European Healthcare Market Dynamics

• European healthcare investment totalled €13.9bn in Q4 2025, up 349% year-on-year and 258% on the five-year average. The growth was primarily driven by several €500m+ UK entity care home transactions, which represented 77% of quarterly volumes. As a result, care home investment rose 356% year-on-year and 351% against the five-year average, accounting for 72% of the total. Investment in clinics, special purpose facilities and senior living also increased  year-on-year and on the five-year average, while hospital investment fell 17% year-on-year and 45% below the five-year average.
• US-listed Welltower deployed £7.6bn (€8.7bn) into the UK market, including the £5.2bn (€5.9bn) purchase of Barchester Healthcare comprising 16,560 care home beds. These transactions follow several other entity deals, and together with the anticipated merger of Aedifica and Cofinimmo signal further consolidation in Europe's healthcare market. Entity deal volumes reached €11.1bn in Q4 and rose more than tenfold year-on-year. Standing and forward investment in Q4 also rebounded year-on-year, up 36% and 25% respectively, but have not yet recovered to pre-2022 levels.
• The average blended European care home yield remained at 5.20% for the third consecutive quarter, just one basis point higher than a year ago. Market stability and high activity will continue to support large entity and portfolio deals, with momentum expected to continue into H1 2026. Occupancy rates are improving, but rising staffing costs are again putting pressure on operating margins.

European healthcare attracted a record €20.9bn in investment in 2025, a rise of 142% year-on-year and 75% above the five-year average. Entity deals formed €13.4bn, 64% of the annual total. The UK accounted for 90% of entity transactions, driven by Welltower's care home acquisitions spree and PHP's purchase of Assura. Excluding these deals, direct investment totalled €7.6bn, a 16% increase on the previous year.

What are the key transactions in each market and who do they involve? See the deals and key players influencing this growing market.

How do these compare to other sectors? Understand pricing levels across mature and growing markets.

Compare prime net investment yields for care homes across Europe in the following visualisation. Prime yields relate to well-located, modern quality stock, let on long-term institutional leases to high quality operators.

What is the relative scale and nature of demand across Europe?

Rising elderly populations and growing healthcare expenditure are both core demand drivers for healthcare services and healthcare real estate, including long-term residential care facilities. Explore which markets have the strongest fundamentals using the map below. Click on a country to see more details relating to population and health expenditure.