The main focus is on classic nursing homes
Despite increasing demand for new forms of living and care, the project developer HBB from Hamburg sees the need for classic inpatient nursing homes “growing” as well. In an interview, HBB Managing Director Oliver Radünz explains the quality of service that is important in competition with other forms of housing.
Interview: Darren Klingbeil
Hamburg // HBB Hanseatische Betreuungs- und Beteiligungsgesellschaft mbH is a project developer of retail space and shopping centers. On the other hand, it develops and realizes nursing homes for the elderly, which it holds in its own portfolio and which are operated exclusively by Domicil Seniorenresidenzen SE from Hamburg.
In view of the spread of new forms of living and care, is the classic nursing home a model that is being phased out?
Oliver Radünz: In our view, the new forms of living and care are leading to a supplementation and broadening of the range of services. In view of the considerable need in most German cities for nursing care close to home for all degrees of care, even in the long term, we see the need for inpatient care – and thus also for classic inpatient nursing homes – as not only high but also growing. However, the decisive factor is the right choice of location, a precise site analysis and a property tailored to the location in question – and the operator’s corresponding concept. For HBB, as a long-term investor and portfolio holder of 42 nursing homes, this means that, irrespective of current trends, we examine every region, city and neighborhood under consideration in detail before we get involved.
How does the trend toward creating new types of housing in inner-city neighborhoods fit with HBB’s focus as a developer and investor?
We see this as a complement. HBB has specialized very successfully in inpatient senior care homes in premium locations. We build and invest in inner-city locations that are right in the middle of life – which is also the slogan of our operator Domicil. For example, we have developed 16 locations in the heart of Berlin, three in Frankfurt and two in Munich. Right in the middle of mature urban residential districts. The development of such locations is only possible with the right expertise, a solid capital base in the background and a lot of staying power. In view of the space requirements for our facilities and our specialization, we continue to see the construction of conventional inpatient nursing homes as our main focus.
Do you also notice that, as a result of Corona and insolvent retailers and hotels, the supply of space in the city center is growing? Corona as an opportunity to get back into downtown locations with senior living?
Indeed, a generally difficult or possibly crisis-ridden economic environment can also be an opportunity for a social property that operates in a partially regulated care market and has to compete against other forms of real estate use such as residential construction or the hotels you mentioned in the inner-city environment, especially in terms of land price competition. We have perceived it that way for at least the last 20 years – and it is recognizable that currently not every price is paid for every inner-city space anymore. We are taking a close look at this and will respond accordingly. In any case, we are currently seeing more opportunities to acquire space in good inner-city locations than we did two or three years ago. This is helpful for a supply close to home, and also for a mix of uses in the city center. In strong real estate markets, local politicians are also called upon to explicitly earmark and reserve space for social uses and, in particular, inpatient care. In some cities, this is the only way it is at all possible to establish nursing homes for the elderly in the city center in price competition with other forms of use. The homes you have developed are characterized by a wide range of services, such as catering and housekeeping.
How do you plan service orientation into a project right from the start?
It’s important to think clearly about the concept and the aspirations you want to realize before the first planning step, or to be precise, even before you buy the land. We see ourselves as a premium provider here. All our facilities have their own kitchen, where fresh food is cooked every day. All our facilities also have their own laundry. The latter makes ecological sense, as we don’t have to drive the laundry across half of Europe, we reduce delivery traffic in inner-city residential areas – and our residents are happy to get their laundry back in a very timely (and complete) manner. We reject locations where we cannot implement this due to insufficient space.
Do you also think service orientation in terms of staff? Do you plan affordable living space for nursing staff at the same time?
In addition to the residents, the employees are the clear focus of our entire real estate planning. Working in nursing homes for the elderly is a considerable challenge for the entire workforce. For this reason, too, we have decided to build only new buildings in the senior citizens’ nursing home sector, as this is the only way we can create a high-quality working environment and the appropriate technology for the employees. In very tight real estate markets, such as in Munich, we can also imagine building employee housing if all the necessary conditions are met.
What is your value proposition to the operator with whom HBB works and to local authorities?
One of HBB’s main focuses is the construction of and long-term investment in senior care properties in selected inner-city locations. We make sure that the choice of location is excellent, we have high expectations of our planners and, with our own architects and external specialists, we also make sure that the construction quality is very good. The property should also offer added value for the residents of a neighborhood over and above the nursing services, for example through supplementary counseling services, our cafeteria with the food on offer, or events. We want to create not only nursing care close to home, but also added value in terms of infrastructure – and we want to do this with a residential property.
In which regions are you currently planning new properties?
Our expansion is currently focused on Bavaria, Hesse, Saarland and Rhineland-Palatinate. However, we can also imagine building further facilities in Berlin. We will be completing our 16th senior citizens’ nursing home in Berlin in the fourth quarter. We recently completed a facility in the middle of Frankfurt – for which we spent a year demolishing a four-story high-rise bunker – and recently a facility in Friedberg in Hesse in a villa district. In the fall, we will complete our senior citizens’ nursing home in Bad Vilbel, which we developed in very close cooperation with the city. We have planning permission for locations in Coburg and Kempten, where we will also be starting construction in the foreseeable future. Otherwise, we are currently building in Saarbrücken and have further sites under development in Saarland. We would like to expand sustainably in Munich, Franconia and the Allgäu region.
The HBB group of companies, headquartered in Hamburg, has been active in the real estate sector as an investor and project developer for over 50 years. Retail, office, hotel, senior citizen and residential properties have been built throughout Germany. HBB sees itself as a specialized investor with the aim of creating successful long-term value. HBB is an owner-managed company and has a well-trained team of now over 100 employees.
Mr. Oliver Radünz
Phone: +49 (0) 40 600 907- 200