Investment

A great example of an alternative investment

People often ask ‘What is an alternative investment?’  Well here is a good example. This investment buys a care studio in an already built care home which is being refurbished. Now there is plenty of demand for these care homes because they not only provide the correct care elderly patients need they also free up resources of local hospitals where these patients invariably are being looked after. A straightforward patient care model where everyone benefits. So you would think that local and national government would be building hundreds of these care homes throughout the UK especially as the elderly population is going to keep on growing and NHS services keep on being stretched.  Sadly, however, you would be wrong for the simple fact that the authorities just do not have the money available to build these care homes.

This is where the private sector can and is stepping in with many new care homes being built or refurbished to modern CQC standards and local authorities are falling over themselves to secure the available units for their patients. Now in order to finance these care homes, developers have increasingly been ignoring the banks instead turning their attention to the investment market. Instead of looking for one or two very rich investors they are looking at multiple investors with much lower investment amounts. They do this by dividing up the care home into individual units and selling leaseholds on each unit. Much the same as you would the flats in a tower block. In return for buying a leasehold, the developer then agrees on a leaseback amount each year and an exit agreement, usually, this means the developer buying the leasehold back at a higher price.

This then is what we would term alternative investments the developer is happy because they pay less in interest and they don’t have to go into debt. The investors are happy because they are getting much higher returns for their money plus they have security in that they own a leasehold to the unit in a commercial business that has a growing market. Let’s not forget the Authorities and the elderly patients who also benefit and having more beds being made available in hospitals benefits everyone.

We currently have a limited care home investment offer where the developer pays an 8% annual leaseback on the investment. The developer aims to sell each unit as quickly as possible with an assured 20% return so investors could get a 20% return on their money in months! For more information: Studio Care Home Investment For The Elderly

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