In anticipation of the forthcoming green paper on older people and parallel programme (England), independent funder Henry Howard Finance has reported an increase in care home owners looking to take advantage of a growing and more diverse customer base by investing in new facilities or better experiences.
The UK population is projected to continue growing, reaching over 74 million by 2039; with 18 per cent aged 65 and over and 2.4 per cent aged 85 and over. With this ongoing change in demographics, coupled with the National Living Wage, auto-enrolment, the workplace pension scheme, a nursing shortage and the financial uncertainty of Brexit, it is no surprise that more care home owners are facing challenges to their sustainability.
Care home owners often face difficulties securing financial support for these investments from traditional lenders, such as banks. Fortunately, the commercial lending market has evolved to fill the gap left by stricter lending criteria, with asset finance arrangements providing an attractive alternative.
“Many traditional lenders, such as banks, shy away from supporting businesses in this industry,” says James Barnes, account manager and care home finance specialist at Henry Howard Finance, one of the UK’s leading funders to SMEs.
“As SME finance specialists, we know this can be a significant barrier to growth for care home owners that need to update their premises, refurbish or invest in business essential equipment but don’t want to pay a significant amount of money upfront.”
Asset finance is a simple and cost-effective way to purchase the equipment or assets a business needs to grow or diversify, without having to pay a hefty bill upfront. For care home owners, this can mean access to finance to cover the costs of new nursing, incontinence, janitorial, laundry and catering products, plus furniture such as beds, nursing and patient moving equipment such as slings, hoists and transfer kits.
“It’s important to know there are a range of flexible finance options out there. We wouldn’t rule out lending to new owners of an existing care home or a care home seeking to expand its footprint. It doesn’t matter how small or large your premises are, we are open minded and will look at each application on a case-by-case basis.”
