Of the 11 vacant aged care homes (560 beds) that real estate firm CBRE has sold in the last 18 months, eight (390 beds) were sold to non-aged care operators.
CBRE’s Sales and Leasing in Aged Care, Marcello Caspani-Muto, told The SOURCE that rising construction costs mean vacant aged care homes are highly sought after – but they are not being bought by cash-strapped aged care operators.
Larger homes (over about 60 beds) are being sold to healthcare operators, while smaller homes are generally being converted to disability housing. Some of the properties are refurbished and then leased back to aged care operators, but this is a “slim market”, said Marcello.
Previously, vacant aged care homes were mainly sold for their land value.
Marcello said Queensland is beginning to see the same trend, and there’s also signs of demand for vacant aged care homes picking up in NSW too.
While “transactionally” the trend “is great,” Marcello said he worries the sale of aged care homes to non-operators will cause a shortage of beds in the future.
Operators are buying “very few” greenfield sites and delaying new builds. The cost of building and operationalising new homes is at about $400,000 per bed. Refurbishments are also being put on the back burner due to rising costs.
It’s already “too late”, Marcello said. There will be a “lag” between when the beds can be built and when they will be needed for the ageing population.
“There’s going to be a huge, huge shortage of aged care beds,” he said.
The trend is seen in the recent acquisition of the 8,500 sqm site of the former Uniting AgeWell Carnsworth Community aged care home in Melbourne’s leafy Yarra Bend. The site in Kew has been acquired for $35 million by property developer Piccolo and will be turned into luxury apartments, news.com.au has reported. Uniting AgeWell was expecting $28 million for the site.
The SOURCE: With more aged care beds being lost, and few in the construction pipeline, it's all pointing to them becoming “rolled gold” as the population ages.
