Batipart, the big property group which is a big investor in Korian, is quietly exploring the East European care home market with Senior Group, a small company ran out of Paris by Nicolai Kobliakov. We talk to him about demand for private beds in East Europe and his plans to launch an invasion of prefabricated cottages for the elderly in France. Kobliakov spoke at a recent session at property conference MIPIM arranged by Stephan Pichon, the healthcare property expert at Your Care Consult in Paris.
The plan is to go from a single 200 bed unit today in Riga in Latvia to four purpose build homes with 800 beds across the Baltic States and Poland. But Kobliakov also has his eye on Hungary and Slovakia. He says that Senior is building a 96 bed unit in Vilnius in Lithuania and negotiating in Cracow, Warsaw and Tallinn in Estonia. Kobliakov sold his Russian interests to Alexei Sidnev a few years ago. Sidnev now claims to be running the largest chain of nursing homes in Russia. Confusingly it too is known as Senior Group.
Kobliakov says that demand for private beds remains strong in the region. “I think there is room for approximately 5,000 private beds from Lithuania to Hungary” – a number he changes to 10,000 later in the interview. He is charging €1,500 a month in Latvia and expects plenty of buyers in Warsaw at PLN 6,000 a month. Occupancy in Riga has hit 50% less than 24 months into the project, and he thinks Russians will now take up the slack.
Interestingly, he sees Russians as major buyers. “The Russian government has just allowed elderly Russians to leave the country for care. Vilnius is only an hour away from Moscow by plane and yet our beds are half the price of Moscow.” He says a lot of Russians are sending their children to school in Latvia as well. “Many families like the idea of being outside Russia.”
He also says demographics are favourable – particularly in Poland. “There are only 17 beds per 1000 over 80 in Poland. That is three times lower than Estonia and two times lower than the Czech republic. Poland also has the fastest ageing population. Around 10pc of those over 80 need and can afford nursing homes. The numbers over 80 in Poland will triple in the next 12 years.” He says the only serious competitors are
Meanwhile, he is busy with a second project – Senior Cottage. These are prefab units for your parents and the smallest units don’t require planning permission under French law. Here he says he has already sold 12 and that a recent TV spot led to inquiries for another 15. He hopes to ramp sales up to 300 units a year by 2015.
Our Analysis: It is refreshing to talk to a real entrepreneur! Debate about the real level of demand in East Europe continues. French nursing home group Orpea looked at the market a few years back and concluded that it would struggle after 2-3 homes. Others are more optimistic. An informed source who knows Warsaw well says: “the real market isn’t just citizens of Warsaw. It is the parents of successful people in their 40s and 50s working in Warsaw who are worried about their parents, who they’ve left in some hole in the sticks.”
Source: Healthcare Europe / April 16th 2014