Retirement housing specialist McCarthy & Stone is planning to expand into the construction of nursing homes in response to pressure from its new owners to grow the business.
HBOS, Sir Tom Hunter and the Reuben Brothers, which bought McCarthy & Stone last September are keen to get a return on their £1.1bn purchase, a price considered by many to have been too high.
McCarthy & Stone believes one way of growing is to look outside its traditional retirement homes offer, which focuses on low-key assistance for the elderly, such as maintenance and gardening.
The company is also understood to be looking to increase its margin which, at about 30%, is among the highest in the housebuilding sector.
A source close to the company said: “Even the most efficient housebuilder can do better. Management sees where it can make improvements.”
The source said: “McCarthy & Stone is looking at other sectors of the ‘grey market’, such as more comprehensive medical care and nursing homes. There could be a floor that provides 24-hour care.”
Even the most efficient housebuilder can do better a source close to mccarthy & stone
The move is likely to deliver substantial growth, as the ageing population and increased pressure on social services is raising demand for accommodation for the elderly.
McCarthy & Stone is also likely to develop its assisted living division, which bridges the gap between retirement living and nursing home care, and includes domestic assistance and personal care by arrangement. The company is understood to have earmarked additional sites for these facilities.
McCarthy & Stone was delisted late last year when the HBOS-led consortium took the company private. Since then there have been several changes to the company. These have included the departure of Keith Lovelock, the chairman, and the appointment of David Pretty, the former chief executive of Barratt, as a non-executive director.
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