Whether retail, offices or healthcare, all sectors face their own challenges but opportunities do still exist. Next year will be a big year for the healthcare sector, which has, I'm sure, been identified by the wider property market.
The changes to healthcare provision in the UK have been discussed and debated significantly over the last couple of years, but it isn't until April 2013 that important parts of the Health & Social Care Act will take effect, and major changes will be implemented. The new role of GPs caused the most contention, with the creation of Clinical Commissioning Groups resulting in local healthcare provision and procurement being led by GPs.
April 2013 is also the deadline imposed by Care Quality Commission legislation that requires GP premises to be compliant with certain standards. To give an indication of scale, there are around 7,500 primary care premises in England, of which an estimated 66% are deemed unfit to meet future demands and will fail to comply with the CQC guidelines.
So, combined, the CQC legislation and the new, wider role of GPs will have a significant impact on healthcare property. Put simply, GPs will be required to deliver more services to more people but are faced with the prospect of inadequate primary care premises.
Furthermore, this modern, more ambitious delivery of care to patients is likely to result in the extension of primary care teams, with the ability to offer new expertise plus diagnostics and social care. So, if GPs are to develop their new role as clinical commissioners during 2013, facilities have to be improved – delivering small, isolated services in converted premises will no longer be adequate.
While we won't suddenly begin to see mini hospitals popping up across the North West, premises will need to be improved, whether this means undertaking small-scale improvements or the creation of state-of-the-art medical centres.
The sector is also likely to continue attracting investment – prime office and retail space will remain in short supply during 2013 and little development is likely to take place, so investors will be seeking alternative opportunities that will provide them with a safe haven for their funds. New generation, state of the art healthcare properties will provide investors with a solid investment opportunity.
- Andrew Darke, managing director of property, Assura Group, Warrington