Healthcare systems and facilities continue to improve across the region with investors and operators introducing new trends and standards to improve and enhance the healthcare sector in the region. In Saudi Arabia, the healthcare market is growing thanks to the convergence of three factors; demand from a growing population base, an increasing elderly population and the rapid growth of the private insurance healthcare market.
Whilst viewed externally, the private healthcare sector offers lucrative opportunities. It also faces significant challenges; high capital entry cost, attracting and retaining quality medical staff and funding constraints for new entrants. Additionally, one of the biggest factors hindering the growth is availability of funds for capital expenditure mainly for the construction of hospitals. The opportunity therefore lies within unlocking existing value within the sector to support expansion programs or as alternative funding sources for new developments.
The REIT funds in the Kingdom can unlock current SAR 28 billion to SAR 32 billion property value from the private sector. Furthermore, REITs can play a role in growth of the healthcare market by providing much needed capital investment which is in the range of SAR 2.7 billion to SAR 8.5 billion to fund new hospitals by 2025.
Colliers International is working with several market players to assist them in their expansion plans either by expansion of existing brands or attracting international brands to the region. Colliers is also assisting number of market participants through traditional funding options, such as debt and equity, or emerging funding options, such as OpCo / PropCo, or a Joint Venture (JV) with an investor and REITs. For further inquiries, please contract Mansoor Ahmed, Director of Healthcare, Education & PPP in the Middle East and North Africa on firstname.lastname@example.org
or Imad Damrah, Managing Director of Colliers International KSA on email@example.com