UK - Aegon Asset Management has secured two more institutional investors, through DTZ Investment Management, for its new healthcare real estate fund.
The AEGON Target Healthcare Property fund has now attracted £42m (€48.5m) in commitments, following the additional £12.5m from DTZ’s clients.
The vehicle aims to take advantage of the predicted increase in healthcare needs of the UK’s ageing population, particularly for care homes where increases in longevity will push demand for specialist care.
The fund’s stock selection focuses on high-quality operators with a preference for new build care homes.
It can also potentially invest in critical care, day surgery, dementia care or learning disability units.
The closed-end fund is managed by Phil Clark and Anne Copeland of AEGON Asset Management’s property team.
Clark said: “This latest investment provides further endorsement of the uniqueness and competitiveness of our proposition.
“It also recognises the potential for the fund to provide a future hedge against inflation, as the rental yields are generally linked to the retail price index.
“This latest investment comes at a very challenging time for the property sector, which has seen many of our peers struggling to secure funds for their newly launched products.”
There is growing demand for healthcare facilities in the UK as ‘baby boomers’ retire and their healthcare needs increase.
Figures show 20% of 70 to 74 year olds need some form of assistance with daily living, while for the over 90s this increases to more than 70%.
Furthermore, a significant demographic shift in the UK population means that by 2031 there will be 2.85m people aged over 85, and so AEGON argues that demand for healthcare facilities can only increase over the next 20 years.
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