A New Way To Invest In Commercial Property
Discover the benefits of pooling resources to access institutional- grade property in a Single Asset Fund.
In June 2025, private equity firms KKR and Stonepeak Partners finalised a £1.7 billion cash acquisition of Assura, a major UK-based NHS property landlord. This offer represented a 39% premium over Assura’s share price on February 13, 2025, the day before the initial approach [1]. Assura operates over 600 healthcare facilities valued at more than £3 billion, serving the UK’s National Health Service.
This high-profile acquisition demonstrates that global institutional investors view UK healthcare property as significantly undervalued, particularly assets with NHS tenants. The substantial premium paid underscores the perceived stability and attractiveness of UK healthcare properties, even amid economic uncertainties.
“The deal is part of a trend of British businesses being bought out and taken private by overseas firms attracted by cheap valuations,” reported Reuters, highlighting how this major transaction validates UK healthcare property as a resilient, undervalued asset class [1]. This institutional surge is expected to accelerate over the next 2-5 years, intensifying competition for NHS-tenanted assets and gradually elevating valuations above net asset value.
For high net worth individuals seeking to safeguard wealth in uncertain times, this institutional validation raises an important question: if billion-dollar private equity firms are aggressively targeting NHS property assets, what opportunities exist for individual investors to access similar benefits?
The UK government’s decision to abolish the non-domiciled (non-dom) tax status, effective April 2025, is projected to have significant economic repercussions. The Adam Smith Institute estimates that this policy change could result in a £6.5 billion loss to the UK economy by 2035, with a potential exodus of 5,800 non-doms, leading to a £600 million annual GDP loss by 2030 [2].
Additionally, reports indicate that 10,800 millionaires left the UK in 2024, a 157% increase from 2023, marking the largest recorded exodus of millionaires [3]. This outflow presents both challenges and opportunities in the UK investment market. While many HNWIs are relocating capital abroad, those maintaining UK exposure are increasingly selective, prioritising tax-efficient vehicles with stable returns.
Healthcare property’s essential nature and long-term NHS leases offer precisely the kind of inflation-protected income stream that can offset some tax disadvantages. The sector’s resilience, demonstrated by the KKR-Stonepeak acquisition, provides compelling reasons for wealth preservation within the UK despite changing tax landscapes.
The acquisition of Assura by KKR and Stonepeak at a 39% premium over its pre-bid share price highlights a trend of undervaluation in UK healthcare properties. Despite owning over 600 healthcare facilities valued at more than £3 billion, Assura’s market valuation prior to the acquisition suggested a disconnect between asset value and market perception [1].
This valuation gap presents a strategic entry point for investors, particularly as institutional buyers are willing to pay substantial premiums to secure these assets. The undervaluation presents opportunities for investors to acquire assets below intrinsic value, with potential for significant capital appreciation as market perceptions adjust.
For high net worth individuals, the challenge has traditionally been accessing institutional-grade healthcare properties without committing enormous capital. The minimum investment thresholds for direct property ownership often exceed £1 million for quality assets, placing them beyond the reach of all but the wealthiest investors or requiring significant concentration risk.
“UHNW investors are taking a sophisticated approach to constructing portfolios, seeking out diversification across strategy, geography, vintage and fund size,” notes Adam Harrison, Head of Strategic Partnerships at Titanbay [4]. This diversification approach is particularly relevant for healthcare property investments, which can provide both geographical and sector-specific diversification benefits.
"'Healthcare real estate is characterized by stable demand. People will always need healthcare services, regardless of economic conditions.' - HBRE"
Despite growing economic optimism in the UK, high net worth individuals remain concerned about inflation’s effect on their portfolios and express wariness about equity market volatility. These persistent concerns highlight the need for defensive assets with inflation-protection characteristics.
Healthcare property with long-term NHS leases typically includes inflation-linked rent reviews, providing natural hedging against rising prices. NHS leases are structured with Weighted Average Unexpired Lease Terms (WAULT) often exceeding 15 years, significantly longer than typical commercial leases. These leases frequently include upward-only rent reviews linked to the Retail Price Index (RPI) or Consumer Price Index (CPI), providing built-in inflation protection that is particularly valuable in the current economic climate.
The covenant strength of NHS tenants is exceptional, backed effectively by the UK government, making them among the most secure commercial tenants available. This combination of long lease terms, inflation-linked reviews, and government-backed covenant strength creates a defensive investment profile that few other commercial property sectors can match.
Recent performance data from the healthcare property sector underscores this stability. According to Housemark’s annual report covering April 2025 data, the social housing sector has seen significant improvements in arrears performance and void turnaround times. The national median arrears figure stood at 2.56%, lower than many first-quarter results from the 2010s, and 68% of landlords reported lower arrears in April 2025 than they did in April 2024 [5].
The report also identified sustained improvement in voids and lettings performance, with average re-let times falling by 17% to 41 days and the proportion of homes vacant and available to let dropped to 0.46% [5]. This data demonstrates the resilience and stability of healthcare and social housing assets even during periods of economic uncertainty.
The privatisation of major NHS landlords like Assura highlights how institutional investors are consolidating control of premium healthcare assets. This trend potentially limits direct ownership opportunities for individual investors, as institutional interest may drive up valuations, making it more challenging for smaller investors to enter the market.
The deal is part of a broader pattern of British businesses being bought out and taken private by overseas firms attracted by cheap valuations [1]. For individual investors, this creates both a challenge and an opportunity—while institutional consolidation may reduce the availability of publicly traded healthcare property investments, it also validates the underlying value proposition of the asset class.
Innovative solutions to this accessibility challenge are emerging. SIRE Capital Partners has developed a solution through their Single Asset Funds (SAFs). These investment vehicles create a democratised pathway for high net worth individuals to access similar high-quality healthcare properties with the same tenant covenant strength as those being acquired by private equity giants, but with investment thresholds starting at £100,000 rather than billions.
Single Asset Funds enable like-minded investors to collectively invest in individual commercial properties, allowing access to larger, high-grade assets that might be unaffordable individually, thereby improving income quality and reducing risk exposure [6].
Despite growing economic optimism, HNWIs remain cautious about investment structures, increasingly favouring vehicles that offer greater transparency and control. Single Asset Funds provide direct visibility into specific healthcare properties rather than diversified portfolios where performance can be obscured.
This governance clarity becomes particularly valuable during economic transitions when investors seek to understand exactly how their assets are performing and what specific risks they face. For example, a Single Asset Fund focused on a specific NHS medical centre allows investors to clearly understand the tenant covenant, lease terms, and property condition.
Unlike traditional REITs, which may have complex capital structures and significant debt levels, Single Asset Funds typically offer cleaner capital structures with more transparent governance. Each SAF is established to acquire a specific commercial property, offering investors transparency as they know exactly which asset they are investing in, contrasting with “blind pool” funds where future acquisitions are unknown [6].
The structure also offers advantages in terms of regulatory compliance. SAFs fall under the UK Financial Conduct Authority’s (FCA) definition of an Alternative Investment Fund, ensuring adherence to strict rules regarding the promotion of investment products and the handling of client money [6].
“There is a £50B funding gap, and the private sector is going to have to step in and fill a lot of that.” - Anne Copeland
Environmental, Social, and Governance (ESG) factors are increasingly important in investment decisions, particularly for younger investors who will inherit significant wealth in the coming decades. Healthcare property investments offer unique ESG advantages that align with evolving investor preferences.
Recent developments in the healthcare property sector demonstrate this growing focus on sustainability. Community Healthcare Trust Incorporated recently released its second Corporate Sustainability Report, highlighting significant progress in environmental and social initiatives across its corporate offices and real estate portfolio. “The report is a reflection of our progress and a reaffirmation of our commitment to transparency and continuous improvement,” stated CEO David H. Dupuy [7].
For healthcare property specifically, ESG considerations include energy efficiency improvements in healthcare facilities, reduction of carbon footprint, sustainable building practices, enhancing community access to healthcare services, and transparent reporting on property performance. These ESG factors are particularly relevant for next-generation investors who often prioritize sustainability alongside financial returns.
Recent data reveals significant challenges in the current NHS property estate that create both risks and opportunities for investors. The Public Accounts committee reported that the maintenance backlog is greater than the official £49bn estimate, with over 4,100 prison cells closed since 2010 due to poor maintenance, and in the NHS an average of 5,400 clinical service incidents each year due to property and infrastructure failures [8].
The committee warned that government properties may be at further risk from issues yet to emerge, such as the presence of reinforced autoclaved aerated concrete (RAAC) and asbestos across the government estate. It also found a shortage of skilled professionals across departments and a lack of information on managing and maintaining the property estate [8].
This substantial infrastructure deficit suggests a significant need for private investment to address these challenges, potentially creating opportunities for investors while supporting essential public services. However, investors must carefully evaluate the condition and maintenance requirements of any healthcare properties they consider.
Looking beyond current economic uncertainty, demographic trends provide powerful tailwinds for UK healthcare property. The UK’s aging population will drive increased healthcare demand, creating structural underpinning for healthcare property values that transcends short-term economic cycles.
This demographic tailwind provides a structural underpinning for healthcare property values that transcends short-term economic cycles, making it particularly attractive for wealth preservation strategies. The anticipated growth in healthcare demand, combined with the essential nature of healthcare services, creates a compelling long-term investment case.
The KKR-Stonepeak acquisition of Assura represents institutional validation of this thesis. By following the smart money into healthcare property through appropriately structured vehicles like Single Asset Funds, high net worth individuals can participate in this resilient sector while maintaining the liquidity, control, and diversification benefits that direct institutional ownership cannot provide.
How might investors best evaluate the specific healthcare properties that offer the strongest combination of tenant covenant strength and inflation protection? And what due diligence steps should be prioritized when considering co-investment opportunities in this specialized sector?
We view the significant institutional investment in UK healthcare property as a powerful endorsement of an asset class we have long championed for its inherent stability and secure income potential. The current economic climate, coupled with shifts in the tax environment, underscores the critical need for high net worth individuals to identify reliable UK-based assets offering robust, inflation-protected returns. We believe that high-quality healthcare properties, underpinned by the exceptional covenant strength of NHS tenants and featuring long leases with inflation-linked reviews, represent a cornerstone for wealth preservation and steady income generation in uncertain times. This sector’s resilience and essential nature make it a compelling component of a sophisticated investment approach.
We understand the traditional barriers preventing individual investors from accessing these institutional-grade assets. This is precisely why we developed our Single Asset Fund structure; it provides a direct, transparent pathway for investors to participate in specific, high-quality healthcare properties typically reserved for much larger capital pools. Evaluating opportunities in this specialised sector requires meticulous due diligence, focusing intently on the specific lease terms, the property’s condition, and the strength of the tenant covenant. We are confident that the structural demand driven by demographic shifts and the ongoing need for infrastructure investment will continue to support the long-term value proposition of well-selected healthcare real estate assets.
Patrick Ryan is a Principal and Co-founder at SIRE Capital Partners, working on Deal Origination and Asset Management. Patrick has spent 20 years in the property sector in London. His first foray into the sector was in 2003 when he co-founded a mezzanine finance business that focused on lending to property developers in and around London. Following this he headed up SIRE Properties, a healthcare focused asset management firm. Patrick has now co-founded SIRE Capital Partners that has expanded on his healthcare asset management focus to take in broader services to include brokerage and capital advisory.
[1] KKR tables best final $2.3 billion offer to buy UK’s Assura, Reuters
[2] Non-dom tax abolition could cost UK £6.5bn by 2035, Adam Smith Institute
[3] Understanding the abolition of non-dom status, OB Private
[4] Ultra-high-net-worth investors turn to private equity to enhance long-term portfolio returns, Campden Wealth
[5] Housemark: Arrears and voids performance hit multi-year highs, Scottish Housing News
[6] Single Asset Funds, SIRE Capital Partners
[7] Community Healthcare Trust Releases Game-Changing Sustainability Report, Stock Titan
[8] The pictures that show why the UK has run up a ‘£49bn repair bill’, iNews
Discover the benefits of pooling resources to access institutional- grade property in a Single Asset Fund.
The UK healthcare market is rapidly evolving, presenting unique investment opportunities in real estate.
A Single Asset Fund is an arrangement whereby like-minded investors collectively allocate funds to invest in a commercial property.
Healthcare property offers stable yields amid economic uncertainty. Private equity’s surge validates its potential, yet poses competition. Opt for transparent, tax-efficient structures to secure attractive, risk-adjusted returns.
Healthcare property syndication offers transparency, inflation protection, and reliable income, addressing high-net-worth investors’ concerns about market volatility and traditional AIF limitations. NHS-backed leases provide a secure, inflation-linked investment.
UK healthcare properties offer stable, inflation-protected returns amid residential market decline. High-net-worth investors find refuge in this resilient sector, driven by demographic trends and international capital influx.
UK healthcare properties offer stable, inflation-protected income. With high occupancy rates and tenant quality, they provide secure returns amid economic uncertainty. Explore strategic investment opportunities in this resilient sector.
UK care home fees surge, challenging wealth preservation. Healthcare Single Asset Funds offer inflation protection and strategic advantages over traditional property, ensuring resilient portfolios amidst rising costs.
AI transforms UK commercial property investments, offering HNWIs unprecedented access to prime assets. Single Asset Funds provide transparency, tax efficiency, and inflation protection, enhancing wealth preservation amidst economic uncertainties.
- Khalid Hussain (Clinical Director at Todays Dental Group)
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