How European real estate investors and care operators can build profitably and sustainably — interview with Alberto Fernandez, Healthcare Activos
This interview is featured as one of several case studies in HBI’s 2026 Healthcare Property Special Report, which will soon be published.
Healthcare Activos is a Spanish specialist healthcare REIT investing in nursing homes, hospitals, mental health clinics and rehab centres across Europe. Currently it has 84 assets under management, worth over €1.3 billion.
Healthcare Activos has two distinguishing features which set it apart from the other major healthcare real estate investors in Europe. One is that they prefer to buy individual properties rather than portfolios, as they prefer to pick and choose the best assets based on their fundamentals (catchment area, design, effort rate, operator, lease agreement) on a case-by-case basis. Secondly, and relatedly, they have a strong focus on new builds, which they design themselves.
Fernandez says Healthcare Activos is the only real estate investor doing new builds across Europe at scale. Last year they completed seven, and signed five new projects, across Ireland, France, Italy, and Spain. Fernandez says the plan is to do several more in 2026 and 2027, in France, Germany, Italy, Spain, Portugal and Ireland.
Alberto Fernandez, Co-CEO, Healthcare Activos
“Greenfields are the best type of asset we can own long term,” Alberto Fernandez, Co-CEO, says. “First of all, we are selecting the catchment area. Secondly, we design the building, tailored to the specific catchment area; that’s fundamental. And then we find the right operator. If the right operator does not fulfill the capabilities, experience, and have the right long-term view for this type of service in this type of catchment area, then it’s the wrong operator for this specific asset.”
Selecting the right catchment area is critical because only homes built in the right areas will be profitable long-term. “In Germany there was an issue that many of the homes that were built in recent years were done by real estate developers, so it was a very supply-driven market and many were built in the middle of nowhere. These homes are of course now suffering with low occupancy or prices well below expectations, ultimately resulting in unsustainable effort rates. But if you have a good location with a good catchment area, a good design and a good operator, they will be full sooner or later with the adequate pricing.”
Healthcare Activos even goes so far as to put together their own theoretical business plan for the operator who would be occupying the building based on the catchment area, design, local market dynamics, regulation, etc to make sure it will be sufficiently profitable and that they can charge a rent of about 50% of EBITDAR sustainably. “In that discussion, yield is not what matters, it’s about operator fundamentals and the level of rent. We want to set the right conservative rent, so that the operator’s effort rate is not too high and they will be able to pay it over a long period of time. The effort rate is probably the most important KPI for the long-term sustainability of the operations whilst maintaining the building in an optimal state. And that is fundamental to guarantee our conservative long-term inflation-linked returns,” he says.
Then comes the actual building process, which is something most European investors and operators have struggled with over the past few years. “Everyone complains that construction costs have gone too high and so they can’t get an attractive enough yield for it to be worth building. We believe this is the wrong way to look at it: it’s only true if you have a short-term view, you don’t have a good design and the project is not worked enough.”
According to Fernandez, Healthcare Activos completed all seven of the buildings they built in 2025 at a final cost that came within a 1.5% margin of the original projected cost despite the significant inflation in recent years. “This is unheard of,” he says.
The reason they’re able to do this, he says, is that Healthcare Activos are real estate investors with a uniquely operator-like mindset, as many of the people on the management team are former operators. He estimates that including their former experience as operators, the team has collectively built more than 150 buildings over the past 25 years.
This means they’re able to: a) design buildings with operational efficiency in mind, and b) be flexible in the face of rising construction costs, so that when cost inflation does occur they can see if there are alternative materials they can use that won’t reduce the quality of the building, for example.
The key, he says, is not being an “expert in construction”, but being an expert in designing shared buildings for the purpose of care. “All our competition, including the real estate developers, are not experts in designing healthcare buildings, so for them the numbers don’t add up,” he says.
For Healthcare Activos, the most important part of the design is building the complex in accordance with their ‘sectorisation’ concept, i.e. having the building divided into units of 15–20 rooms with each unit catering for residents with different types of need. “Sectorisation of the building is what will guarantee long-term sustainability of the asset. It will improve quality of care for the residents while providing flexibility to the operator regarding future demands of the buildings with independent units depending on the care specialties: the operator can have different independent sectors with different medical specialties in the same building, such as mental health, palliative care, post-acute, physical dependency, neuro-rehabilitation, etc. These higher acuity sectors can provide enhanced quality of life to the residents compared to traditional acute care beds at a cost that is 75% lower for the payors.”
The layout isn’t the only important thing to consider. The building materials matter as well: “When you’ve been managing homes for 25 years you know where you need to spend money and where you don’t need to spend money. For example, in one of the latest greenfields we signed in Italy, we managed to reduce the original budget prepared by the operator from €24 million to €17 million while improving the design of the building, resulting in better profitability for the operator and ultimately better care for the patients.”
Fernandez says that this is why Healthcare Activos is currently having a number of discussions with the biggest operators in Europe regarding new projects.
“We are long-term minded and we have a long-term approach to all our investments, so we want to make sure that it’s properly built. And the best way to guarantee it’s properly built is to build it yourself.”
Fernandez believes that focusing on greenfields is the only solution for the demographic tsunami that Europe is facing in the coming decades:
“We not only need to build 1.6 million new beds in the coming 10–15 years with an investment value in excess of €200 billion, but we need to make sure that the new buildings are sustainable long term from a cost perspective while providing superior quality of care. Otherwise, our societies will not be able to afford the exponential increase in dependency costs. It is not about spending more as our governments will not be able to afford it, it is about spending better!”
We would welcome your thoughts on this story. Email your views to Martin De Benito Gellner or call 0207 183 3779.
