Octopus Real Estate, part of Octopus Group and a leading UK specialist real estate lender and investor, has provided an £11m loan on a ground up development of a 71-bed elderly care home in Bedhampton, Hampshire.
The property is currently a cleared 1.6-acre site that benefits from full planning permission to build a new care home over three levels. The care home is designed to deliver superior levels of care in order to create the best asset in the catchment area.
In addition to high quality residential accommodation, there are also plans to include a hair salon, café, cinema, library, activities room, private dining on the ground floor and a gym on the second floor.
The developers – Craig Griffin at Halebourne Group and Seamus Halton at Connaught Care Group – began development prior to completion of the deal, and the care home development is due to be completed in early 2023.
Andy Scott, Head of Residential Development, Octopus Real Estate, commented: “This development is a great example of our sector working together to continue to address the significant supply-demand imbalance for modern purpose-built care homes. Designed to deliver the highest quality levels of care, it also supports Octopus’ commitment to continue investing in and developing best-in-class specialist properties in the care home space.
“This deal has benefitted from strong collaboration between Octopus Real Estate’s Development Lending and Care Homes teams, which uniquely positions us in the care homes space.”
Seamus Halton, Founder & Chairman at Connaught Care Group said: “I’ve been in the care home development industry for over 25 years and for much of that time there have been extremely limited routes to funding our developments. Having non-bank lenders with deep sector experience, like Octopus, in the market is transformative. I’m delighted that Octopus has funding that enables us to finance developments like Bedhampton with unique parameters, including the ability to commit less of our own capital. This allows us to spread our capital further and develop a considerably greater number of care homes, which will be crucial for the UK’s rising social care demands.
“The process with Octopus was incredibly streamlined, with the period from agreement to drawdown only taking three months. That timeframe is unheard of in the traditional lending market. We are already in discussions to finance further developments with Octopus and are looking forward to a long-term partnership with the development team.”
Craig Griffin, Founder & CEO at Halebourne Care Group said: ““This is my second care home funding with Octopus, having very recently just completed a successful forward-funded 80-bed care home project in Berkshire. I am delighted to be engaged again with the Real Estate team now on our latest project. We are actively pursuing several further opportunities nationally and look forward to the prospect of Octopus Real Estate funding these when live in the future.
“The Development Team throughout the due diligence process has been truly professional and a pleasure to work with, which makes the entire process so much more effortless in what can often become quite an unnerving experience. Octopus really understands the care home sector both as a landlord and a lender; this has been proven with all the associated external professionals they engage with, which ultimately makes the ‘project journey’ so much easier and efficient”.
David Yeadon, Executive Director, SPF Private Clients, said: “With Seamus at Connaught and Craig at Halebourne both being longstanding clients of SPF, it was important we identified a lender that understood their requirements and was able to deliver a funding package efficiently and professionally. Octopus certainly achieved that mandate. We hope this will be the first of many transactions we’ll be working on in partnership with our clients and Octopus.”