London 15 September 2020 – Allegra Care, the UK-focused care home operator, and Moorfield Group, a leading UK specialist real estate fund manager, have formed a partnership (the “Partnership”), with the aim to create an initial £125 million portfolio of modern, fit-for purpose nursing and dementia care homes.
Building on its expertise and track record in the ‘beds’ sector, Moorfield will initially be investing on behalf of Moorfield Real Estate Fund IV. Allegra Care will be responsible for originating and operating the assets and will also invest in the Partnership, which is targeting a portfolio of 15-20 homes over the medium term.
The Partnership will employ a strict investment criteria, targeting modern, fit-for-purpose homes with large communal areas, in demographically supported locations across Central and Southern England. The Partnership will seek to acquire both operational assets, including those offering asset management potential, alongside newly developed homes and is in advanced discussions on a number of acquisition opportunities.
The Partnership represents a major new entrant into the UK care home sector, which is valued at some £16.5bn1 and is underpinned by long-term demographic demand: the number of people aged 85 or over in the UK forecast to double to 3 million in the next 25 years2 and whilst the number of 75 year olds and above in the UK has increased by 10% since 2012, the number of elderly care beds has increased over the same period by just 1.5%3. Alongside this, operators are seeking to develop high quality residents’ wellbeing solutions, as residents and their families are becoming increasingly discerning in looking for modern fit-for-purpose homes.
Founded in 2018, Allegra Care is a specialist care home operator and is owned by Seniors Living Group Ltd (SLG). Allegra Care’s CEO Helen Jones has developed an award-winning model of care which is at the heart of the business, based on her long track record operating in the care home sector, primarily in Australia. During her career in Australia she developed and operated over 90 care homes.
The Partnership represents an extension of Moorfield’s existing approach to innovation in the residential sector, where it currently invests in retirement living (Audley), Build-to-Rent (More.), student accommodation (Domain). Earlier this year Moorfield entered the family home for rent sector with the acquisition of a portfolio of show homes leased back to UK housebuilder Avant Homes.
Commenting on the transaction Marc Gilbard, CEO of Moorfield Group, said: “The nursing home sector is a logical extension to our demographically driven investment strategy, as we look to build on our successful track record of investing at the early stages across the ‘beds’ sectors.
“The fundamentals for the UK’s elderly healthcare sector remain strong, and we expect the impact of the Covid-19 pandemic to be profound, accelerating the much needed delivery of fit-for-purpose homes, of which there is a chronic undersupply in the UK. Helen’s track record and experience in the mature Australian market means Allegra Care has the deep sector knowledge required at this unprecedented time. We look forward to Helen and the Allegra Care team using their experience and passion to deliver the level of service that is desperately needed.”
Helen Jones, CEO of Allegra Care, added: “We are excited to be partnering with Moorfield, which has an enviable track record of supporting the growth of businesses with a commitment to service quality. With our model based on the core principles of the household model, resident and staff wellbeing, service quality and staff development, we are focused on delivering on our acquisition plan with Moorfield Group, and adding value to the homes and teams that become part of Allegra Care.”
Allegra Care was advised by CBRE and Farrer & Co. Moorfield Group was advised by Connell Consulting and Shoosmiths.