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Experts predict mixed impact of Welltower competition ruling on regional care markets


Regional care home groups could be forced to sell homes to comply with competition law or struggle to secure investment after the Competition and Markets Authority’s (CMA) ruling on a US firm’s proposed takeover of more than 600 care homes, experts have warned. Conversely, the ruling could boost local


ownership diversity and raise standards, experts said. The comments followed the CMA ruling


that parts of US Real Estate Investment Trust (REIT) Welltower’s proposed takeover of more than 600 care homes owned by Care UK, Barchester and others could be anticompetitive in some areas.


Regional concentration “If the CMA is saying you can’t have regional concentration of assets, a regional player could face fewer buyers if an organisation is already above that threshold,” said care home group Blackadder finance director Michael Butcher. “From a purely economic perspective, a


market where assets cannot be freely bought and sold becomes constrained,” he added. Browne Jacobson partner and corporate


health lead Vicky Tomlinson said the CMA’s focus on the “influence that institutional investors and property owners can exert over operational strategy, pricing, investment


enough fragmentation in the market for these investment trusts still to deploy capital and buy groups.”


US ownership The case has also drawn attention to the growing footprint of US investors in the UK elderly care sector. Mr Butcher warned heavy investment trust


involvement would drive fee inflation and long-term unsustainability: “In 20 or 30 years’ time, investors will want


to sell and move their money. “There will always be buyers, whether other


decisions and competitive dynamics” signals it will “intervene and investigate” local health and care market consolidation.


Investment models The CMA’s scrutiny of investment models used by firms such as Welltower could reset expectations around acceptable landlord- operator arrangements, said Nationwide head of health and social care Derek Breingan. The CMA scrutiny “clears the narrative for


providers as the RIDEA [(REIT Investment Diversification and Empowerment Act] model has sneaked under the radar until now,” he said. “It’s good that it exposes the pluses and minuses and gives more visibility - there’s


Specialist US property firm invests £42m in UK care homes


A US-listed health and care property company has bought four care homes in the north and midlands for £42m, taking its UK health and care facility footprint to 138. CareTrust Reit said the new homes comprised 202 beds offering ‘high acuity’ mental health and specialist care services. It added it would acquire a fifth home for approximately £9 million as part of a ‘second tranche of the transaction following regulatory and other approvals’. The firm entered the UK market a year


ago after acquiring London-listed health and care property company Care REIT plc, adding 132 UK care homes (around 7,500


beds) to its US portfolio of over 200 homes across 25 States. Speaking after announcing stronger than expected financial results for the firm’s first quarter 2026 operating results, chief executive Dave Sedgwick said the firm expects to continue to grow quickly over the current financial year, supported by “deepening operator relationships across the US and UK”.


However, some sector experts have sounded a note of caution following the Competition and Market Authority’s ruling that fellow US real estate investment trust (REIT) Welltower’s takeover of over 600 UK


real estate investors or private equity firms, but each new owner will want a slice of the pie, creating continued upward pressure on asset values and, ultimately, care costs. “With fees already reaching £100,000 a year, it


would not surprise me if costs rose to £200,000 in 20 years because of inflation, the national living wage and rent structures,” he said. Meanwhile, Aston Brooke director Kashif


Majeed said local authority commissioners would welcome the ruling as, , as the implications are “practical rather than theoretical” for them. He said that although “a larger group can make commissioning easier.... the same concentration can also trouble them if it reduces the number of credible alternatives in a local market.”


care homes could be anti-competitive in some areas.


Browne Jacobson partner and corporate


health lead Vicky Tomlinson warned of the regulatory oversight could create “unintended barriers to the capital the sector needs to grow and evolve sustainably”.


June 2026 www.thecarehomeenvironment.com 9


Photo by Tierra Mallorca on Unsplash*


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