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DISCOVERING TRUE VALUES

 

Sustainable investment opportunity with excellent return expectations

 

Valartis Healthcare Fund invests in established senior housing facilities and nursing homes and develops modern, high-quality senior living facilities in Germany.

Sustainability is our top priority, and our investment decisions are always aligned with the UN’s SGDs. Our goal is to create an attractive investment return with a social impact. We partner up with trustworthy and reliable operators for senior and nursing living to provide dedicated and reliable services for our residents and their families. 

Long-term lease agreements with the operators, professional asset- and property management as well as long-term financing with fixed interest rates ensure long-term capital preservation and generate a stable, regular, and risk-adjusted return for our shareholders.

The fund is led by an experienced management team with great industry knowledge and excellent track record.

News

April 2023

Annual General Meeting
On 28 April 2023, Valartis German Residential Health Care SICAV-FIS (the “Company”) held its Annual General Meeting in Luxembourg.

The shareholders approved to grant full discharge to the Directors of the Company with respect to the performance of their duties for the period starting on 1 January 2022 and ending 31 December 2022 and re-appointed the directors Mr. Fernand Sassel, Mr. Gerald Scheweder and Mr. Gustav Stenbolt for a period of three years until the ordinary annual general meeting in 2026.

In addition, the shareholders approved to pay a dividend of EUR 60.00 per share which represents 6.0% of the nominal capital per share.  The pament will be done on 5 July 2023.

MARKET DEVELOPMENT

Significant increase of elderly population in Germany drives substantially need for care services

Increasing life expectancy, coupled with low birth rates in recent decades, has contributed to a demographic shift in Germany. The share of people aged 85+ increased significantly to 2.4 mln (1999: 1.2 mln) and will experience further strong growth with entry of baby boomers.

The demographic shift is more advanced in the “new” federal states (informally “East Germany”) and peripheral regions due to the birth slump after reunification and rural depopulation but supply of nursing care facilities concentrates on cities with high centrality ratings and high number of inhabitants compared to the more sparsely populated surrounding area.

The shift in age structure, individualisation and dissolution of family structures resulting in increasing dependence on professional care services and care facilities. Today, 4.1 mln (1999: 2.0 mln) people are care dependent, of which 20% live in nursing homes. And the figure of care dependent people is very likely to exceed 5 mln by 2030.

Investments of EUR 150+bn are needed to cover demand for senior housing facilities

A large number of existing nursing homes are ageing and have correspondingly high maintenance backlogs. Although, the investment volume for healthcare properties in 2020 rose by 68% to almost EUR 4bn with nursing homes being the most dominant sub asset class (EUR 2.7bn), the offering does not even begin to cover the demand.

Assuming constant share of care dependency and inpatient care rates, approx. 300k new stationary care places are needed by 2030 amounting to an investment volume of EUR 70bn. In addition, there is a lack of sufficient alternative forms of nursing homes like modern neighbourhood concepts or assisted living communities with barrier-free apartments, appropriate for those requiring care. According to the Federal Ministry, 2.9 mln barrier free apartments are needed adding around EUR 90bn to the required investment volume.

In Germany, the refinancing of care services is covered by social insurance system. The entire German population or more than 80mln persons are insured by the care insurance system. The care insurance covers approx. 50 percent of the individual costs of a resident in a nursing home or assisted living facility. Private insurances, personal wealth, or social welfare bear the remaining costs. Consequently, the operators’ default risks are very low and as a result the same is valid for the property owners.