More than £12bn of capital was deployed into UK healthcare real estate in 2025, the highest annual total on record, according to new data from Savills.
Care home investment activity was fuelled predominately by US REITs, supported by their lower cost of capital and ability to utilise RIDEA (management contract) structures. Last year, US REIT Welltower deployed more than £7bn in the sector, including one of the largest care home transactions ever with its acquisition of Barchester Healthcare for £5.2bn.
Savills expects the UK to remain Europe’s most attractive care home real estate market in 2026, supported by a large and resilient private market, strong underlying demand and limited new supply entering the market.
There was also significant activity in the hospital segment last year, including the sale of Practice Plus Group’s secondary care business to Narayana Health for circa £189m in October.
Caryn Donahue, head of healthcare and senior housing at Savills, said: “The UK remains the primary focus for US capital and we also expect UK domiciled healthcare REITs to become more active as macroeconomic conditions improve. The scale and speed of US REIT deployment in 2025 has cemented the UK’s position as the leading destination for cross border capital in the care home sector, and we anticipate strong competition for high quality assets and portfolios again in 2026.”
Tom Atherton, strategy and market intelligence manager at Savills, added: “We are seeing growing interest and opportunity across the healthcare spectrum. Care homes, hospitals, and primary care assets all present compelling investment prospects for 2026, driven by strong demand for services and continued constraints on new supply.”
