The Portuguese Senior Living Market

Population ageing is a main challenge and a massive opportunity in today’s society. The main challenge is often highlighted as being related to the social burden of the elderly when an increase in life expectancy coupled with a decreasing fertile rate puts pressure on the working population and on the sustainability of the social support system to tackle their needs. But there is more: the perception of an old person today is quite different from past images. People live longer and at 65 life expectancy in Portugal is almost 20 years with years of healthy life surpassing 7 years. This fact provides a massive opportunity as on one hand the elderly group hold a human capital, knowledge, expertise to an extent that has never existed before and on the other, may contribute very positively to society in different fields.

From a real estate perspective, the ageing population creates the chance to develop products that meet the needs, requirements and also expectations of the elderly which are vast and highly diversified varying across age, cultural backgrounds, income, health, personal preferences and care necessities. Having this said, the way forward relies in the development of a wide spectrum of accommodation from independent living to assisted living and care homes.

This report aims to set the background for the development of the senior living market in Portugal. It is mainly focused on Care Homes which fall into the ERPI category according to the existing legal framework with the analysis of the existing stock but also providing insight information on the demand fundamentals which are robust. The country has a shortage of purpose-built schemes for the elderly and JLL estimates the need to add 17,000 beds to the existing stock by 2025 to meet the World Health Organization (WHO) target cover ratio of 5% (beds per 100 inhabitants 65+).

As an investment product, the country has been gaining momentum and since 2018 a total of c. €185M have been allocated to his sector. The entrance of experienced international players over the last years with robust expansion plans mainly through forward funding or forward purchasing deals is creating additional opportunities for further institutional investment in the country in the coming years.

JLL expects this Senior Living report to be an important tool for the approach of this segment and the opportunities for its development in the future guaranteeing not only a better life quality for the population in the latter stage of life but also healthy investment products.