Significant Growth in Care Home Sector for Commercial Refurbishment Contractor

Significant Growth in Care Home Sector for Commercial Refurbishment Contractor

As a commercial refurbishment contractor in the care home sector we have have seen significant growth over the last year. Our contractors have years of experience understanding the demands of residential homes and ensuring the work exceeds CQC standards.

This article from explains how this sector is growing regardless of Brexit instability.

Care homes in the UK remain an attractive proposition to investors, with property advisor Knight Frank saying it is the sector ‘least affected by Brexit volatility’.

Its 2018 Care Homes Trading Performance Review reveals occupancy rates in care homes are at a record high of 89 per cent with their sixth consecutive increase. It also shows that average weekly fees have risen for the seventh successive year by 3.7 per cent to £773. Profitability stands at 28.3 per cent as measured by EBITDARM.

Knight Frank attributes the rise in occupancy rates to an increase in life expectancy and expects demand to continue to rise, with the number of people over 85 in the UK predicted to more than double in the next 23 years to over 3.4m.

Julian Evans, head of healthcare, Knight Frank, said: “Despite operational challenges, the care home sector remains a highly attractive investment. In our view it is the one that is least affected by Brexit volatility as demand is typically driven by domestic factors.

“The defensive characteristics of the sector and long-term income combined with the fundamental strength of the occupational market makes the care home sector appealing to those investors wishing to diversify their asset portfolios.”

Demand for care home beds continues to outstrip supply. In the last year there were 226 home closures comprising 6,740 beds. This was due to rising staff costs, which have increased 4.7 per cent in the past year, the continued impact of the National Living Wage, a constrained labour market and an acute shortage of qualified nurses, according to Knight Frank.

In addition, many buildings are not fit for purpose, with 85 per cent of UK care home stock over 40 years old, and with insufficient funding available for the refurbishment and future-proofing of existing care homes, it said.

Mr Evans added: “We predict that despite current economic uncertainty and rising costs, care homes will remain a compelling asset class for investors as they seek to balance risk and return.”

Around 6,500 care homes are at risk of closure over the next five years, according to the property advisor which predicts that the UK needs in excess of £15bn to upgrade existing beds in order to future-proof the industry.

Read the full article here >