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Hospitals and healthcare assets have been hot property in 2023, immune from the headwinds impacting core real estate markets in Australia.
And underpinning the resilience of healthcare and subsectors is Australia’s growing and ageing population, according to Dexus Healthcare Property Fund (DHPF) manager Jemma Maddick.
With almost $2 billion in healthcare assets, Dexus is one of Australia’s bigger healthcare property players, with 12 assets in its portfolio.
In July this year Dexus raised a further $220 million for its healthcare property fund to add to its portfolio and further diversify its holdings.
Speaking ahead of The Urban Developer healthcare summit where she will be speaking, Maddick said there were growth opportunities in some key subsectors that the property fund was targeting.
Maddick said Dexus had focused on specialist private hospitals and mental health where she said there was “huge demand”.
“Day surgery hospitals are another area where I think there’s going to be more growth as you see treatment times reduce and theatre utilisation increase,” she said.
“Life sciences is also a massive growth area. Covid really showed how far behind Australia was on its life sciences investment.
“We’re definitely seeing more of a demand in our portfolio for life science space.”
Future-proofing healthcare assets comes down to close collaboration with long-term tenants and embedding adaptability into the design of the built form. Maddick said they worked closely with key tenants, such as Ramsay, to “ensure our facilities can accommodate their business as it changes, because how healthcare is delivered now, is not how it will be delivered in 10 years’ time”.
Precincts were also a focus for Dexus’s institutional capital where it could develop co-located healthcare assets such as Dexus’s $500-million Bragg Centre in Adelaide.
The biomedical facility will be the first in the southern hemisphere to offer groundbreaking proton therapy treatment.
Dexus has also partnered with the South Australian government to invest in the Royal Adelaide in a private partnership model.
“We also have a focus on mixed-use healthcare assets like the North Shore Health Hub in the Royal North Shore precinct,” she said.
“And underpinning the growth [of healthcare] is the combination of huge population growth and an ageing demographic. The demand is going to outweigh the supply and the government is going to need robust, efficient and sustainable private healthcare partners to assist to meet that demand.
“Key-worker housing is definitely something that is being considered as part of health precinct, it is going to be a key piece because you do see the mismatch in the availability of suitable accommodation and attracting and retaining staff, which is crucial to viable precincts.”
The Healthcare Real Estate vSummit will take place virtually on Thursday, November 30. Click here to register and learn more.
