Market insight
could reduce the care home population greatly.
Before Covid-19, some dementia care homes I have spoken to have told me that the level of dependency of newer admissions seems to be getting higher, so there is already a trend in this respect. Yet at current rates the dementia population looked after in a care home is due to grow by around 16 per cent over the next five years, and due to high mortality rates within that age group, the true growth of dementia means that by around 2027 the dementia population will be made up of people who have not yet been diagnosed. So, even if there is a shift from care homes to community care, the dementia population within care homes will still be massive. Above all this is, of course, the hope that a cure for dementia - or a way of slowing its development - will come as soon as possible. Dementia is a massive influencer on the care home sector.
New investment in existing homes In addition to openings being well up year on year during the first quarter of 2020, sales and purchases were looking good as well, with a 3 per cent increase in
Openings +79%
January-March April-August
Change of Closures 2% - 8% -31% Figure 1: 2019/2020 year on year changes, care homes for older people
activities year on year. It is not surprising to see that this activity reduced, falling by around 12 per cent year on year between April and August, as many impending deals will have stalled or even stopped. Within this reduction, around half of all the deals that were completed in this period were sales of the Four Seasons brand from its administrators. The largest purchasers included
Roseberry Care Centres, whose 13 purchases has increased their portfolio to 29 locations, predominantly in northern England. Their purchases were from small groups, mostly in administration. Barchester Healthcare Group meanwhile added eleven homes to their group through the purchase of Four Seasons locations through their Barchester Hellens company. Barchester also added four new homes through openings, and so are by some length the most expansive care group during this period.
Marton Care added ten homes through procurement, nine of which were from Four Seasons, which brought their total portfolio up to 14 homes. Marton Care are connected to the Burlington Care Group, who have a further 17 homes.
Conclusions
It may be an insensitive thing to say but it seems that Covid-19 has come at the wrong time for the care home market. It is difficult to know if without the pandemic the government would have been true to its word to “fix social care”. At the same time, post-Brexit negotiations have moved to forefront again.
It seems there always seems to be something that diverts attention from social care reforms. Health and Social Care Secretary Matt Hancock has said that while work had started on reform, he would not give any idea as to when it would be delivered.
Investment in existing care homes that are fit for purpose in the mid to long term, will increase as investors see bargains ahead
44
Yet as the Social Care Institute for Excellence’s Beyond Covid: New thinking on the future of adult social care report concludes, now is the time for bold action to transform social care for decades to come.
“After nearly 20 years of underfunding it is time to call time on austerity. The
www.thecarehomeenvironment.com • November 2020 -12% ownership +3%
©CSI Market Intelligence
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