ELDERLY CARE FACILITIES GERMANY

Promoter – Financial Intermediary

KORIAN SE

Location

• Germany

Description

The project will finance the construction of long-term care facilities in the form of 180 shared assisted living homes, residential communities for the elderly persons. It will be implemented in various locations across Germany, mostly rural and small towns.

Additionality and Impact

As a health sector investment, the project supports the Bank's primary objective "Innovation, digital and human capital" (Health). This project addresses the sub-optimal investment situation in the European health and care infrastructure due to market failures originating from the public goods nature of services provided by health and care facilities and the large health externalities they generate. Furthermore, strategic investments in the health and care sector have been shown to yield long-term health benefits, as well as economic and social returns on investment that far exceed potential private returns. The project will be located in small towns and rural areas, contributing both decreasing equity of access to affordable elderly care as well as providing work places during operation. The project also tackles the need to reduce privately borne cost of long-term elderly care by offering affordable long-term care solution. The project responds to the demographic trends and requirements of Germany. The modern, digitalized and well-equipped long-term care premises will also help attract and retain care and medical professionals and increase productivity. The EIB involvement in financing this project will have a positive effect on potential commercial financiers to indicate that the project is commercially viable despite taking place in a sector with increased regulatory and reputational risk. The flexible terms offered by EIB are highly appreciated by the promoter and not readily available on the capital market.

Objectives

The project aims to deliver affordable and suitable solutions for elderly who cannot stay any longer alone at home, but do not need yet to go in nursing homes neither. This care model fills a gap between independent living and nursing care services, offering assisted living services with medical assistance in place, linked with day-to-day social activities. The goal is to enable and ensure healthy and active ageing, reinforcing the elderly people integration in the local community network.

Sector(s)

• Health - Human health and social work activities

Proposed EIB finance (Approximate amount)

EUR 150 million

Total cost (Approximate amount)

EUR 924 million

Environmental aspects

The construction will be aligned with the EU green taxonomy. The energy performance of the buildings is substantially lower than the country threshold set for the nearly zero-energy building (NZEB), aiming the Substantial contribution criteria to Climate mitigation. Prior to disbursement against any specific scheme, the Promoter will be obliged to provide to the Bank the evidence that schemes comply with relevant provisions of the environmental EU Directives, including Environmental Impact Assessment (EIA) (2014/52/EU amending 2011/92/EU), Habitats (92/43/EEC) and Birds (2009/147/EC) Directives as transposed into the national law. In addition, the Promoter will be requested to deliver EIAs (if applicable) to the Bank before the use of Bank funds are disbursed. As regards energy performance of the buildings, Energy Performance Certificates will be issued after completion of all facilities.

Procurement

The promoter is a private company not operating in the utilities sector and not having a status of a contracting authority. The promoter has an industrial and commercial character and it is not financed, for the most part, by the State, regional or local authorities, or by other bodies governed by public law; and is not subject to management supervision by those authorities or bodies; and not has an administrative, managerial or supervisory board, more than half of whose members are appointed by the State, regional or local authorities, or by other bodies governed by public law. Thus, it is not covered by the EU Public Procurement Directives.

Status

Signed - 15/12/2022