Case Study: Specialist care home renovations

The Challenge

An expanding Eastbourne-based specialist care home were looking at upgrading their facilities to better support their care workers and residents. They needed to make it easier to move residents, provide food at a larger scale, and keep residents with complex needs safe, and provide more support to part-time residents in the community. The home was required by their bank to not provide security guarantees to other lenders, and despite having a very substantial cash reserve, ran the risk of missing out on strategically significant property purchases if they were spent on property. They had therefore found it difficult to fund the operational investments needed, prompting them to explore asset finance services for care homes as a potential solution.

Our Solution

We visited the care homes in person to get an understanding of the range of assets that needed to be installed. These were in some instances unusual electrical installations, which required a specialist lender to look at. Seeing the strength of the business and capability of the director, we funded a number of assets directly using our own in-house lending facility.

We successfully created a split drawdown facility, which allowed the business to reduce their interest costs by only borrowing when they were required to pay for the next instalment of their invoice. By presenting the existing strength and strong historic track record of the business, a lender was comfortable to fund unusual assets without also taking any further guarantees from the business or the directors, which addressed the security issues their main bank had raised. This made it possible to tailor our asset finance services for care homes around the client's unique constraints and goals.

The Result

By using a hire purchase product across the assets, the care home was able to successfully pursue three initiatives simultaneously - free up cash for a large building extension project, create their expanded community care team to satisfy local demand, and deliver safety and efficiency improvements within existing homes. This both created a better care environment for residents, and allowed the business directors to turn their plans into a reality. Moreover, at the end of the finance agreements, they were able to retain the assets so residents could continue to benefit from them.