Elderly care accounted for over two-thirds of transactions (68%) with private hospitals making up 29% and adult specialist care, primary care and childcare accounting for the remaining 3%.
Julian Evans, global head of healthcare at Knight Frank said: ‘Healthcare's fundamental drivers, such as demographics, long-term income, and ESG credentials, have and continue to present an undeniable investment case. On this basis, the overall outlook for the healthcare sector is optimistic and we have already seen last year's positive sentiment filter through into 2025 with the completion of large portfolio as well as M&A deals.'
Overseas capital accounted for 52.5% of demand in 2024, with US-based REITs and private equity groups accounting for 66% of global flows into UK healthcare, compared to 34% from the EU.
Knight Frank said there was healthy interested in both small and large portfolios reflecting market entry and possible consolidation, suggesting healthcare sector may finally be at a point of maturity to shift away from being an alternative investment class.
Portfolio deals accounted for 85% of transactions, compared to 52% in 2023, with well-capitalised groups such as Welltower and Omega active and looking to build scale.
Alongside company acquisitions, sale and leaseback deal structures also played a significant role in 2024's transaction volumes as operators looked to exit the sector or release capital, Knight Frank commented.