• The homes, which are already let to Barchester Healthcare, provide quality accommodation for elderly, often high-acuity, patients
•  They were developed with investment from Bridges Ventures’ Sustainable Property Fund and the CarePlaces Fund, a joint venture between Bridges and Castleoak
• Bridges has now successfully exited nine of its care home investments

Property funds managed by Bridges Ventures (“Bridges”), the specialist sustainable and impact investor, have sold four care homes to a private investor for a total consideration of £40m, delivering a strong commercial rate of return for investors.

The four homes are located in Brackley in Northamptonshire, Mollington in Cheshire, Wadhurst in East Sussex, and Basingstoke in Hampshire. All four were developed by Bridges in partnership with Castleoak, a property developer that focuses exclusively on high-quality care and retirement housing. The first three investments came from Bridges’ Sustainable Property Fund, while the fourth was an investment from the CarePlaces Fund (“CarePlaces”), a Bridges/Castleoak joint venture.

In 2010, Bridges identified healthcare – and care homes in particular – as an attractive property sector, in line with its strategy of focusing on investments that can make a positive societal impact alongside attractive commercial returns.

The ageing population and lack of public sector funding for the elderly, particularly those with specialist care needs, was creating a shortfall in the supply of high-quality accommodation. At the same time, private-sector operators were seeking new, purpose-built facilities primarily for private-pay residents.

The homes at Mollington, Wadhurst and Brackley were Bridges’ first investments in the sector, and represented the start of its partnership with Castleoak, a developer with over 20 years of expertise in the sector. Bridges and Castleoak then strengthened this partnership by creating CarePlaces, a £100m portfolio of 10 care homes (including the Basingstoke site) designed to provide a better standard of care housing for elderly, often high-acuity (including dementia) patients. Thanks to the incorporation of various sustainability features, the CarePlaces portfolio also includes some of the most environmentally-friendly care homes in the UK.

Following this transaction, the Bridges-managed funds have now sold nine of their care home investments. In March, CarePlaces sold two care homes in Diss and Stoke Mandeville to Octopus Healthcare for a total of £20.5m, reflecting a net initial yield of 5.4%. Previously, in November 2014, it had completed its first exits with the sale of three care homes to Legal & General for a combined £25m, reflecting a yield of 5.5%.

Simon Ringer, Head of Property Funds at Bridges Ventures, commented:
“Our care home investments have proved to be an excellent illustration of Bridges’ property investment strategy. We were able to identify an area where there was not only a clear societal need, but also a compelling demand-led commercial opportunity. That allowed us to develop a portfolio of assets in the sector that has delivered both tangible social and environmental impact, and also attractive returns for our investors in excess of 20%.”

Notes to editors

About CarePlaces

The CarePlaces Fund was launched in the summer of 2011 as a partnership between Bridges Ventures, a specialist sustainable and impact investor, and Castleoak, a specialist developer of care and retirement housing. Its objective is to deliver steady, sustainable long-term returns for investors by offering a first-class product and service to care providers, while also offering care operators an equity partner with a genuine interest in, and respect for, the work being done in looking after older people and those with specialist care needs.

About Bridges Ventures

Bridges Ventures LLP (“Bridges”) is a specialist fund manager focused exclusively on sustainable and impact investment. It invests in SMEs, properties and social organisations that can generate positive impact and superior returns for both investors and society as a whole, focusing on four key impact ‘themes’: health & wellbeing, education, sustainable living and under-served markets. Its property funds typically invest in niche sectors, regeneration areas and buildings showing environmental leadership. Bridges now manages almost £600 million across its Sustainable Growth, Property and Social Sector funds.

About Castleoak

Castleoak has specialised in care accommodation and retirement housing since 1996, delivering 200 care homes and 3,000 apartments across the UK. The £60 million turnover group is the leading name in the development, design and construction of quality care homes, extra care apartments, care villages and retirement living.  Castleoak develops long-term partnerships, and many customers have chosen to work with the business for over 10 years. Today, 84% of projects are from returning customers.  In 2011 and 2014 Castleoak was named HealthInvestor’s Property Developer of the Year.