrobond,Knight Frank HEALTHCARE REBASE JAN 1 2020=100ALL REITS REBASE JAN 1 2020=100FTSE 250 REBASE JAN 1 2020=100F

114、ig 22:Healthcare REITs vs all REITs vs FTSE 2501401201008060402002020202120222,669Combined number of assets9.86bnCombined asset value526mCombined annual rent roll18.3yrsAverage WAULTSource:Company websites,data based on 2022 mid-year or interim reports*European REIT with significant UK based portfol

115、ioFig 21:Healthcare REITs by AUMTriple Point:Supported housing Portfolio:670mImpact:Care homes Portfolio:569mPrimary Health Properties:Primary carePortfolio:2.9bnAssura:Primary care Portfolio:2.8bnAedifica:Elderly care Portfolio:1bn*Civitas:Supported housing Portfolio:1bnTarget:Care homes Portfolio:

116、912mHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 20232223Source:Knight Frank Research,Oxford Economics,Macrobond,Capital Economics,OBR*Bank of England Feb 2023 forward interest rates,market perception of future ratesFig 23:Predicted Bank of England peak base rate(BoE base rate forecasts

117、%)Debt market update Over the past year,the debt market has been dominated by news of monetary tightening,driven primarily by attempts to control and reduce inflation.Interest rates in the UK have risen 11 consecutive times and currently sit at 4.25%compared with 0.50%only 12 months ago.The increase

118、d cost of debt has impacted borrowing costs and investor returns,in addition to putting pressure on interest cover ratios.The question is,have interest rates hit their peak?The market was still pricing in a 0.25%increase in the 12 months leading to March 2023.However,the expectation is that rates wi

119、ll begin to soften towards the back end of 2023(see figure 23).The extent to which rates come down(or the length of time they will remain at peak levels)will be dependent on inflation data showing some downward movement(see figure 24).Current expectations show inflation reducing to 2.90%by the end o

120、f the year,which will be hugely welcomed and should signal the end of monetary tightening.The banking sector more generally is not without its challenges,demonstrated recently by the Source:Knight Frank Research,Oxford Economics,Capital Economics,OBR *Bank of England Feb 2023 CPI forecastFig 24:Pred

121、icted inflation rates(UK CPI forecasts,%change year-on-year)collapse of Silicon Valley Bank and Credit Suisse.However,UK banks have proven to be resilient and well capitalised post the global financial crisis.Sensible lending decisions over the last decade mean banks will be well placed to weather a

122、ny storm,alongside the large number of new alternative lenders that continue to provide invaluable sources of liquidity in todays debt market.HOW HAS THIS IMPACTED THE AVAILABILITY OF DEBT IN THE HEALTHCARE INVESTMENT MARKET?Lender appetite for the healthcare market has remained resilient,largely be

123、cause the healthcare sector is dominated by a number of relationship-driven and sector-specialist lenders.These lenders have continued to support operators over the years and are well versed in sector dynamics and performance metrics.While debt pricing has increased in the past 12 months,this has pr

124、imarily been driven by underlying interest rate rises.Margins in the sector have remained broadly stable,with senior debt pricing for core assets seen in the 200s.The big banks are now focusing on financing larger-ticket investment transactions,which is leaving challenger banks and debt funds to fin

125、ance smaller care home deals,both development and investment.A focal point for all lending decisions in the last 12 months has been ESG requirements.In that regard,financing healthcare 2.90%Current expectations show inflation reducing to 2.90%by the end of the year,which will be hugely welcomed and

126、should signal the end of monetary tightening.sector transactions provides ample opportunity for lenders to demonstrate their support of social care and community-driven developments.Our expectation is that financing into the healthcare sector will remain stable throughout 2023,due to its specialist

127、financing requirements,coupled with the undeniable and ongoing demand for quality healthcare provision across the UK.“Sensible lending decisions over the last decade mean that banks will be well placed to weather any storm,alongside the large number of new alternative lenders that continue to provid

128、e invaluable sources of liquidity in todays debt market.”LISA ATTENBOROUGH,PARTNER,KNIGHT FRANK CAPITAL ADVISORY,DEBT121086420-220212022202320242025202620202021202220232024202520262027OXFORD ECONOMICSCAPITAL ECONOMICSBANK OF ENGLAND FEB 2023*OBR MARCH 2023 FORECAST543210OXFORD ECONOMICSUK BASE RATEC

129、APITAL ECONOMICSBANK OF ENGLAND FEB 2023 MARKET IMPLIED BANK RATE*OBR MARCH 2023 FORECASTHEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 20232425Technological advancement and efficiencies within healthcare are nothing new.To take just one example from the 19th century,the modular hospitals

130、 designed and built by the illustrious engineer Isambard Kingdom Brunel for Florence Nightingale the so-called Nightingale Hospitals had a major impact in reducing disease and death.Comparatively,the confluence of healthcare,property technology and venture capital is in its infancy.However,year-on-y

131、ear we are seeing more money spent on innovation and efficiencies across the board.Since the average human spends around 90%of their time indoors,one emerging opportunity is to improve the air quality within buildings.One business doing just this is Pathogen Reduction Solutions(PRS),whose air-handli

132、ng system was designed initially in response to the Covid-19 pandemic.This patent-pending,proprietary application of UVC technology is retrofitted into existing or new-build air-handling systems,and inactivates 99.9999%of dangerous airborne pathogens within a building.Effective air sanitisation redu

133、ces disease transmission among occupants,enabling landlords and building managers to get health facilities back to full occupancy,as well as building resilience against future pathogen-based health threats.When discussing the sustainability benefits of the PRS unit,founder Ian Sinclair says,“PRS als

134、o delivers significant,sustainable energy efficiencies and environmental benefits over the life of the asset.PRS achieves this by reducing the total power needed to run the adapted heating,ventilation and air conditioning(HVAC)system through safe recirculation of indoor air,rather than relying upon

135、100%outside air,which needs energy-consuming conditioning(temperature adjustment,dehumidification,etc).The order of magnitude of any improvement is material when considering that HVAC systems account for approximately 40-45%of a typical buildings power consumption.”Another opportunity we have discov

136、ered is internal building navigation for the blind,disabled and able-bodied.A frustration shared by many is turning up to a hospital or medical facility and not knowing where you are going(of the 122 million appointments booked in 2022,around 6.4%were missed.Of these 7.8 million missed appointments,

137、*it is reported a large majority were missed through people getting lost or not knowing where they were going.With current GPS-based navigation apps hampered by indoor inaccuracies,WayMap has developed an indoor navigation phone app that requires no external signals and is accurate to one step.Initi

138、ally developed for people with visual impairments,but with countless uses for the general MAX BEARD,BSC(HONS)MRICS,PROPTECH ANALYSTThe presence of tech in healthcareThe technological impact on the healthcare sector can be broken down into two areas:the buildings from which the care is conducted,and

139、the provision of care itself.Both of these present their own technological opportunities to the industry and investor alike.public,the app can navigate a person to any inputted waypoint.WayMap has a solution that benefits the healthcare sector,from mapping care homes and medical facilities for the v

140、isually impaired,to providing route guidance for patients and visitors.It is an exciting time to be involved in the healthtech space.There are many opportunities and great companies that will help drive both revenues and a higher level of service for all healthtech stakeholders.The implementation of

141、 wearable technology,for example,will allow doctors to monitor and measure a patients health trends to help manage chronic conditions and prevent serious illness.In addition,developments in artificial intelligence can be used to analyse medical data,develop personalised treatment plans and run build

142、ings more efficiently through smart controls.*“NHS drive to reduce no-shows to help tackle long waits for care”,NHS England,January 11 2023.Note:Knight Frank does not endorse any company mentioned in this section and therefore this commentary should not be taken be taken as a recommendation in any f

143、orm.“Since the average human spends around 90%of their time indoors,one emerging opportunity is to improve the air quality within buildings.One business doing just this is Pathogen Reduction Solutions.”“It is an exciting time to be involved in the healthtech space.There are many opportunities and ma

144、ny great companies that will help drive both revenues and a higher level of service for all healthtech stakeholders.”CommentaryJOCELYN ORMOND,PARTNER AND HEAD OF HEALTHCARE&LIFE SCIENCES,ASHFORDS LLP We are continuing to see venture capital and private equity investors,as well as operators we know i

145、n the sector,allocate growing amounts of capital to digital health technologies.The tailoring of these solutions to existing ways of working,the need for appropriate data sharing,and the convergence of healthcare with other technologies such as fintech and proptech,are accelerating the digital trans

146、formation of care provision.There is an enormous amount of commentary regarding the impact of tech on the provision of care,but its impact on the buildings from which the care is conducted deserves the greater attention it receives here.HEALTHCARE CAPITAL MARKETS 2023HEALTHCARE CAPITAL MARKETS 20232

147、627Strong healthcare demand and transaction volume to comeDespite clear headwinds,the underlying drivers for healthcare will support demand and performance.As in previous times of uncertainty,the sectors resilience will shine through in the coming year.Further overseas capital penetrationThe current

148、 climate,while presenting a great amount of uncertainty,will also present opportunity for savvy investors and operators.Those with significant cash piles,or who are less reliant on debt in terms of the origin of their capital,will likely seek opportunity where others are hesitant or priced out of th

149、e deal.As healthcares underlying fundamentals remain intact,we imagine the sector will continue to attract investment from outside the UK.Standing investments and pre-existing stock may present an opportunity for investorsThe upgrading,refurbishment or repurposing of standing assets for example,olde

150、r,smaller and less fit-for-purpose buildings may present a viable value-add strategy for operators and investors across the sector.Conventional bank debt will likely become less prominentDebt and financing could become more creative and present in a number of different forms,as we see private equity

151、 return with the need to deploy committed capital.ESG to featureSocial impact/ESG will continue to feature.This is a growing area,and the nature of healthcare as a sector means the social element is well supported.Cost inflation is a factor to consider for both operators and investorsInflationary pr

152、essures such as food and energy costs will be a point to watch for operators in managing their bottom lines,as the extent to which this can be passed on to consumers approaches its ceiling.2023 PREDICTIONS In addition to promising transaction volumes,we are also seeing more active domestic capital.T

153、his is another sign of positive sentiment as REITs and private capital eat into the share of transaction volume attributed to overseas capital.Additionally,a more consistent and organic trend of transactions lends support to the view that the current level of demand for the sector is sustainable in

154、both the short and long term.Social impact and ESG will continue to drive interest towards the sector,due to the person-centred nature of healthcare creating a case for social impact investing.Both investors and occupiers will be searching for buildings with viable ESG credentials in line with their

155、 net zero and overall sustainability targets.Inflationary pressures such as energy,staff and food costs will be a point to watch for operators in managing their bottom lines as well as investors when underwriting deals and assessing rent/rent covers.Those with a reliance on debt will be exposed to t

156、he possibility of less desirable terms and therefore become more particular in their pricing of deals,creating opportunity for equity-based money to capitalise.It is,however,important to note that the debt situation may not be as negative as the news suggests,due to a number of investors under fixed

157、 terms as well as hedged with conservative loan to values.Healthcare as a sector certainly sits in a less exposed position than more conventional commercial real estate sectors.The upgrading or repurposing of standing assets for example,older,smaller and less fit-for-purpose buildings may present a

158、viable value-add strategy for both investors and operators.Overall,the sector is well positioned with regards to demand,capital awaiting deployment and the underlying drivers that have contributed to the sectors consistent performance over the years.JULIAN EVANS,HEAD OF HEALTHCAREDespite a clear set

159、 of challenges,2022 was yet another positive year for healthcare,with strong transaction numbers as well as continued improvement in the average occupancies of operators.This,coupled with the ever-ageing UK demographic driving demand for care beds and more capital turning to defensive sectors,sugges

160、ts we can be confident these trends will continue.Forward view“The upgrading or repurposing of standing assets for example,older,smaller and less fit-for-purpose buildings may present a viable value-add strategy for both investors and operators.”We like questions.If you have one about our research,o

161、r would like some property advice,we would love to hear from you.Recent researchChildcare&Special Educational Needs Overview Frank Childcare&SEN Overview 2022 Report UK Healthcare Property Market Overview 2022/ Frank UK Healthcare Property Market Overview 2022/ Healthcare continues to be driven by t

162、he rapidly ageing populationInvestment volume up 17.4%on the yearLack of consolidation in a number of countries may present an interesting opportunity Elderly Care Market,Research 2022European H Frank European Healthcare Report 2022Agency use as a percentage of staff cost falls year on year2022 UK C

163、are HomesTrading Performance R up for a Healthy FutureKnight Frank 2022 UK Care Homes Review Knight Frank LLP 2023.This document has been provided for general information only and must not be relied upon in any way.Although high standards have been used in the preparation of the information,analysis

164、,views and projections presented in this document,Knight Frank LLP does not owe a duty of care to any person in respect of the contents of this document,and does not accept any responsibility or liability whatsoever for any loss or damage resultant from any use of,reliance on or reference to the con

165、tents of this document.The content of this document does not necessarily represent the views of Knight Frank LLP in relation to any particular properties or projects.This document must not be amended in any way,whether to change its content,to remove this notice or any Knight Frank LLP insignia,or o

166、therwise.Reproduction of this document in whole or in part is not permitted without the prior written approval of Knight Frank LLP to the form and content within which it appears.Julian Evans,FRICSHead of Healthcare+44 20 7861 HealthcareNick Kempster,MRICS Partner+44 20 7861 5265 Ryan RichardsSenior Analyst,Healthcare+44 20 3869 Commercial researchKieren Cole,MRICSPartner+44 20 7861