Our website uses cookies to improve your experience. Click here to see our Cookie Policy.


News archive

September 2019 June 2019 April 2019 March 2019 January 2019

Product bulletin archive

16 October 2019 18 September 2019 21 August 2019 24 July 2019 26 June 2019
hdm magazine digital edition - September 2019

Media information

hdm media pack download total audience coverage

mental health and dementia facilities magazine (mhdf)

mental health and dementia facilities magazine (mhdf)

Total Audience Coverage

Total Audience Coverage

Our T.A.C packages offer maximum coverage with
on-the-page advertising,
stand-alone e-mail broadcasts, monthly bulletins and web site promotions.


healthcare buildings forum

healthcare buildings forum


mental health & dementia facilities forum

mental health & dementia
facilities forum

News archive - September 2017

Healthcare construction weathers the storm

Healthcare construction weathers the storm

The healthcare construction market has so far managed to keep its head above water in the wake of Brexit, the shock outcome of the recent General Election, and continuing downward pressure on capital budgets.

According to CBRE’s latest market review, investment activity picked up in the early months of this year following a relatively-subdued 2016.

And its researchers expect investment volumes in the first half of 2017 to top £700m, which is not far off the total recorded for the whole of last year.

The wider asset-backed healthcare market is being more-consistently buoyant thanks to some major deals, including Bupa’s purchase of Oasis Dental and Acadia’s acquisition of Priory.

The social care construction market also continues to provide further opportunities, with notable transactions this year including the acquisition by Impact Healthcare REIT of a portfolio of 56 care homes for £150m; and St Cloud Care’s acquisition of LRH Homes, which had a portfolio of 13 homes in London and the South East, for a price reportedly in excess of £70m.

Primary care investment

Tom Morgan, CBRE senior director of healthcare advisory, added: “Health and social care has proven itself to be a dynamic sector over the past 10 years and investors are learning to underwrite different business models and price operational risk alongside real estate and tenant credit risk.”

This optimism is echoed in the latest AMA Research report - Healthcare Construction Market Report - UK 2017-2021 Analysis - which expects steady, if moderate, growth in healthcare construction output, with annual rates of growth of 3-5% currently forecast to 2021 as work on small hospital projects is boosted by privately-funded projects under the new PF2 framework.

“The key construction opportunities in the healthcare sector are likely to be in the primary care sector and this may entail further opportunities for the development of hub facilities and integrated GP premises; while, in the acute and secondary sector, much of the medium term is expected to lie in refurbishment and extensions,” said AMA director, Keith Taylor.

“Contractors will also be interested to see how new procurement routes and private finance initiatives, including ProCure22, will be used to procure work in the health sector in 2017/18 and beyond, with the expiration of the Express LIFT framework and future options for health PPPs being explored.”

He added that, as a result of GP-led commissioning and financial constraints, the procurement of services to the NHS, including construction, are increasingly looking towards partnerships with the private sector.

The report states: “Future prospects look relatively bright, with the Government having announced a forward pipeline of around £5.7billion worth of capital projects in the healthcare sector between now and 2020 and beyond.

“This includes nearly 600 individual health projects under almost 100 schemes, which are mainly spread across the English regions, of which there are around 10 large NHS-led capital programmes, in addition to smaller works and capital programmes procured via the Procure 21/Procure21+ frameworks.”

Current Barbour ABI figures show around 60 currently-confirmed projects across the medical and healthcare; surgeries and medical centres; private hospitals; secure hospitals; and hospices, and nursing and psychiatric home sectors.

In the pipeline

A further 100 projects are at the outline planning stage and will be coming through in the next couple of years, although funding remains a problem for several of these and has seen a number put on hold.

And 150 projects are at the pre-tender stage, showing a relatively-healthy pipeline for the future.

There are also 5,000 mixed-use residential projects which include an element of elderly care accommodation, a huge proportion with specialist dementia care units.

But there are some signs that the recent General Election, continuing Brexit talks, and dwindling budgets may be putting some downward pressure on this pipeline.

A recent Barbour ABI report shows medical and healthcare projects make up just 1% of the overall construction activity in the UK.

It states: “The levels of funding for the NHS have been a major area of focus for the main political parties.

“Our report highlights the scale of the issue facing healthcare if the construction figures are anything to go by.

“After a poor year in 2016 for medical and health construction, April certainly showed no sign of an improvement, with figures showing the sector generated only £84m worth of construction contracts.

“According to Barbour ABI data, this was the lowest figure for almost five years and is way below its most-recent peak last January of £319m.”



To advertise in this space, click here to email Leslie de Hoog