2020 was a devastating year for people across
the globe as Covid-19 caused a crisis that no one expected or even foresaw. The United Kingdom had it as bad as anyone with over 125,000 people losing their
lives to the deadly virus and many of them occurring perhaps avoidably in care
homes across Britain. It would be true to say that the health care sector has
taken a major hit.
However, there is something of a silver lining
to this very dark cloud and it exists in places where relationships are built
between medical and social commissioners, innovation-led investments are
encouraged and where there is a movement towards personalised models of care
and away from those that are condition-centred.
Even in this Covid-impacted world, we find
ourselves in, care
home investments still represent a sound financial and social proposition when dealing with a
particular calibre of care property. Let’s dig into the reasons why this is the
case.
CONCENTRATING ON
PEOPLE-CENTRED GROWTH
If the Coronavirus pandemic has caused
anything in the world of care home investments,
it’s a polar shift to sustainability-based private funding and an
Environmental, Social, and Governance (ESG) framework. In this new landscape,
investors are looking to reattribute their assets into operators that display a
culture for positive impact.
From the outside, the healthcare industry has
been suffering from major issues relating to how social and medical
organisations collaborate. These issues often result in a fractured experience
for the patient and a compromised ability to provide a safe and nurturing
environment. They also contribute to antiquated practices in UK care homes,
marked understaffing and a significant lack of available funding.
A SURGE IN DEMAND
IN THE COMING YEARS
A fundamental reason why selective care home
investments remain a viable option is the growth of the elderly population over the coming
years. The number of seniors with prevalent health conditions is set to grow
hugely in the next 20 years, with 1.2 million expected to exist by the year
2040, combined with a shortage of care beds available in the UK.
In this scenario, value-added private equity
investments represent the only sensible approach along with funding for
technological support enhancements for systems such as those that help with the
care of those living with dementia. This is what is meant by a person-centred
approach.
ETHICAL TECH-DRIVEN
SUPPORT
Regardless of the fact that the current
economic situation in the UK is less than ideal, investment in care homes remains a highly sustainable and ethical option that offers high-returns for
minimal risk. As a result, there are signs that ESG entrepreneurs are shifting
away from unstable sectors such as transport, retail and hospitality as a
result and favouring care homes.
As things stand, UK care home occupancy is
already sitting at over 80% and the number of admissions is accelerating all of
the time. Whether talking about smart IoT technology that enables companies to
remotely monitor those in their care or digital social and health care systems
that allow precise care decisions to be made based on real-time data, investors
are favouring care homes that operate using these improved TEC amenities.
ARTIFICIAL
INTELLIGENCE (AI) POWERED SYSTEMS
Much of what is possible with cutting edge
care tech is down to the power of AI and it’s enabling people to receive the
best reablement and preventative care available. What’s more, it’s technology
that greatly reduces the cost of providing this care, meaning that it’s far
more accessible now to more people than it has ever been before.
The viability of care home investments in the UK relies upon the continued existence of facilities that use these
technologies at the same time as offering virus-proof healthcare. This calls
for the prioritisation of reinvestment and restructuring of UK care homes so
that they remain operating during these challenging times.
UNPRECEDENTED
DEMAND CHANGES THE FUNDING LANDSCAPE
The unprecedented demand for care home places
in the UK has fundamentally changed how funding for care home investments is obtained, with traditional supply and financing routes no longer
representing a sensible path. There are expected to be approximately 28% more
people over the age of 85 in a decade’s time, so the situation will continue to
become more acute with each passing year.
The fact is that investing in care homes
offers double the return on investment provided by standard residential property
investment, however, operators still need to work to attract funding. To do
this, they need to offer investment incentives to those who are searching for a
‘hands-off’, ‘value-added’ opportunity. This could take the form of guaranteed
buy-backs, assured payment schedules and being able to offer tech-based
holistic care infrastructure.
TAKING CARE OF
FRONT LINE WORKERS
Sustainable investments rely on every element
working well and there is perhaps no more important factor in this equation
than the care workers who live on the front line. The model’s efficacy requires
that support is provided for health care workers who are feeling the intense
pressure that’s being placed on them. According to a 2019 survey, almost half
of UK healthcare providers are experiencing work-related stress, which in
itself is not sustainable.
Care workers are human beings and they need
financial and emotional support, which will require the implementation of a
comprehensive strategy to provide it. Care home investments[1]
are only viable if those providing the care are able to give it their full
effort and a stressed and over-burdened workforce is not the platform on which
to build success.
Keyword
CARE HOME
INVESTMENTS - VERY MUCH STILL AN OPTION
So, as you can see, UK care homes still very
much represent a viable option for investment, but only if the facilities in
question are forward-thinking with regards to new care-related IoT technologies
and have both their patients and their staff at the forefront of their
thinking.
Covid-19 has impacted everyone and it has
changed where the goalposts are, but investors looking for a sustainable option
that offers a meaningful return on investment need look no further than care home
investments.