KHALEEJ TIMES, Wednesday, Sep 13, 2017 | Zul Hijjah 22, 1438
Dubai needs additional 1,000 hospital beds by 2022
Dubai would need at least 1,000 hospital beds or seven new hospitals over the
next five years to keep pace with the growing population and meet global
standards in the healthcare sector, said Craig Plumb, head of research, Mena -
JLL (Jones Lang LaSalle) at Cityscape Global.
JLL released a report called 'Healthy Returns', highlighting the opportunities
for investors and other real estate players in the healthcare market across
Middle East and North Africa (Mena) over the next five years as the region
responds to an ageing population and increased demands for hospitals and other
"At present, Dubai has 2.1 hospital beds for every 1,000 residents. This is way
below the target of achieving the Organisation for Economic Co-operation and
Development [OECD] average of 4.8 beds per 1,000 people. OECD is a group of
high-income economies with a very high human development index and are regarded
as developed countries," Plumb told Khaleej Times.
"With the current shortage of hospitals, clinics and other healthcare
facilities, an ageing population and the rise of medical tourism, there is a
pressing need for additional healthcare facilities in the region over the coming
years," he said.
The shortage in hospital beds is prevalent in the region. According to JLL, the
Mena region is lagging behind more developed economies in terms of both per
capita spending on healthcare and provision of hospital beds. The per capita
spending on healthcare in the UAE is only 17 per cent of what is being spent in
Switzerland, and Mena has an average of only 1.9 beds per 1,000 population in
comparison to an OECD average of 4.8 beds.
"The region has an ageing population - the number of people over 65 years is
predicted to increase by 4.4 per cent on average in the next five years. To
maintain the current provision rate of hospital beds per person would require
the creation of 10,500 additional hospital beds in the five major cities across
the region over the next five years which equates to 70 additional hospitals,"
the report noted.
Plumb said the shortage is most acute in Saudi Arabia, where hospitals are
mostly owned by the government and there is a need for private capital to pour
in. The situation is unlike in Dubai where the private sector has already made
heavy investments in the health sector.
Plumb sees strong demand and government support for the healthcare sector as a
big opportunity for real estate investors to be more involved in the healthcare
"The strong demand and current shortage of hospitals, clinics and other
healthcare facilities makes this one of the most attractive sectors of the Mena
real estate market for investors, developers and contractors to consider over
the next five years," he said.
According to the JLL report: "The current provision rate of hospital beds per
person would require the creation of 10,500 additional hospital beds in the five
major cities across the region over the next five years, and assuming a typical
ratio of 150 beds per hospital means there would be a need for around 70
additional hospitals. To increase the provision of hospital beds in line with
the current OECD average of 4.8 beds per 1,000 people, a staggering 470,000
additional beds would be required, which equates to 3,130 new hospitals, to be
developed across these same five major cities by 2022.
"While hospitals are extremely specialist real estate assets and are not likely
to appeal to all real estate investors, clinics and other less specialist
medical facilities can be successfully incorporated into more generic forms of
real estate such as office buildings and retail malls," said Plumb.
He noted that returns from traditional sources such as residential, retail or
hospitality are falling and that opportunities from healthcare real estate are
more stable and secure in the long run."Real
estate developers cannot operate hospitals and similarly hospitals are not
property developers but the two skills sets can be combined to address the
growing need in the healthcare industry," Plumb emphasised.