This Month's Articles: Making Children Pay, Pinders Healthcare Design Awards 2009, Moving Story, |
| Reasons to be Cheerful |
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Making Children Pay |
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In theory, the nursery and education sector should thrive during a recession, as more parents either have to return to work or work longer hours. |
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However, despite the potential for improved occupancy and profits, agents are reporting transactions as down on previous years. Consequently, those buyers able to purchase are seeking to negotiate on prices, whilst many vendors still appear confident of commanding the higher prices of the last few years. As soon as the current difficulty with reluctant bank funding begins to ease, so we should begin to see a more consistent or levelling-off of the market. |
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However, the other, often unreported, impact of the current economic crisis is the increasing incidence of bad debt, with parents taking sessions for their children for which they are simply unable to pay. This can have a serious effect upon the cash flow of a unit that, otherwise, may appear to be trading well in terms of its attendance levels or children on register. Increasing unemployment may alleviate the staffing situation in nurseries but the low pay rates often applied within the sector still ensure a low retention rate as people look for better paid jobs. Continuity in staffing terms inevitably still remains an issue, particularly as low pay rates conflict with the Government’s determination to maintain qualification levels within Early Years care and education. |
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| It presumably should only be considered as positive that our current Government remains firmly committed to ensuring the success of early start schemes. Many parents still need good Early Years provision and their children’s social, emotional and cognitive development can never be undervalued. Just as in the care sector, high standards of business practice in the nursery market should help to ensure that these businesses are equally never undervalued. |
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| Article by Pinders Director Steve Marriott |
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Pinders Healthcare Design Awards 2009 |
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This year’s coveted Awards took place at Lord’s cricket ground, where more than 490 guests enjoyed the spring sunshine, and took the opportunity to network with the biggest names in the industry. |
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| Cricketing great, Mike Gatting, entertained the audience in his capacity as an Ambassador for the Lord's Taverners. Thanks to generous sponsorship, and audience donations, £15,000 was raised for the charity on the day, enough to purchase a specially adapted minibus |
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Pinders have been organising the Healthcare Design Awards since 1999, and the presentation ceremony is now one of the 'must-go' diary dates in the healthcare calendar. The Awards aim to promote and recognise the very best developments in all types of care-related property. |
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The Award categories were carefully selected to acknowledge the achievements of the widest range of designers, developers and operators. Care establishments of all sizes, types and locations had the opportunity to enter, from those catering for the elderly and people with physical or learning disabilities, through to projects involving assisted living, close care, care villages and combinations of these various types of care, together with extensions to existing schemes. |
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Moving Story |
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If moving house is stressful, how much more demanding is moving an entire building? |
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Pinders have been acting as Project Manager on a site in Whitstable, which comprises a care home with extensions and a building known as the Granary. We have achieved planning permission to retain and refurbish the care home, demolish the extensions, and develop a new 50 bed care home for MHA. |
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As a condition of the planning consent, the Granary must be retained, but permission was granted to move the building to a more beneficial location. The challenge for us was that both the existing home and the Granary are Grade II Listed buildings situated within a Conservation Area, and it was essential to move the Granary prior to the demolition of the extensions. |
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| The first lift and move to a temporary position took place at the beginning of March this year, co-ordinated by Castleoak. As the building was mounted on ‘toadstool’ pads, a steel frame was fitted to the base, and the clay roof tiles were removed to reduce weight. The combined weight of frame and building totalled five tonnes. A further challenge was to retain the stability of this historic timber framed building during the moving process and consequently the frame will stay until the Granary is placed on new toadstool pads in its final location. |
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| Article by David Peters |
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Reasons to be Cheerful |
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The economic landscape has changed significantly in the last year and many harsh lessons have been learnt. Is it all doom and gloom or are there any positive signs on the horizon? |
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Well, if you are a regular reader of the Business section of the Daily Telegraph, you may have noticed recently that some positive news is forcing its way into the headlines, including improving business confidence within the UK and statistics to suggest improvements within the housing market, with the likes of the RICS and the Nationwide both reporting increases over the last three months. |
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Added to this, we now have the base rate at just 0.5%, the Government “encouraging” the main High Street Banks to lend more, and the Banks themselves beginning to utilise the Enterprise Finance Guarantee Scheme more frequently to ensure the availability of funds to businesses. With there being little encouragement for savers to put their money into Banks, combined with commercial and business values now having declined to more realistic levels, there are certainly incentives to invest in the business sectors and commercial premises at present. |
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| An interesting feature of the markets to date is that they have not been "flooded" by receivership or forced sales and wherever possible it looks as if the lenders are trying to support businesses, undoubtedly helped by lower interest payments. When businesses have sadly failed, there are opportunistic buyers in the marketplace looking to "pick up a bargain" but overall good businesses are still generally selling for realistic prices, which is reassuring and gives some stability to the markets. Whilst we are by no means "out of the woods", some commentators are now suggesting that the economy may pick up quicker than originally envisaged. |
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| To a large degree, this latter prognosis is still very dependent upon the availability of finance and in the new, more realistic world, borrowers should not expect to be able to borrow 90% of the purchase price, at 1% over base rate and with no arrangement fees, plus the free use of a Porsche for one year, thrown in for good measure! The Banks will look to lend to good operators, typically with a proven track record and with full due diligence having been undertaken. There will certainly be a “flight to quality” and this has been reflected in Pinders’ instructions during the last six months or so, with many of the Banks reducing their Valuation Panels to rely on tried and trusted advisors with the appropriate specialist expertise. The "back of fag packet" approach to both valuations and agency is hopefully a thing of the past - a reason to be cheerful in its own right! |
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| Whilst I am reluctant to issue those infamous words “There has never been a better time to buy”, in 12-18 months’ time, we may look back and reflect that 2009 was not such a bad time to buy a business after all. |
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| Article by Pinders Chariman Mark Ellis |
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