See clearly, invest wisely

As a specialist broker, we focus our attention on the sectors and on the changes in social structures. In our FAQ section you will find relevant facts, data and information about your investment in healthcare real estate. This section is continuously updated. If you still can’t find the answer to your question, please feel free to contact our team of experts.

TERRRANUS recommends carrying out a SWOT (strengths, weaknesses, opportunities, threats) analysis as part of a due diligence process before investing in a property. With the help of our digital analysis tools, which interconnect tens of thousands of relevant data, we advise you during the buying process, in portfolio analyses and broker valuable properties for you. We assess the competitive situation on the local market, taking into account all socio-economic factors, support you in drafting and negotiating contracts, as well as in determining sound pricing. We ensure transaction security right up to the notary appointment.
Not every property is suitable for every operator. From the investor’s perspective, in addition to the operator’s creditworthiness, a promising operating concept is an important evaluation criterion for securing an investment in the long term. With the growing number of care models and the political will to further expand the care infrastructure, the demands on operators are also increasing. Questions such as what areas of expertise are necessary for new business models and how the necessary staff can be recruited are increasingly coming into focus. How is the business model calculated, is it profitable and are the operator’s approaches sustainable? The successful further development of a facility can also be tied to the redesign of the property. Therefore, it is crucial for the operator to find a partner who will support the development process. Sometimes it is also worth acting via third parties, as the multitude of players is now almost impossible to keep track of. TERRANUS offers specialist real estate brokers and operational experience on the operator side, we check the facts that are important for your investment.

In daily valuation practice, the transaction of healthcare properties requires a differentiated methodology and knowledge of market data, risk potential and legislative framework conditions. After all, healthcare properties are also always management properties.

The following parameters must be taken into account:

  1.  Care homes can only be converted to a very limited extent.
  2. Legally regulated investment follow-up costs limit the amount of nursing home rents.
  3. New regulations in the state nursing home laws, such as the single room quota, must be implemented, leading to a reduction in the number of care places and thus to declining revenues for the operator.
  4. In the event of an operator insolvency, there is a risk of loss of rent.

But how can all parameters be correctly weighted, how can the market value of a healthcare property be reliably determined? TERRANUS offers both expertise as a healthcare real estate agent and experience as an operator.

If investors don’t want to be stumbling around in the dark and want to know exactly what the respective care property is worth on the market, there is no way around a complex analysis. This includes the evaluation of tens of thousands of data, as guaranteed by the TERRANUS analysis tools. The interpretation of this broad factual evaluation then enables a reliable valuation and thus a safe investment decision.

Whether the location and operator concept fit together and are suitable for a successful investment depends on many different factors. With its various database analysis tools, TERRANUS checks the parameters that are important for your investment. We carry out SWOT (strengths, weaknesses, opportunities, threats) analyses, evaluate the market and filter out the true values of a healthcare property for you. In addition, we find the assets of value for you, uncover weak points at an early stage and adapt the process.

According to the Federal Statistical Office, there will be around 24 million people over the age of 65 in Germany in 2040. This development calls for visionary entrepreneurs and investors. For example, it is important to include future digitisation in the realisation of new living concepts and residential care facilities as well as in service and care structures – from smart homes and potential assistance systems to autonomous driving services and “accompanying” robots.

Anyone who invests in a healthcare property without detailed analyses, based only on their gut feeling, is ill-advised – or has done without industry experts. Because the market for healthcare and senior residential properties follows its own laws, is complex, highly fragmented and not very transparent. Market data and the interpretation of figures form a solid basis to gain an overview of the market for healthcare properties and nursing homes. TERRANUS combines precise market know-how with operator knowledge as well as real estate expertise and checks the facts that are important for your investment. How does the current care policy affect the operation and the property, and could this jeopardise the rental payment in the long term? Where is there already a shortage of care places today? Is the operating company in your property strategically well positioned for the coming years? TERRANUS determines the true values of a healthcare property, our expert knowledge lays the foundation for stable returns, our experience provides the necessary security for your investment. Based on our precise market knowledge and many years of experience, we advise you on the right choice of healthcare real estate as well as the operator and support you along the entire value chain.

If a healthcare property gets into difficulties, the problems of the operator are or become problems of the owner as well. In order to recognise warning signals at an early stage, TERRANUS recommends active monitoring as part of asset management. We observe the development of your investment and in parallel all relevant market and competitive parameters in order to be able to quickly counteract subtle or under-the-radar developments. 5 tips for owners:

  1. If a rent or lease payment is not received, owners should immediately seek dialogue. We will then find a suitable operator for you or step in as interim manager at short notice.
  2. Keep an eye on the occupancy rate. The national average is 91 per cent.
  3. The management of a nursing home is always a local business.
  4. Ask: How are the residents, how are the staff members? The information gets around and determines the future success of your real estate investment.
  5. Implement maintenance work quickly so that your care property does not lose its appeal.
The differentiated market analyses from TERRANUS provide a well-founded forecast of whether the rental payments for your property will also be secured in the future. Based on the data from our digital tools, they interpret the property’s future opportunities and risks with a great deal of market knowledge. And these analyses are essential. Because in rental negotiations for nursing homes, the legislator always sits at the table alongside the landlord and the operator. The legislator limits the refinancing of rents and index regulations via the investment follow-up costs – sometimes even for existing contracts. With our continuous monitoring, reporting and benchmarking, we therefore observe not only the regulatory framework conditions but also all parameters that influence the economic situation of the facility and ultimately also the refinancing of the property. With the Care Atlas, monitoring and the TERRANUS Investment Cost Index, we provide you with exact market data and reliable instruments to track the development of rental prices for nursing homes and to stay informed about the market for nursing homes, senior living and healthcare properties. You thus optimally secure your investment. As a database-supported, continuously updated analysis tool, the TERRANUS Care Atlas provides the necessary facts and information for this.
For investors and property owners, a solid determination of market value is crucial, but this is extremely differentiated in the case of a healthcare property. In daily valuation practice, a methodology specialised for care facilities and a great deal of knowledge about market data, risk potential and legislative framework conditions is required. TERRANUS recommends a complex SWOT (strengths, weaknesses, opportunities, threats) analysis in advance. After all, in addition to the already numerous parameters, there are also new legislative requirements from 16 state home laws including ordinances. In concrete terms, this means that in addition to the derivative of the customary market returns from the investment follow-up costs for the nursing care rate, prescribed single room quotas and sizes, minimum sizes of common areas or maximum living area sizes also have a significant influence on this. This makes a solid valuation even more complicated for investors, capital-providing banks, auditors and experts. Thanks to our digital analysis tools (Care Atlas, KPI rating and standardised evaluations), we are always up to date.
Due to the demographic development and the expected population increase in the 65+ age group of almost 50 per cent by 2040, investors can also expect a solid return on their investment in healthcare properties in the future. This is because the investment is future-proof and extremely independent of economic cycles. In inpatient care, the quality of the premises, the reputation of the operator and a functioning team of care-givers are among the success factors. In the meantime, highly diversified offers that combine everything from service and outpatient assisted living to shared care housing or day care in one residential complex are particularly future-proof. Different sizes, equipment levels of flats or small bungalows enable individual offers, depending on whether a more luxurious or more affordable flat is sought, whether for a single person or a couple. In order to operate successfully here, the location is key. An inner city or city district location with good infrastructure, local amenities and public transport forms the basis. TERRANUS advises banks and investors on the selection of suitable healthcare real estate and is also on hand after the investment decision has been made. We know when, where and how healthcare property pays off and share our knowledge with investors so that they can invest safely and profitably.
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