Opportunity to support a respected regional operator to replace an old care home which was no longer fit for purpose with a modern, well appointed new care home.
Target provided 100% of the development funding which was attractive to the developer, however this was capped at a maximum commitment for Target ensuring downside protection in the unlikely event of cost overruns.
The developer had assembled a highly-experienced team with a main contractor and professional team all of whom had a track record in developing purpose-built, premium care homes.
From the operator’s perspective, the rent was set at a sustainable level that works in the context of the local market.
Regional operator who has a good knowledge of the local area and strong relationships with local commissioners (gained through its successful operation of a separate care home in nearby Telford).
The new home is complementary to the operator’s existing Telford thereby enabling cross referrals.
Operator with growth ambitions thereby providing the potential for follow-on investment opportunities.
The new home was developed in the grounds of an existing 45 bed care home, constructed in 1868. Whilst the home was located in an attractive setting, the building itself was a conversion which has suffered from under investment and no longer met modern care standards.
The transaction facilitated the construction of a new 68 bed care home whilst the existing home remained operational. This allowed the existing residents to transfer into the new home at practical completion.
The new home is an exceptional and very well-appointed property, with 68 bedrooms laid across two floors all of which have access to outdoor space either by way of direct access to the landscaped gardens on the ground floor or through a large terrace on the first floor.
Several feature / “destination” areas such the theatre / cinema room, resident bar, an activity room and also a private dining room which residents can use for family occasions.
Undersupply of market standard care beds in the catchment area (i.e. those with bedrooms with en-suite wetrooms) and 78% growth expected in regional bed demand over the next ten years.
Poor quality of competing stock.