UK GP Medical Centre Property Market: A Growing Market for Investors
The UK GP medical centre property market is a niche sector that offers attractive opportunities for investors who are looking for stable, long-term returns. GP medical centres are primary care facilities that provide a range of health services to local communities, such as general practice, pharmacy, dentistry, physiotherapy, and minor surgery. They are typically leased to the NHS or GP partnerships on long-term contracts, with rent reviews linked to inflation or market value.
The demand for GP medical centres is expected to increase in the future, as the population ages and requires more health care services. The NHS Long Term Plan, published in 2019, also emphasises the need for more investment in primary care infrastructure, to improve access, quality, and efficiency of care.
However, the supply of GP medical centres is limited, as the development of new premises is often constrained by planning, funding, and regulatory challenges. This creates a gap between demand and supply, which drives up the value and rental growth of existing GP medical centres. Moreover, the GP medical centre property market is relatively resilient to economic downturns, as the income stream is backed by the government and the demand for health care is non-cyclical.
According to agents, there are over 8,000 GP medical centres in the UK, with a total value of around £12 billion. As a result, GP medical centres have become an attractive asset class for investors who are looking for stable, long-term returns with low risk. According to Savills, the average yield for GP medical centres in the UK was 4.75% in 2020, compared to 5.25% for offices and 6.25% for industrial properties.
The GP medical centre property market also offers diversification benefits, as it has a low correlation with other commercial property sectors.
There are various ways for investors to access the GP medical centre property market, such as buying individual properties, investing in funds or trusts, or partnering with developers or operators.
To discuss the GP Medical Centre property market, please talk to us. You can contact our Valuations team or Commercial Agency team.
