AXA IM - Real Assets, acting on behalf of a client and as part of its structurally supported alternative asset classes strategy, has completed the acquisition of a portfolio of ten purpose-built care homes in Ireland. The portfolio will be operated by Mowlam Healthcare, Ireland’s largest care/nursing home operator with 1,500 beds across 27 facilities, under new 25 year triple net leases. The portfolio totals some 600 beds and 52 additional independent living units and is almost fully occupied. The single story, modern homes have all been purpose-built since 2002, with approximately 80% of the portfolio featuring en-suite wet rooms and are situated across Ireland.
The Irish care home market is characterised by high occupancy rates and favourable demand/supply dynamics, fuelled by a lack of development activity during and immediately following the global financial crisis as well as ongoing high barriers to entry. The share of the Irish population over 64 years of age is forecast to grow by 55% by 2030, leading to an increase in the demand for care home beds. As the market remains highly fragmented, with 75% of private care beds made up of individual homes operated by single entities/owners, a stronger emphasis is likely to be put on private funding.
This transaction extends AXA IM - Real Assets’ c. €2bn managed healthcare portfolio into the Irish senior housing sector. It follows acquisitions on behalf of clients in the UK, Germany, Italy, Finland, Spain and in France, where a portfolio of eight Paris care homes was purchased last year.
Andrew Ovey, Head of Healthcare at AXA IM - Real Assets, commented: “This portfolio acquisition allows us to enter what is a fast-growing and demographically supported sector. Given the quality of the portfolio and its high occupancy rates, this investment is expected to offer our clients the opportunity to benefit from capital value growth across the portfolio as well as long-term, sustainable income. At the same time, working alongside Ireland’s market leader Mowlam Healthcare should ensure we are well positioned to benefit from further opportunities which may arise in what is a hugely fragmented and undersupplied market.”
