Article summary
- Healthcare sector pipeline growth was lower in 2022, with only 397 beds under development.
- The opportunity for investors in the healthcare sector remains strong due to the low bed-to-population ratio in Lagos.
- Private sector investment in the healthcare sector remains dominant, despite government initiatives aimed at rehabilitation and affordability. However, without growth in local healthcare competencies, growth may be slower than expected.
While 2021 saw record pipeline growth in the healthcare sector with an estimated 650 beds under development, 2022 was relatively toned down without any major healthcare developments announced and the pipeline was estimated at 397 beds.
Still, the opportunity for investors in the sector abounds with a previous mapping exercise of the healthcare sector by Estate Intel indicating that the bed-to-population ratio across Lagos remains low at 2.1 beds per 1000 population compared to the average OECD global density estimated at 4.4 hospital beds per 1,000 population as at 2020.
So far, the private sector continues to account for the majority stake in the sector estimated at 86%. This trend is set to continue despite recent government initiatives aimed at the rehabilitation of state-owned hospitals and enhancing affordability around health insurance through the ‘Ilera Eko program.
Overall, the outlook for the market is positive. However, without growth in local healthcare operational and fundraising competencies, growth may not be as fast as expected.
Author – Bisi Adedun