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Yield opportunity – for experts, yes.

Around 6 percent yield per year is enticing – especially in a growth market entailing moderate risk. Markus Bienentreu, CEO at TERRANUS, explains what matters when buying healthcare properties.

Around 6 percent yield per year is enticing – especially in a growth market entailing moderate risk. Markus Bienentreu, CEO at TERRANUS, explains what matters nevertheless when buying healthcare properties.

Terranus Information and insight Yield opportunity für experts

In the meantime, some care home property purchases are recording prices that are 15 times above annual rent. Does that make sense? “Yes – but you have to differentiate clearly,” says Markus Bienentreu, CEO at TERRANUS. A realistic view of a lucrative growth market can be gained at EXPO REAL, the leading sector trade fair where TERRANUS is represented on the conference program.

Entering into risk – and knowing where to

Secure market potential – that is also independent of economic cycles: it’s no wonder that high demand is encountering the problem of ever fewer properties – at ever higher prices. Bienentreu notes: “The drawback is that many investors lack experience in the care segment. They quickly overestimate or underestimate both the opportunities and the risks involved. Only a differentiated analysis leads to successful investment decisions – and you need a lot of expertise to perform such an analysis.”

More expensive, but with a clear yield premium

This is because – despite prices having risen – healthcare and senior housing continues to generate higher yields than classic real estate segments such as office and retail.
Three reasons suggest this situation will continue in the future:
1. Germany is ageing, with strong market growth being as good as guarantee
2. Dynamism derives from demography and is independent of economic cycles
3. Investments in care homes are highly crisis-resistant as a consequence

Local quality decisive

Local expertise is needed to benefit from this potential, however. The reputation a home enjoys, its capacity utilisation, whether it attracts qualified staff, are all factors that are practically always decided locally. Investors should beware of empty promises. “Investors without precise market knowledge who describe a healthcare property purchase as an absolutely secure investment type are not to be taken seriously. The exact opposite is the case in practice – the devil is always in the detail. This is precisely where our expertise comes to bear – in the differentiated analysis of all success factors – thereby providing a solid foundation for all investments.”

Podium discussion at EXPO REAL

In the EXPO REAL conference program, TERRANUS covers just these details and the question “Invest in care?” Carsten Brinkmann, TERRANUS Supervisory Board Chairman, responds to some of these questions:

 

SPECIAL REAL ESTATE FORUM
Care Real Estate Market Germany
CBRE immoTISS Care Reports 2016
Language of lecture: German
Wednesday 05.10.2016 / 10:00 – 10:50
Hall C2, Stand 040

You can find more figures, data and facts about the healthcare property market in the TERRANUS Care Report on pages 8 and 9, as well as 14 and 15. Here, you can conveniently order the 2016 edition free of charge.

Questions? Get in touch with us.

Identified – and fixed: Five asset management tips

Risk-free investment? This is also just a pipe dream when buying healthcare properties – but you can cut risk radically by applying these tips from TERRANUS.

Healthcare properties are management properties – an investor’s success consequently also depends on the operator’s business skills. Be sure to take these five tips from TERRANUSl on board and spot potential problems as early as possible.

Terranus Information and insight 5 asset management tips

Errors or even care home insolvencies – both form part of the flipside of an attractive market segment. They also play an important role at EXPO REAL 2016. If a healthcare property gets into difficulties, the operator’s problems are always – or always become – the owner’s problems too.

Installing early warning systems

Active supervision as part of asset management is recommended to identify warning signals at an early stage. It is important to constantly monitor all relevant market and competitive parameters in this context to rapidly implement countermeasures when things start slipping out of control. If the problem can be identified at an early juncture, there is almost always a solution. Healthcare property owners should look out for the following at all times:

Five tips for owners

1. At the latest if one rent or lease payment is outstanding, owners should contact tenants immediately.
2. Keep an eye on your capacity utilisation rate. Making a comparison with previous years is worthwhile. The German average stands at 91 percent, by the way.
3. Managing a care home from a distant central office seldom proves successful. At its core, care is always a local business – something good operators know.
4. Enquire about the well-being of residents and staff. It doesn’t matter what the response is, the word gets around, and it plays a role in future success.
5. Implement maintenance work quickly so your care property doesn’t become less attractive.

Podium discussion at EXPO REAL

Would you like to know more? Then visit us at EXPO REAL. 
SPECIAL REAL ESTATE FORUM
Care Real Estate Market Germany: The Care Branch’s Long Term Growth?
Language of lecture: German
Wednesday 05.10.2016 / 12:00 – 12:50
Hall C2, Stand 040

What owners should look out for in the case of an operator insolvency is also presented in the TERRANUS Care Report on pages 10 and 11. Here you can easily order the 2016 edition free of charge.

Questions? Get in touch with us.

Information and insight for You!

Exciting, entertaining, current: we’d like to share our knowledge about healthcare properties with you. Our online magazine features many articles about current trends, as well as tips, facts and analyses.

Knowledge is the only raw material that increases when consumed. Therefore, we would like to share our knowledge about healthcare properties with you. Our online magazine provides you with a wealth of information on current trends as well as presenting tips, facts and analyses.

Terranus Information insight editorial

A very warm welcome to “Information and insight”, the online magazine for facts and trends revolving around healthcare properties. Markus Bienentreu – CEO at TERRANUS  – is very pleased to share with you his in-depth knowledge of the market and operators. Sometimes as brief-and-to-the-point tips, sometimes as pointed commentary, sometimes as entertaining reporting – but always full of facts and informative.

Benefit from the fact that we master two of the sector’s disciplines at the same time. Firstly, as specialist real estate agents and operating consultants we advise banks and investors in selecting the right healthcare properties. Secondly, we are also Germany’s leading management consultants in healthcare property management.

Worth knowing:

  • Tips that make draw on 20 years of experience
  • Trends deriving from precise analysis tools
  • Comments based on our 360° expertise
  • Interviews showing up connections and illuminating background developments

We look forward to having you as a reader! Enjoy your browsing.

Portrait von Markus Bienentreu, Geschäftsführer der TERRANUS GmbH.

Markus Bienentreu

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