Scene set for evolution of healthcare, retirement living sectors

New participants are set to emerge in Australia’s healthcare and retirement living sector in 2018, while institutional players are likely to reposition and expand within the sector.

“Healthcare in 2017 was a mix of activity ranging from decline to buoyant growth, depending on the sub-sector,” Shalain Singh, Colliers International Head of Healthcare & Retirement Living, said.

“Regulatory reform across the healthcare continuum, negative press on retirement villages and free flowing capital from both onshore and offshore participants meant that transactional activity was driven primary by institutional and mid-to-large corporate organisations.

“Activity was most prominent in the hospital sector, followed by residential aged care.

“Retirement living emerged as the asset repositioning play, with Lendlease selling part of its retirement living business and medical centres stagnating as the large players review their portfolio and service mix.

“From the viewpoint of strategic planning, all sub-sectors were equally as active with many focusing their attention on how to diversify their service provisions especially in the context of convergence across the healthcare spectrum.

“As a result, 2018 is likely to result in the institutional players repositioning their portfolios and expanding both their reach (volume and scale) as well as what they provide by integrating multiple forms of services and associated accommodation.

“Lastly, with the availability of capital from all sources and alternative asset classes for investment being sought, it is likely that new participants will emerge especially in the retirement living sector.”

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