There are refreshingly bullish predictions about the care sector coming from some of the key financial and property analysts – alongside some encouraging financial announcements from providers. Our investment news round up will bring you up to speed with who’s buying, who’s selling, who’s expanding and who’s ready to cut the red ribbon on a new facility.
Market trends and predictions
With the collapse of Silicon Valley Bank and uncertainty about Credit Suisse creating yet more turbulence on the investment markets, it’s encouraging to see some confidence returning in the care sector. Knight Frank is predicting a bounce back for the sector this year. This sentiment is echoed by Christie & Co, who report that buyer appetite remains strong, despite more than 300 care homes closing on average per year in the five years leading up to the pandemic
Knight Frank’s and Christie’s reports will brighten the outlook for many, especially following confirmation that more care homes closed than opened in 2022, with a net loss of 230 beds, according to the eighth annual report from CSI Market Intelligence.
Growing confidence in the care sector may account for why an investment bond offering over 6% interest when investing in companies providing social care for the elderly closed early after being fully subscribed by a wide range of retail and institutional investors.
This bullish sentiment has been reflected in financial announcements from a number of care providers. Excel care has bounced back to make £3m annual profit after last year’s losses, BN Care are set to double in size due to the large investment they have received of £3.4m from BGF alongside additional funding from HSBC, while two international billion pound companies have completed their first join UK care home build.
This has similarly been matched by a number of providers announcing expansions. Untold Living, a new later-living developer and operator, has received backing from investment firm Matter Real Estate to acquire and develop multiple schemes across the UK: they have secured sites in Crawley and Shropshire. Care provider Curaa are expanding their portfolio by signing a deal for a fourth care home within East Hertfordshire.
Elsewhere, Lancashire is set to have a sustainable new care home opening soon with a large investment of £7m from Lancashire County Council. Bognor Regis’s care home, Aldersmead is receiving a refurbishment and upgrading to become a 38-bed home. A Manchester facility is following suit and expanding to a 79-bed care home with the help of CareConcepts and Knight Frank advising on the deal.
On the other side of the coin, some providers have been releasing some of their assets. Target Healthcare REIT have sold their final four care homes in Northern Ireland. Morris Care have sold six care homes in Shropshire and Cheshire for £56m to Impact Healthcare REIT.
More completed sales include Sky Care Homes, a subsidiary of the Montreux Healthcare Fixed Yield Fund, buying Zero Three Care. Treetops residential home in Margate has been purchased by Denver and Misha Rajaratnam, who also own Wychdene Care Home in Broadstairs.
For those looking to get into the care sector or expand their portfolio, there are some exciting opportunities. A London college has hit the market with a freehold site for sale with retirement-living plans already approved. Another care home in Bath, with 0.58 acres of gardens for residents to enjoy, has had its sale price reduced. A South Wales nursing home is up for sale at an affordable price of £750,000. This means that there are many opportunities all over the UK in 2023 for those wanting to dive into the care sector.
New facilities/care homes
Many of the Fulcrum team were delighted to celebrate the best in care sector design at the last ever Pinders Healthcare Awards last month. Having seen the creativity that is lifting the sector and the positive investments across the country, it is little surprise to us that 2023 Q1 saw a raft of announcements about new facilities and care homes.
Chartwell House in Kent have welcomed their first residents by having them cutting a ribbon on arrival. Another care home has been completed for Country Court Group as they open their newest addition in Northamptonshire bringing their total number of care homes to 36. Norwich’s newest facility from Danforth Care Homes offers up to 66-beds for those who need retirement living dementia care or respite. Orchard Care Homes have opened their fourth specialist dementia facility at its Paisley Lodge Care Home in Leeds. Signature have opened a new care home in Farnham Common which provides 74 studio apartments for residents.
With an imminent expected completion date, Falcon House in Stafford are looking for nurses and housekeepers to help provide support to adults with learning disabilities. Ahead of opening, New Market Harborough have appointed their senior team which is set to open its doors in September of 2023 and provide up to 76 beds. Meanwhile, Barchester Healthcare is due to open a new 64-bed facility in Winchester shortly.
New facilities announced
Across the UK there are many facilities in the pipeline announced during the first three months of the year. Brundell Property Group in East Grinstead have set out an application to build a new 85-bed care home. In the neighbouring county of Kent, Boutique Care Homes have announced the acquisition of their fifth care home and will hopefully commence construction in late 2023.
In more new facility announcements, a new 66-bed Whitby care home is being developed by LNT Care Developments and will be operated by Cromwell Care, a family-run business. Shropshire is also expecting a new care housing development for over 55’s as Extra Care have received another £15m to provide another 70 properties. In Scotland there are plans for a care home to be developed in place of an old nightclub starting in March of 2023; the aim is to reinvigorate the town centre and bring a modern location to the over 65s.
If you are a care home investor with an interest in professional social care consultancy, please get in touch.