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McCarthy and Stone launch £100m land acquisition fund

22 July, 2020

A £100 million land acquisition fund has been launched by major UK developer and manager of retirement communities, McCarthy and Stone, and it is seeking to redevelop a variety of health and social care sites currently occupied by care homes, GP surgeries and other similarly sized medical premises.

In response to the Prime Minister’s call to “build, build, build”, McCarthy and Stone is looking to work with businesses and landowners to identify 60 or more sites over the next year which are suitable for the development of new retirement communities. The move follows successful ventures between McCarthy and Stone and care home operators who are looking to re-purpose premises or sell surplus land to enable the renewal or growth of facilities elsewhere, along with many other care home operators and medical practitioners.

McCarthy and Stone is looking for sites between 0.5 to five acres on central brownfield locations, ideally with level access to shops, and in a prominent location close to the high street or to local amenities. It will consider every type of land deal, whether unconditional purchase, conditional contract or option agreement.

There is also an appetite to develop sizeable sites jointly if a healthcare element is required, and the company will also consider building a healthcare unit, a doctors’ surgery or pharmacy for instance, within the new building, with operators and the future residents benefiting from the end use.

McCarthy and Stone chief executive John Tonkiss said the 60 new sites would complement the company’s existing workflow, it having purchased 200 sites over the last four years. The sites would provide private apartments and bungalows across a range of tenures with on-site care and support services for older people.

“The Prime Minister is spot on in recognising that housebuilding will be central to the UK’s recovery effort, and more and better housing for older people is a critical part of the mix,” said Mr Tonkiss.

“We believe our land acquisition fund has the potential to yield long-lasting knock-on effects for the health and social care sector, not least because the regeneration of brownfield sites will free-up capital for operators, business owners and medical practitioners looking to reinvest in growth and create jobs. What’s more, centrally located retirement communities have a role to play in the government’s drive to revive town centres, and new developments which bring new customers into an area could provide a lifeline for local businesses.

“We now need new land, and lots of it, in order to satisfy this vital initiative. For more than 40 years, we’ve accumulated a deep understanding of what our customers want – and also what is expected by landowners and other partners with whom we collaborate. Professionalism, efficiency, expertise – these are the qualities we’ve nurtured over many years so that when we agree to buy a site, we can perform a swift turnaround with an optimum return for sellers.

“With generous commissions available for the right sites, I would urge landowners to submit their introductions directly to us without delay. They will be treated in the strictest confidence.”

Despite a challenging few months of trading caused by the national lock-down, McCarthy and Stone is in a very strong cash position. The company has also secured £300 million from the Government’s Covid Corporate Financing Facility (CCFF) to support its plans.

The developer is predicting a strong increase in the demand for retirement living, given that those aged 65-plus are set to grow by 43% in the next 20 years. McCarthy and Stone says its 441 existing communities have also proved safe places to be for its homeowners during the Covid-19 pandemic, where the impact of the virus has been around half that seen among the 65-plus population generally.

McCarthy and Stone chief executive John Tonkiss

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