Market analysis
from the pandemic is the increased focus on sustainability and heightened environmental awareness. According to a survey by Boston Consulting Group of more than 3,000 people across eight countries, 70 per cent of people are more aware now of how human activity impacts climate and the environment than they were pre- Covid.11
With COP26 dominating headlines
in recent weeks, climate change is solidly at the top of the agenda. Operators are therefore having to think about how they can cater to this and younger generations who are more environmentally-conscious and keen to place their elderly relatives in more sustainable homes. For example, a few months ago, we completed a transaction to support the first acquisition of a new joint venture between FORE Partnership and Amicala, that intends to develop up to £300m worth of ultra-sustainable, net-zero extra care later living schemes.
The road to recovery
Since our launch in September 2015, we have lent approximately £200m to the elderly care sector, supporting many of the UK’s leading operators. A good chunk of the funding we have done recently has been focused on growth - i.e. how can we help an operator grow the number of homes they operate, increase their regional presence with an appropriate structure in place that balances both debt and equity. In addition to this, we have done a number of transactions where we have provided roll-out facilities for growth and capital expenditure – an area we expect to do more of over the next 12 months. Understanding the dynamics of a business - whether the model is predicated on freeholds or on leaseholds, what the management team looks like, how aggressive the growth aspirations are etc. are all really important. Our outlook for the sector remains bullish, so if you are an operator looking for capital to grow – whether organically or through acquisition – do get in touch. We provide loans from £500,000 up to £50m and aim to complete transactions in days or weeks versus the months it takes traditional banks.
References 1. Smith, J., Overview of the social care sector, Prospects, November 2021 https://www.
prospects.ac.uk/jobs-and-work-experience/ job-sectors/social-care/overview-of-the-
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social-care-sector
2. Skills for Care, The size and structure of the adult social care sector and workforce in England, July 2021 https://www.
skillsforcare.org.uk/adult-social-care- workforce-data/Workforce-intelligence/ publications/national-information/The- size-and-structure-of-the-adult-social-care-
sector-and-workforce-in-England.aspx
3. Office for National Statistics, Overview of the UK population: January 2021
https://www.ons.gov.uk/ peoplepopulationandcommunity/ populationandmigration/ populationestimates/articles/ overviewoftheukpopulation/january2021
4. Alzheimer’s Society, Facts for the media
https://www.alzheimers.org.uk/about-us/ news-and-media/facts-media
5. NHS England, Dementia https://www.
england.nhs.uk/mental-health/dementia/
6. Financial Times, Care homes struggle as pandemic prompts changes to business model, 26 September 2021 https://www.
ft.com/content/722646fd-e139-41a1-b86b- be0da8d18117
7. Christie & Co, Care Mid-Year Review 2021, 15 July 2021
https://www.christie.com/news- resources/publications/july-2021/care-mid- year-review-2021/
8. HM Government, Our Plan for Health and Social Care, 7 September 2021 https://www.
gov.uk/government/collections/our-plan- for-health-and-social-care
n
9. The Guardian, Social care plan will help just a tenth of UK’s older people in need, 12 September 2021
https://www.theguardian. com/society/2021/sep/12/social-care-plan- will-help-just-a-tenth-of-uks-older-people- in-need
10. Associated Retirement Community Operators, Retirement Communities Fact Pack,
https://www.arcouk.org/sites/ default/files/ARCO%20Retirement%20
Ben Barbanel
Ben Barbanel is head of debt finance at OakNorth Bank where he leads a team that, since its launch in September 2015, has transacted over £6.5 billion of loans across hundreds of transactions. Prior to joining OakNorth Bank, Ben spent almost six years at Santander Corporate Bank, where in his most recent role, he was divisional head of business development for London and the south-east. Prior to Santander, he was at Clydesdale Bank where he focused on real estate finance. He also spent time working in a privately-owned real estate business helping to source, arrange, and manage debt. Previously, Ben worked as a manager in the commercial banking division of the Royal Bank of Scotland. He started his banking career at Mizrahi Bank in London.
Communities%20Fact%20Pack_ONLINE%20 aw4_0.pdf
11. Boston Consulting Group, The pandemic is heightening environmental awareness, 14 July 2020
https://www.bcg.com/ en-gb/publications/2020/pandemic-is- heightening-environmental-awareness
www.thecarehomeenvironment.com January 2022
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