Paris, the 12th of October 2025
The European nursing home sector is witnessing a seismic shift as major operators restructure their portfolios to optimize capital allocation and focus on operational excellence. The recent €111.2 million acquisition of 11 French nursing homes by Singapore-based Parkway Life REIT from DomusVi Group represents more than just another real estate transaction—it signals a fundamental transformation in how institutional investors view European senior care assets. 🌍
📊 The Transaction That’s Reshaping European Senior Care Real Estate
On October 22, 2024, Parkway Life REIT announced its maiden European acquisition, purchasing 11 premium nursing homes from DomusVi Group for €111.2 million. This strategic move marks the first time a major Asian REIT has entered the French EHPAD market, bringing international capital and expertise to Europe’s largest senior care market.
The acquired properties comprise 850 beds across 42,630 square meters of net lettable area, strategically located in six French regions: Bourgogne-Franche-Comté, Nouvelle-Aquitaine, Occitanie, Grand Est, Normandie, and Auvergne-Rhône-Alpes. Each facility will continue operating under DomusVi management through a 12-year sale-and-leaseback arrangement, ensuring operational continuity while providing the operator with immediate capital for growth initiatives. 💰
🎯 Key Transaction Highlights
📈 Key Takeaways in 30 Seconds
- Transaction Value: €111.2 million for 11 premium French nursing homes
- Yield Impact: Expected to increase Parkway Life REIT’s DPU by 1.4% on a pro forma basis
- Strategic Significance: First major Asian institutional investment in French EHPAD sector
🏗️ DomusVi’s Strategic Portfolio Optimization
DomusVi Group, Europe’s second-largest nursing home operator with over 600 facilities across Western Europe, has been systematically optimizing its real estate portfolio to focus resources on operational excellence and expansion. The company operates approximately 52,000 beds across France, Spain, Germany, and Latin America, making it a dominant force in the European senior care landscape.
This asset sale represents a calculated move by DomusVi to unlock capital while maintaining operational control through long-term lease agreements. The 12-year lease terms provide DomusVi with operational stability while transferring real estate risk to institutional investors better equipped to manage property-related challenges. 🔄
« The transaction aligns with DomusVi’s ongoing strategy of optimizing its real estate portfolio while maintaining its position as a leading European senior care operator, » according to the company’s official statement. This approach allows DomusVi to focus on what it does best—providing quality care services—while partnering with real estate specialists for property management.
🌐 International Capital Flows into European Senior Care
Parkway Life REIT’s entry into the French market reflects growing international interest in European nursing home assets. The Singapore-based REIT, which manages over S$2.4 billion in healthcare real estate across Asia-Pacific, sees Europe as a natural extension of its investment mandate given similar demographic trends and regulatory frameworks.
The acquisition was financed through a private placement raising approximately S$120 million, demonstrating strong investor appetite for diversified healthcare real estate exposure. This international capital injection brings several benefits to the European market:
- Enhanced Liquidity: International REITs provide new exit opportunities for European operators
- Professional Management: Specialized real estate management expertise from established healthcare REITs
- Capital Efficiency: Access to lower-cost capital through public market funding
- Best Practices Transfer: Cross-pollination of operational and investment strategies across markets
📈 Investment Implications for EHPAD Stakeholders
The DomusVi transaction provides valuable insights for various stakeholders in the French nursing home investment ecosystem:
🏦 For Institutional Investors
The successful completion of this transaction at attractive valuations (€111.2 million for assets independently valued at €115.4 million by Cushman & Wakefield) demonstrates that quality EHPAD assets can trade at reasonable multiples even in challenging market conditions. The 12-year lease terms with built-in escalations provide inflation protection and cash flow visibility that institutional investors value highly. 📊
Key investment metrics from the transaction:
- Price per bed: Approximately €130,800 per bed
- Price per square meter: Approximately €2,610 per sqm
- Lease term: 12 years with DomusVi as operator
- Geographic diversification: Six French regions
💼 For LMNP Investors
Individual investors utilizing the LMNP (Loueur Meublé Non Professionnel) structure can draw several lessons from this institutional transaction. The sale-and-leaseback model demonstrates the viability of separating real estate ownership from operations, a structure that LMNP investors already employ when purchasing individual EHPAD units.
The transaction validates several key LMNP investment principles:
- Operator Quality: DomusVi’s ability to attract international capital confirms the importance of partnering with established operators
- Long-term Leases: The 12-year lease term reflects institutional preference for extended commitment periods
- Geographic Diversification: The multi-region portfolio approach mirrors best practices for LMNP investors
🔍 Market Analysis: What This Means for European Senior Care Real Estate
The DomusVi-Parkway Life transaction occurs against a backdrop of significant demographic and economic trends reshaping European senior care real estate:
📊 Demographic Drivers
France faces an accelerating aging population, with citizens aged 65 and above increasing from 17% in 2009 to 22% in 2023. Projections indicate this demographic will reach 29% by 2070, creating sustained demand for senior care facilities. With only 600,000 nursing home beds available for over 6 million seniors aged 65+, supply constraints support long-term investment fundamentals. 👥
💰 Government Support Framework
France allocates approximately 32% of GDP to social security spending—the highest in the EU—with 44% dedicated to aged care services. This robust government support system reduces operational risk for nursing home operators and provides cash flow stability that attracts institutional investors. The Statutory Health Insurance (SHI) scheme covers 60-65% of nursing home costs, ensuring predictable revenue streams for operators and property owners.
🏗️ Supply-Side Constraints
The highly regulated French nursing home sector creates natural barriers to entry, with new authorizations subject to strict government controls. No new nursing home beds are expected to receive authorization until 2028, creating a supply-constrained environment that supports asset values and rental growth for existing facilities.
⚠️ Risks to Monitor
- Regulatory Changes: Potential modifications to government funding formulas or care standards
- Operator Risk: Dependence on DomusVi’s operational performance and financial stability
- Interest Rate Sensitivity: Impact of rising rates on asset valuations and refinancing costs
- Currency Exposure: EUR/SGD exchange rate fluctuations for international investors
🎯 Strategic Implications for Different Investor Types
🏢 For Large-Scale Investors
The transaction demonstrates that European nursing home assets can attract international institutional capital at scale. Investors with €50+ million investment capacity should consider:
- Portfolio Approach: Multi-asset acquisitions provide better diversification and operational efficiency
- Operator Partnerships: Long-term relationships with established operators reduce operational risk
- Professional Management: Engaging specialized healthcare real estate managers like PAREF Group
🏠 For Individual LMNP Investors
While individual investors cannot replicate institutional-scale transactions, several principles apply to LMNP investments:
- Operator Due Diligence: Focus on operators with institutional backing and long-term viability
- Lease Structure: Seek longer lease terms with built-in escalation clauses
- Location Strategy: Target facilities in regions with strong demographic trends and government support
💡 Practical Investment Considerations
📋 Quick Check Before Buying/Selling
- Operator Financial Health: Review operator’s financial statements and credit ratings
- Lease Terms: Ensure adequate lease duration and escalation mechanisms
- Regulatory Compliance: Verify all necessary authorizations and compliance status
- Market Position: Assess local competition and demographic trends
- Exit Strategy: Consider liquidity options and potential buyer universe
- Tax Optimization: Structure investment to maximize LMNP benefits and minimize tax exposure
🔮 Future Outlook: Consolidation and Internationalization
The DomusVi transaction likely represents the beginning of increased international investment in European nursing home real estate. Several trends support continued consolidation:
- Capital Requirements: Aging infrastructure requires significant investment that favors institutional ownership
- Operational Efficiency: Larger portfolios enable economies of scale in management and maintenance
- Regulatory Compliance: Increasing regulatory requirements favor professional real estate management
- ESG Considerations: Institutional investors bring enhanced focus on environmental and social governance
For investors considering nursing home real estate, this transaction validates the sector’s attractiveness to sophisticated institutional capital while highlighting the importance of professional management and long-term operational partnerships. 🚀
🎯 Conclusion: A New Chapter for European Senior Care Investment
The DomusVi-Parkway Life REIT transaction marks a watershed moment for European nursing home real estate, demonstrating that quality assets can attract international institutional capital even in challenging market conditions. The successful completion of this €111.2 million transaction provides a roadmap for other operators seeking to optimize their real estate portfolios while maintaining operational control.
For investors, the transaction validates key investment principles: focus on quality operators, seek long-term lease commitments, and prioritize assets in markets with strong demographic fundamentals and government support. Whether investing through LMNP structures or considering larger portfolio acquisitions, the lessons from this landmark transaction provide valuable guidance for navigating Europe’s evolving senior care real estate landscape.
As demographic trends continue to drive demand for senior care facilities across Europe, transactions like DomusVi’s asset sale to Parkway Life REIT will likely become more common, creating new opportunities for investors at all scales to participate in this essential and growing sector. 🌟
💼 Ready to explore nursing home investment opportunities? Whether you’re considering your first LMNP investment or evaluating a portfolio acquisition, professional guidance can help you navigate this complex but rewarding sector. Contact EHPAD INVEST for a free consultation and market analysis tailored to your investment objectives.
📚 Sources
- Parkway Life REIT Acquisition Announcement, October 22, 2024
- DomusVi Group Press Release, December 20, 2024
- Cushman & Wakefield Valuation Report, September 30, 2024
- INSEE Demographic Statistics, 2024
- European Central Bank Financial Stability Review, November 2024
- Candesic Healthcare Real Estate Market Analysis, 2024