Healthcare to drive property investment

Property developers in the Mena region are continuously looking at alternative asset classes. Health care is under-developed relative to an ageing and increasing population in the region. That in conjunction with the rise in medical tourism presents investment opportunities for developers.

Medical tourism industry is a US$50bn market globally and the health care goes way beyond the medical tourism, it is part of the social infrastructure - soft infrastructure - that UAE has realised the importance of and the Government is trying to seek more investments into that.

With a growing Mena population, to maintain the current provision rate of 1.9 hospital beds per 1,000 people, an additional 10,500 beds, equal to 70 new hospitals, will be needed in the five major cities across the region by 2022. It's not just large hospitals that are garnering interest among potential investors. Big developments are increasingly integrating clinics and other medical facilities within retail and office spaces.

While demand is set to grow across the Mena region, Mr Plumb of JLL reports said Saudi Arabia offered most scope at the moment.

“I think the opportunities for the [healthcare] real estate sector are probably bigger in Saudi Arabia than they are in the UAE and that’s partially because of the size of the economy and partly because the healthcare sector is already heavily influenced by the private investors.

"The short term opportunities are in Saudi cities like Riyadh and Jeddah," he said. "The PPP law is also under way as well in the kingdom. It is work in progress.

“In Saudi the government will privatise some the existing healthcare facilities and they are looking to expand and modernise and they are looking at private capital to do that. Ministry of health has tenders out already.” Read more