Covid, Ukraine, interest rates, tariffs, Iran. Sadly, geopolitical and macroeconomic shocks have become the norm, and uncertainty has become one of the few constants. For sectors that crave a stable outlook, the past six years have resembled a botched rollercoaster, with many scary drops and few reassuring climbs.

That has certainly been the case with real estate. Just when there appeared some respite from the dizzying falls, another lurked around the corner. The latest Trump-induced twist has seen gilt yields spike once more on inflationary pressures. This came at a time when everything seemed set fair, with interest rates on a downward trajectory.

In these times of uncertainty, looking to resilient, inflation-linked income from sectors exhibiting positive long-term demographic trends seems a sensible approach. Despite the London-listed REIT universe shrinking dramatically during this extended period of uncertainty (with another, Alternative Income REIT, last week announcing it was in merger talks), there are still a number of companies displaying these characteristics.

Healthcare real estate can provide that sense of certainty in an uncertain world. Whether that is doctors’ surgeries or care homes – demographic tailwinds and inflation-linked leases make for a compelling proposition.

That is on offer at the UK’s largest healthcare REIT, Primary Health Properties (PHP). Its secure, government-backed income is low risk and non-cyclical and has provided the bedrock for progressive income generation and a 30-year track record of dividend growth.

Fresh from its merger with peer Assura in 2025, the company is targeting 3%-plus annual rental growth from its £6bn portfolio. It says that it is ahead of schedule in capturing cost-synergies from the merger, and more importantly is on the road to reducing its debt pile (it took on a £1.225bn bridging loan to fund the cash element of its Assura acquisition) and bringing its LTV back below 50%.

Paying down the floating-rate, bridging loan has become critical given the rising yields in bond markets. Fortunately, it has already made headway, cancelling £225m, and it is close to releasing equity from its £700m private hospital portfolio by bringing on a strategic joint venture partner. It is also selling further properties into another JV structure.

Demographic tailwinds supporting the sector are obvious, with a growing and ageing population. The NHS’s 10-year turnaround plan is built around moving care from a hospital to a community setting. That requires huge investment in more modern primary healthcare facilities. Other priorities include shifting focus from treatment to prevention and moving more processes from analogue to digital.

Early intervention requires greater involvement of primary health, while technological advances in diagnostics and an upgrade to electronic health records both promote more use of local services.

Target Healthcare REIT (THRL) often goes under the radar but goes quietly about its business and is delivering for shareholders. All of the leases on its £895m portfolio benefit from inflation linkage, while the long-term demographics in the care home sector are as positive as any in real estate.

The Office for National Statistics forecasts that the number of over-85s in the UK will double from 1.8m in 2025 to 3.6m by 2050, with one-in-eight over-85s requiring long-term residential care.

Market trends within the care home sector are also favourable to THRL. Depressingly, only just over a third of care home beds in the UK are categorised as fit-for-purpose, possessing an en-suite wet room. All of the beds in THRL’s portfolio come with an en-suite wet room (36% for the wider market), while its rooms are both larger (48 sqm versus 40 sqm) and environmentally friendlier (100% EPC rating B or above versus 46%). The company says that a move to quality accommodation has been appreciated by residents, and for investors the supply/demand imbalance can be better captured by THRL’s care homes, given that the vast majority of fees are private pay (77%).

This is displayed in the rent that THRL’s care home tenants pay it now being covered 1.9x by revenue – a healthy state of affairs.

Social housing has been weighed down by weak tenant covenants, following a spate of regulatory judgements on providers in the early 2020s, but Social Housing REIT (SOHO – under the management of Atrato Capital) seems to be turning a corner.

We have long been advocates of the sector and it is pleasing to see signs of progress being made at the company, which has been trading at a heavy discount for a prolonged period. The company, which provides specially adapted homes for vulnerable adults, reported a marked increase in earnings in 2025, comfortably covering dividends (the first time since IPO).

All of its income is 100% inflation linked and essentially government-backed through the local authority, although it is not guaranteed if the approved provider tenant gets into financial difficulty, which has been the case with two high profile tenants in recent years. These leases have been reassigned to stronger covenants and management is confident the portfolio is in a settled state and that it can move on with growing the fund.

First, it needs to restore investor confidence. It plans to do this by improving the quality of its cash flows and reducing lessee risk by effectively ring-fencing the rent it is owed from the approved providers in their bank account. It is discussing the mechanics of this with a large tenant, as well as the regulator, and all being well will look to roll this out across the portfolio.

It will then look to scale up its portfolio through acquisitions of social housing portfolios from private funds. It plans to use its shares to offer private equity exit opportunities and believes its discounted share price (at 36%) is equivalent to what could be achieved in the market. Investments could also be made in the wider living market. It stresses that these investments will share similar inflation-linked income profiles and demographic trends.

Resilience of income is more important than ever. With it, shareholders can hopefully look through constant uncertainty with confidence that income will at least continue to rise.