Octopus Real Estate is financing the development of five “future-proof” care homes, valued at around £80m which will be operated by the New Care group on completion.
The homes, located in North West England, will provide a total of 347 bedrooms which will all have en-suite wet room facilities.
Knight Frank advised New Care on the funding partnership. Julian Evans, head of healthcare at Knight Frank, said: “The New Care brand and state of the art care settings are on point for ESG and welcomed by both operator and funding institutions. Supply chains are decelerating care home development and we are likely to experience a shortfall of new bed provision over the next 24 months.”
The Fund’s standard development funding terms now also include requirements relating to environmental, social and corporate governance.
This week, Octopus Real Estate, announced its commitment to building new care home developments that are net zero by 2030, which it says marks the first such pledge across the care home industry.
In addition to funding new developments to achieve carbon neutrality by 2030, Octopus will make significant investments into its existing portfolio of 71 care homes across the UK to retrofit these properties. It has committed to making these care homes and 13 properties currently under construction net zero by 2040.
Octopus said that its two net zero commitments were met with “unbridled support” from the institutional investors who invest in Octopus’ care homes strategy, “demonstrating the demand among pension funds, insurers, sovereign wealth funds and family offices for assets that are contributing to the UK’s energy transition requirements.”
As part of its commitments, where needed, Octopus will work to minimise and offset the embodied carbon in the construction process of its new developments, including through UK Government-approved, high-quality certified carbon sequestration projects.
“Our commitments place us ahead of both the UK Government’s net zero targets and the Paris Agreement targets,” said Michael Toft, care home senior fund manager, Octopus Real Estate. “Octopus Real Estate’s investors overwhelmingly supported these pledges, mirroring their overarching support for our care home strategy, which helps them to achieve genuine impact for society while generating financial returns.”