review
A new model for healthcare estates?
O
ngoing Brexit discussions continue to affect the healthcare sector, with a lack of capital funding having a major impact on the quality of the estate.
And it was this challenge that was central to the speaker sessions at the ninth annual healthcare buildings forum, held last month in Northampton. Organised by hdm sister company, Stable Events, the sessions were a key part of the one-and-a-half day networking event which gives healthcare product and service suppliers the opportunity to meet key decision- makers involved in the design and build of health and social care facilities across the UK and further afield. Over three keynote addresses, nine experts discussed everything from the death of PFI and the future of healthcare construction funding to the design of children’s healthcare facilities and how the estate is diversifying to reflect the arrival of proton beam therapy cancer treatment in the UK.
An expert view
They included Crispin Walkling-Lea, head of healthcare planning at Great Ormond Street Children’s Hospital; Bob Wills of Medical Architecture; Franko
Covington of HKS Architects; Connie Shiel of Scott Talon Walker Architects; Burkhard Musselmann of Stantec; Jonathan Ainley of BAM Construction; and Duncan Finch of Avanti Architects. Delegates also heard from PFI expert, Martin Cannon of BrowneJacobson, who revealed that, following the collapse of PFI operator, Carillion, last year; the funding model was ‘dead in the water’, adding that it was unlikely there would be ‘buy back’ of existing PFI projects due to an ongoing lack of capital. But, he said it was likely that, once
Brexit was dealt with, and a possible new government had settled in, there would be an emergence of new funding models to underpin the next generation of healthcare buildings.
These would need to be lower risk than PFI, and more affordable. “In the short term, the problem is deeper than just Brexit,” he said. “The NHS is realising they can’t do what they want to do and are doing what they need to do just to keep going. “New models will need to be developed; finance options that get money in off balance sheet and which are affordable. “It is more likely these will be mutual investment models, where, for example a charity will commit £5m and borrow a further £45m to develop a new facility. The developer will then build and manage the project.
Transferring risk “It looks like PFI, but it’s transferring the risk and, importantly, any profits are shared so they go back into frontline services.” One light at the end of the tunnel could come from institutional investors, such as pension funds, which are seeing
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healthcare buildings as a good place to put their money.
Clough said: “Investors want to
increase healthcare allocations. “They want diversification away from
residential and retail and healthcare is hugely attractive as it’s long leases.” But, he said, there was a lack of expertise within institutional lending organisations on the very-specialist healthcare market.
“The biggest challenge is a knowledge gap,” he said. “We need to work with professionals to better understand these buildings and what they are expected to do.”
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