Margate’s Royal School for Deaf Children site goes up for sale

Margate’s Royal School for Deaf Children site goes up for sale

 

In one of Margate’s largest land sales in recent years, the former site of the UK’s oldest deaf school, the Royal School for Deaf Children which dates back to 1876, has been placed on the market.

The 14.7 acre campus, on Victoria Road and Park Crescent Road, close to Margate town centre, is being marketed by property consultant Eddisons on the instruction of the school’s trustees. The site features around 120,000 sq ft of school buildings, including various residential properties that once accommodated students, and a recently constructed hydrotherapy pool and gym.

The land and buildings, in the rapidly gentrifying coastal resort, are expected to generate high levels of interest among property investors and developers, with recent local land sales achieving upwards of £700,000 per acre.

“We are marketing the site on either a conditional basis, where we will work with a buyer to bring forward their vision for the site, or on a more straightforward unconditional basis,” said Eddisons director James Liddiment. “While there are a number of potential options and uses for the land, all of which will be explored, including an ongoing educational use, we suspect the strongest demand will emanate from residential developers, especially given the shortage of housing stock generally.”

The Royal School for Deaf Children site, which is available for sale as one site or potentially split into separate lots, includes a variety of buildings associated with the school. Among them is the main secondary school complex, which is made up of a vast mix of interconnecting single-storey buildings, and a separate primary school building.

There are also ten residential buildings on the site, all of which have been adapted or constructed for supported living or residential care, and the campus also includes recreational facilities such as sports fields, sensory garden and playgrounds.

Further information on the 14.7 acre campus site is available at https://www.eddisons.com/property-search

 

Written by: James Liddiment on Wednesday 26/10/2016

 

 

Figures Show Rise in Insolvency Cases Among UK Property Investors

Figures Show Rise in Insolvency Cases Among UK Property Investors

 

A newly compiled set of figures has shown a considerable increase in the number of property investment companies around the UK being entered into insolvency in recent quarters.

But rather than being taken as a negative indicator for Britain’s commercial real estate sector, the trend is in fact being attributed to an increase in property values and rental rates around the country and particularly in London.

According to the commercial law firm EMW, there were 346 instances of commercial property investment companies entering insolvency in the second quarter of 2015, which represents an 8 per cent increase as compared with the same period of the year before.

The figures also represent a continuation of a longer term trend with the number of insolvency cases in this context having more than doubled from 154 in the second quarter of 2011.

EMW explains its own findings by suggesting that banks are becoming more inclined to push for insolvency proceedings in situations where their property investment customers have been unable to make repayments on their debts and have effectively existed only as ‘zombie’ companies for the past several years.

Until relatively recently there has been little or no incentive for banks to push for insolvency proceedings in these cases but there is now much more optimism that value can be extracted from what were generally considered to be bad debts in the wake of the credit crunch and the financial crisis.

“Banks have been holding onto these sour loans since the credit crunch struck and are using this opportunity to recoup some of the value tied up in this bad debt,” explained Geoff Willis from EMW.

“Ironically, the rise in insolvencies is down to the improved property prices, rather than an indication the market is in trouble,” he continued.

“Higher occupancy levels and rental increases, especially on office investments in London and the South East has driven up prices.”

Continued growth in demand for office space in various parts of central London, including most notably the West End and the City of London, has been a key source of optimism and value increases with the UK’s commercial property sector in recent years.

Ironically, the rise in insolvencies is down to the improved property prices, rather than an indication the market is in trouble.

 

Written by: Anthony Spencer on Wednesday 06/01/2016

A third of UK care homes facing threat of insolvency

A third of UK care homes facing threat of insolvency

 

According to recently released research from Company Watch, almost one third of care home operators in the UK are struggling financially.

In fact, over 400 care homes are in danger of declaring insolvency altogether, the report reveals. The risk management group looked at the financial reports of the UK’s 5,500 care home operators, and based on the findings estimate that as many as 1,650 companies are struggling money-wise. Of those, it projects that a quarter – accounting for 1,500 sites in total – will fall into insolvency.

Nick Hood, business risk advisor at insolvency group Opus Restructuring, says that blame lies with the current business model of many care homes, as it is both unprofitable and unsustainable. “The slight improvement in the financial health of the sector since last year is encouraging, but a business model that dictates 75% gearing, and delivers a profit margin of less than 1%, is simply not sustainable,” he said. “We all know that local authorities cannot afford to pay higher fees and that the minimum wage is expected to rise by 3% in autumn. When you add in rising energy costs and the strong likelihood of interest rate rises in 2015, the first since 2008, this creates even more pressure on poorly performing homes.”

Financial trouble beleaguers Britain’s largest operator

Rising interest rates, increasing costs associated with staff, and cuts made by local authorities are all factors that have attributed to the financial difficulties that many care homes are experiencing.

Four Seasons Health Care is the UK’s largest care home operator with 470 homes, but according to credit rating agency Standard & Poor, they could default on loans and run out of funds by as early as the first half of 2016. “The negative outlook reflects our view that FSHC will face a liquidity shortfall in the next six months absent any restructuring of its capital structure, which we consider will become unsustainable over the short term,” they said of the findings. As a result, Four Seasons is reportedly aiming raise £60 million in a fire sale, and is though to have appointed specialist bankers to restructure its financing. However, a great deal of restructuring would indeed need to take place as the company faces a mountain of £500 million in debt, incurred when the firm was acquired in a buyout in 2012. With annual interest payments along totalling £50 million, Four Seasons faces an enormous struggle to rectify the situation.

Four Seasons, alongside other care home operators, wrote to Chancellor George Osborne to warn him of the repercussions that closure would have, along with the difficulty other homes will face if fees remain the same and the minimum wage increases. Nick Hood affirms that the issue of Britain’s financially-failing care homes is not something that can continue to be ignored. “Government austerity measures have slashed top line income, while labour and other essential costs are rising all the time through factors that are mostly outside the control of care home operators,” he said. “Something has to give if major problems are to be avoided and if capacity is to be increased to house the escalating number of the elderly and the vulnerable in society.”

 

 

Written by: James Liddiment on Sunday 01/11/2015