Pritchard's piece: Are care homes out of favour with lenders?

Pritchard's piece: Are care homes out of favour with lenders?



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So today (Monday 27th June) is the day of the Bridging and Commercial awards, with a chance to reflect on the highs and lows of the market whilst discuss strategies over a glass of mineral water. Mo may not always be everyone’s favourite publisher but he does throw a pretty good party……or at least I think so. The only thing I am slightly apprehensive over is the two hour journey by train wearing a monkey suit, especially as it looks like another scorcher today and I have to squeeze into an old one DJ today as I have just found the newest one on the floor in my wardrobe looking a little sad for itself.

 

High lights (and low lights) for me over the past week were finally finding a mezz funder who did what they said on the tin and getting that to offer, which means by the time we get paid we can probably afford Turkey for next Christmas, seeing a semi commercial in Hull (shop front plus two one bedroom flats taking £1200 per month) down value to 50k (90 day value) when the client and the comparables suggested closer to £100k for the same 90 day version, and also getting some real development funding at 60% which I thought may be longer in returning given the consistent tightening of the market. I have also over the past month or two noticed a continual change in the healthcare sector with lenders becoming much more reluctant to lend on the old fashioned elderly care homes and focusing much more on the more specialist assisted style care homes for those with mental illness or learning difficulties, which has been brought about by the latest changes in government focus on care payments. This has also meant that one or two more entrepreneurial business men are coming out with different models to offer to this sector some of which make good commercial sense but will still fail to get adequate funding until the banks really understand it better. I would be interested to hear if any brokers or lenders have had similar experiences or if it is just a one off that my firm is getting so many enquiries from that area.

 

Bridging itself seems to be chugging along still with too many fighting over certain areas and ignoring the rest of the country, however a few exceptions like Goldentree and once again Blemain have advertised that they are willing to look at anything that makes commercial sense and fits the basic elements of their funding line, also Precise appear to be eating away at some who thought they had world domination which will hopefully kick start some strategy reviews.

 

Well for those going have a lovely day today and enjoy the sun while you can!!!!

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