**1.1 Healthcare property in the Netherlands**

The prospects for investing in healthcare real estate are positive and investments [1] will therefore increase. This is evident from the 2015 Healthcare Real Estate Barometer, among others. Dutch healthcare organizations have been responsible for their own real estate since 2012, and thus investing in care locations is still at the beginning of its development. This is different in other countries. There, it is common for different investors to invest in care and cure real estate. Foreign investors see opportunities when they look at the Dutch healthcare real estate market. A plus in that, for example, is that Dutch institutions, against the economic trend, have growing solvency and equity have.

The 2015 Healthcare Real Estate Barometer [2] includes a comparison with healthcare real estate investments in other countries included. Australia and the United Kingdom have a longer history in terms of healthcare real estate investments. The total return on investment in real estate is the highest (7.5%) in Australia over the 2007–2013 period. For healthcare real estate, that total return in Australia, for example, is higher (11.1%).

An important point is that within healthcare there are many differences. Take the difference between care and cure. Care currently still scores a lower return on real estate than cure. That is mainly caused by current developments within the General Act on Exceptional Medical Expenses (AWBZ) and the Long-Term Care Act (Wlz), as a result of which funded nursing homes are becoming vacant. In the United Kingdom [2], the care property portfolio has been reviewed to ensure that it fits well with the evolving demand for care and supply of care property which has also resulted in higher care property yields.

#### *1.1.1 Robust business case*

For further development and investment in healthcare real estate, the healthcare sector currently has currently has a limited choice of a number of Dutch banks. Developers, investors and construction companies [3–6] are more interested in Dutch healthcare real estate, but are still relatively unfamiliar with it. Foreign investors do dare to investments based on their experiences outside the Netherlands. Healthcare institutions are increasingly taking the initiative for other forms of financing and investments and are looking for other forms of loan capital. An example of this is the new healthcare bond fund. Foreign investors could also be a party for this. We are mainly talking about long-term investors who are looking for stable investments with reasonable returns. Many providers are wondering how to interest investors in their real estate activities. Of importance is a robust business case [6]: investors are concerned with the future prospects of the entire healthcare organization. You have to be able to explain what the long-term plans of the organization as a whole are and how healthcare real estate plays a good and therefore flexible role in that fulfills.

#### *1.1.2 Invest more and differentiate*

In this part are the most recent developments in the field of healthcare real estate. This will help provide insight into developments and opportunities for developers, investors and construction companies. The prospects for investing in healthcare real estate in the Netherlands are positive and investments will therefore increase. Healthcare real estate will continue to professionalize with robust business cases from healthcare institutions. This will develop further by increasingly connecting to the further demand for care and the corresponding supply of real estate.

An attitude of investing more and differentiating more makes real estate flexible so that a good fit with healthy aging and hospitality, the underlying success factors of players in the healthcare (real estate) market [7].

### **1.2 Healthcare property in the Netherlands**

What is going to change in healthcare real estate in the Netherlands:


### *1.2.1 Definition of healthcare real estate*

There is no exact definition of healthcare real estate in the Netherlands. Care real estate as social real estate can be defined as "The specific characteristic of the social real estate relates to (a) a building-related communal activity and (b) the provision and facilitation of that need of stakeholders from a recognized social interest ([8]: p. 67).' Care real estate is therefore real estate that is directly or indirectly related to healthcare services and makes a supporting contribution to a healthcare operation.

Healthcare real estate includes buildings with very diverse functions [9, 10] and characteristics such as health centers, clinics, residential care centers and hospitals. Because there are diverse buildings with different types of healthcare operations fall under the term healthcare real estate, different valuation methodologies are also common. The common factor between methods is that the (healthcare) operation that takes place in the real estate plays a role in determining the value and thus the investment. Because of this, there are investing similarities with other types of operating real estate such as vacation parks, hotels or other primary process driven organizations.

In the healthcare sector, a distinction is made between the cure and care sectors. Cure is focused on healing. The real estate that falls under this sector includes hospitals, primary and secondary care centers and (rehabilitation) clinics. Those in need of care come to this real estate for a temporary stay that contributes to healing or recovery from their illness. Care is focused on care. The real estate that falls under this sector aims to limit the disadvantages of diseases, disorders and limitations as much as possible. The real estate belonging to this sector include residential care centers for the elderly, mental health care and disability care. People in need of care live here for long periods to be cared for.
