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Summary of our market study
France has more than10.700 nursing homes.More than 730.000 people people live in retirement homes in France.
The proportion of Europeans aged over 65 represents over a fifth of the population, and this demographic group is set to continue growing. The UK and Germany will lead investment in retirement homes in 2020, with €13 billion and €11 billion respectively.
The French market is experiencing supply constraints, illustrated by a high occupancy rate of 97% in EHPAD (retirement homes). Major players such as Korian, Orpea and DomusVi are diversifying their services, notably by expanding into homecare.
The private sector manages a significant proportion of EHPAD (24% for the private commercial sector and 31% for the private not-for-profit sector)
Demand for retirement homes, particularly those specializing in medicalized care, has risen sharply. Between 2015 and 2030, the ratio of the elderly population (over 65) to the working-age population (15-64) is set to rise from around 29% to around 39%, and could even reach 50% by 2050.
Between 3 and 5 million elderly people could experience a loss of autonomy by 2050.
Medicalized establishments, in particular EHPAD (Établissements d'Hébergement pour Personnes Âgées Dépendantes), have become the predominant form of care for the elderly in France. There are over 7,500 EHPADs, housing between 600,000 and 620,000 beds.
Supply is not keeping pace with booming demand. One of the main reasons is the strict regulatory environment, which creates a barrier to entry and slows the expansion of new establishments.
The southern regions of France are particularly favored for their favorable climatic conditions.
Key market players
- Korian A pillar of care for the elderly, present in France and on the European market.
- Orpéa
- DomusVi is one of the main challengers with the acquisition of MEDEOS.
- Colisée enjoys sustained growth
- The market is also made up of smaller French EHPAD specialists, such as Omeris and Hermes Santé, who have chosen to focus exclusively on retirement homes.
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Summary and extracts
1 Market overview
1.1 Market definition and scope of study
The term "retirement home" covers several types of medical-social establishments offering a variety of housing solutions for the elderly. Retirement homes can be public or private, medicalized or non-medicalized, specialized or non-specialized, etc.
Medicalized retirement homes fall into 2 main categories:
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EHPADs (Etablissements d'Hébergement pour Personnes Âgées Dépendantes - accommodation establishments for dependent elderly people), which cater for dependent elderly people who require permanent supervision by a medical team.
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USLDs (Unité de Soins de Longue Durée - Long-term care units), with permanent medical staff and enhanced medical equipment to ensure total, constant care for senior citizens.
In Europe, the aging of the population is prompting governments to invest in the construction of new medical residences for senior citizens, as is the case in Germany, which has invested 10.860 billion euros in this sector.
As EHPADs are by far the majority of retirement homes, this study will focus primarily on this category. In 2019, France was home to 7,519 EHPADs, representing 70% of the country's retirement home capacity . USLDs accounted for less than 5.51% of capacity.
In 2021, EHPADs may be public (45% of establishments), private commercial (24%) or not-for-profit (31%) [Les Echos]. In 2019, 611,673 beds were available in EHPAD, with an average occupancy rate of 97%.
In France, the market for nursing homes is growing rapidly, driven by an aging population and increasing dependency among the elderly [INSEE]. This increase is set to accelerate further due to the arrival at 3ᵉ age of the generation born of the post-war "baby boom" and the continuing rise in life expectancy.
However, with supply outstripping demand, the market has been characterized for several years by significant challenges. In particular, the slowdown in the number of new establishments, existing barriers to entry, lack of financing and recruitment difficulties are key issues.
Inaddition, for several years now, establishments have been suffering froman image deficit[Les Echos]. Players are therefore focusing on modernizing their structures and seeking to improve residents' quality of life. In addition, the main players in the sector, such as Korian, Orpéa and DomusVi, are diversifying their offering, notably by strengthening their homecare services, taking over the entire operation of nursing homes and positioning themselves in alternative accommodation offers to nursing homes.
1.2 The European market
Europe's population is aging. In ****, the over-**s will represent more than a fifth of the European population. By ****, this proportion is expected to rise to almost a third. The European population aged ** and over is expected to rise from *% in **** to over **% in ****.
Proportion of the population aged ** and over Europe ...
1.3 A French market struggling to meet growing demand
In ****, ***,*** people will be staying in retirement homes in France.
Medicalized retirement homes account for almost **% of accommodation capacity for the elderly , with ***,*** people in EHPAD in ****.
Elderly care facility capacity and number of SSIAD places France, ****, in thousands Source: ****
In ****, France will have **,*** nursing homes. Between **** and ****, the number of ...
2 Demand analysis
2.1 The aging of the population and the rise in elderly dependency
Many countries, particularly in the western hemisphere, are experiencing a structural trend towards an ageing population, due to combined declines in mortality and birth rates. In France, not only is the number and proportion of elderly people increasing, but also the number and proportion of dependent elderly people. This phenomenon, which ...
2.2. Typical resident profile: a majority of women and GIR 2 residents
Medicalized retirement homes are designed for individuals who are already dependent on care and therefore need permanent day-to-day support.
The female population is largely represented, with around **.*% of senior women residents in ****. This can be explained by the fact that men die earlier, so the proportion of women increases with ...
2.3 Choosing a facility: quality of care and social ties as primary criteria
The quality of care and the quality of the social and emotional bond between staff and relatives are the main criteria taken into account when choosing an EHPAD for a relative. These two criteria are cited respectively by **% and **% of respondents, and are cited first by **% and **% of respondents.
The quality ...
2.4 The poor image of nursing homes
Often referred to as "mouroirs" (***), nursing homes do not enjoy a good image in France. The scandal that brought to light situations of neglect and mistreatment at the leading EHPAD, Orpéa, in the survey "Les Fossoyeurs" published by Victor Castanet in January ****, exacerbated this poor image.
An Ifop poll carried ...
3 Market structure
3.1. A fragmented market divided between the public and private sectors
Retirement home operators have one of three statuses:
Private not-for-profit (***). Private for-profit: residences managed by non-profit associations (***), establishments belonging to foundations, mutual benefit groups and congregations. Public: Establishments managed by the commune (***) or attached to a public hospital.
[***]
Differences in status also have a decisive impact on customers' choice of ...
3.2. Imbalances between supply and demand
Tensions between supply and demand
In the coming years, the so-called "papy boom" phenomenon, a consequence of the "baby boom" that followed the Second World War, is set to accelerate the growth in the number of dependent elderly people. With an accelerated aging of the population, linked to the post-war baby-boom ...
3.3 The sector's main challenges
The nursing home market is characterized by a number of challenges, the most important of which are as follows:
Lack of image (***) Mismatch between supply and demand (***) Recruitment Financing Digitalization
Recruitment
According to the Drees survey, there will be ***,*** FTEs in all facilities for the elderly in **** , **% of whom will be ...
3.4 EHPAD business model
EHPAD managers are both property managers and service companies. They therefore have two activities: property management and EHPAD operations.
EHPAD operations encompass a number of activities, in particular residence design, activity management (***), occupancy rate monitoring, resident selection and care by the management team.lection and care of residents, for example; financing ...
4 Offer analysis
4.1 Offer typology
The different types of nursing homes are as follows:
Source: ****
Under the French law of January *, ****, establishments with more than ** beds and a GMP (***). As a result, the majority of MAPADs have become EHPADs. By misuse of language, no distinction is generally made between the two, the term EHPAD being used ...
4.2 Prices
In France, the median monthly cost of a single room in EHPAD in **** is **** euros. The average cost is **** euros[***] According to the same source, it breaks down as follows:
An average daily accommodation rate : Single room: €**.** / day Double room: €**.** / day
Average daily care rate : GIR *-* : *.** € / day GIR *-* : **.** € / day DIR ...
5 Regulations
5.1 Current regulations
Law of January **, ****
Medicalized retirement homes are subject to EHPAD regulations, and therefore to the law of January **, ****.
In order to obtain the official designation of nursing home, an establishment must sign a *-year tripartite agreement with the Conseil Général du Département and the Direction Départementale de ...
6 Positioning the players
6.1 Segmentation
The following segmentation of players is used:
- Korian Clariane
- Orpéa Emeis
- Domus Vi
- LNA Santé
- Maisons de Famille Groupe
- Emera
- Domidep
- Residalya (groupe DomusVI)
- Medeos
- Omeris Réseau
- SGMR « Les Opalines »
- Medica France
- Domani
- Medicharme
- DocCity
List of charts presented in this market study
- The ten countries with the highest proportion of senior citizens
- Investment volume in retirement homes
- Proportion of people aged 65 and over
- Number of places in retirement homes
- Sales trends in France for the main market players
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Latest news
Orpea hopes to reinvent itself under the aegis of Caisse des Dépôts - 08/01/2024
- On December 19, 2023, Caisse des Dépôts et Consignations took control of Orpea with 50.18% of the capital.
- Orpea's share price fell by 99.7% in 2023.
- Orpea employs 76,000 people, including 45,000 caregivers, and more than 260,000 residents. Orpea plans to divest 500 million euros a year for three years.
Ehpad: Clariane (ex-Korian) refinances to avoid defaulting on payments - 14/11/2023
- Clariane refinancing plan: 1.5 billion euros Real estate partnership with Crédit Agricole Assurances (CAA) for : 140 million euros
- Negotiations for a second real estate partnership concerning assets in the United Kingdom: 90 million euros
- Asset disposal program planned for the following year: around 1 billion euros
- Proposed capital increase to raise: 300 million euros
- Fall in Clariane share price between October 24 and 26: 35.9%
- Capital increase announced by competitor Orpea: approx. 3.9 billion euros.
Ehpad: ex-Korian in dire straits - 14/11/2023
- Clariane (ex-Korian) is number one in France in the Ehpad sector
- The company has announced a €1.5 billion refinancing plan to avoid defaulting on its debts
- Sales up 9.0% in the first nine months of the year
- Clariane's Ehpad occupancy rate is 88.9%
- Clariane carries 1.6 billion euros of debt to be refinanced in 2023-2024
- The company's plan calls for 1 billion euros in asset disposals
- The company is considering a capital increase of 300 million euros, 200 million of which will be guaranteed by Crédit Agricole Assurances, Clariane's largest shareholder (24.8%)
Orpea launches a capital increase of around 3.9 billion euros - 13/11/2023
- Private nursing home group Orpea plans capital increase of around 3.9 billion euros
- Orpea's total debt exceeds 9 billion euros.
- Orpea's financial restructuring includes three successive capital increases, totalling 5.4 billion euros.
- On completion of the restructuring, a consortium led by Caisse des Dépôts, with Maif, CNP and MACSF, will own 50.2% of Orpea's capital, creditors will own 49.4%, while current shareholders will have 0.4% (if they decide not to participate in the capital increases).
Orpea: Ehpad occupancy rates recover - 07/11/2023
- Average occupancy rate for retirement homes in France in the third quarter of 2023: 84.4
- Year-on-year sales growth: +11.1
- Nine-month total sales: 3.9 billion euros
- Nine-month sales growth: +10.8
- Sales target for 2026: 6.4 billion euros
- Occupancy rate target (clinics and Ehpad) in 2026: 90.8
- Expected sales in 2023: 5.2 billion euros Expected occupancy rate in 2023: 84% (vs. 81.6% in 2022)
- Planned capital increases: 3.9 billion euros
- Share of capital held by the consortium led by Caisse des Dépôts in December 2023: 50.2%.
- Net debt at the end of 2023: 4.65 billion euros.
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