Deployment of institutional capital is crucial to address the growing shortfall in senior housing in the Netherlands

Bouwinvest Real Estate Investors is calling on Dutch municipalities and care providers to harness the financial clout of institutional investors to alleviate the severe shortage of suitable housing in the Netherlands for senior citizens, with or without care needs. This deficit will continue to increase in the coming years, adding further pressure to provide more homes for the elderly, Bouwinvest claims in a recently published position white paper.

Download the position paper here.

The Dutch government has set a target to build approximately 850,000 regular new homes and apartments by 2035, but demand is also growing for suitable accommodation for senior citizens, with different levels of care requirements. This stems from the ‘double aging’ effect of the population as the number of seniors increases and grow older. If older people were to move, it could also free up homes in the residential market.

Erwin Drenth, Director Dutch Healthcare Fund Investments, commented:  "Institutional investors like Bouwinvest are backed by Dutch pension funds and insurers who have capital available and are looking for long-term investments with stable returns and, above all, a positive social impact. Many pension funds have allocated capital for investment in accommodation for the elderly in the non-regulated rental segment as well as healthcare properties."

Housing for seniors has fallen under the jurisdiction of municipal authorities since the Dutch care system reforms in 2013. Healthcare institutions traditionally own their own properties and many continue to do so, with the financial burden associated with real estate ownership continuing to squeeze the budgets of both the care institutions and local governments, Bouwinvest notes. This could change if institutional investors were given the opportunity to use their capital, networks and expertise and shoulder a large part of the investment burden by financing housing for the elderly and care homes.

Bouwinvest calls for more cooperation between municipalities, care providers, institutional investors, housing corporations and developers. The paper claims that by working together to facilitate investment by pension funds in existing homes and new accommodation for senior citizens, all stakeholders in the chain would benefit. Municipalities would be able to free up funds to meet the growing demand for regular housing by cutting their spending on real estate facilities that fall under the social support act (WMO. Healthcare institutions would no longer be confronted with unexpected property expenses, allowing them to focus on their core task of providing care for the elderly.

Would you like to know more about our vision for healthcare real estate? Download our Senior Housing Position Paper here or contact Erwin Drenth, Director Healthcare Investments, via e.drenth@bouwinvest.nl or +31 (0)6 51 36 70 50.