Real estate lender and investor Octopus Real Estate is acquiring eight new care homes from developer, LNT Care Developments, for more than £100 million.

In one of its biggest portfolio purchases to date, Octopus Healthcare Fund, managed by Octopus Real Estate, is acquiring five of the homes at practical completion and will forward fund construction of the remaining three homes over their 12-month build periods.

The eight homes are located in Wombourne, Nottingham, Wakefield, Cannock, Kidderminster, Swadlincote, Redditch and Salisbury, and will all provide full en suite wetrooms and facilities. Once complete, seven care homes will be let to Ideal Carehomes and one to Elmfield Care, each on a 35-year lease. Ideal Carehomes is an existing Octopus Real Estate tenant, while Elmfield is a new ‘LNT care partnership’ operator formed by LNT with Elmfield’s directors.

Estate agent Knight Frank acted as selling agent for LNT Care Developments.

Chris Wishart, director of origination at Octopus Real Estate, said: “We are pleased to be working again with LNT, a developer with specialist knowledge in the sector, and of course with Ideal Carehomes, an experienced quality operator. Extending our relationship with both parties, in addition to Elmfield Care, is a key step in executing our strategy of funding modern care homes with robust fundamentals.”

Dermot Callinan, group director of LNT Care Developments, added: “We pride ourselves on using the LNT Way to find the best sites with continuously evolving build design to create efficiencies in the operational model which in turn ensures high levels of profitability and regulatory compliance as well as a homely quality care environment. We are pleased to have worked with Octopus Real Estate on a successful outcome and look forward to continuing our strong track record of care home development with a substantial number of sites in the pipeline.”

Nick Kempster, healthcare agency and development at Knight Frank, commented: “We are seeing an increased flight to quality from operators and investors within the elderly care sector, particularly as the pandemic has highlighted the undersupply of future-proofed assets and the need for further development within the sector. LNT lead the way in providing top-of-the-range facilities and innovation with their developments, and we were pleased to advise them on the sale of the portfolio and facilitate a successful outcome for both vendor and purchaser.”

Date published: December 15, 2020

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