PROPERTY FOCUS: What are the challenges with selling a care home?

business for sale

Jo Thornley, Head of Brand and Partnerships at Dynamis, and partner of, and, offers guidance on selling your care home.

The UK care home sector is generally well protected by legislation. So, from a prospective sale point of view, a care home in the right location, with the right balance between private and publicly funded beds, and without too much local competition could be a very saleable asset.

Yet on the other hand, ensuring you can demonstrate compliance with every requirement could be a major undertaking. So, let’s look at some of the challenges and complexities involved with selling a UK care home, particularly during the COVID-19 crisis.

Story continues below

Get your documentation in order

Prospective buyers (and their due diligence teams) are sure to be aware of the importance of compliance. So, make sure you have your contracts, policies, assessments, certifications, inspection reports etc. up to date and in good order. Allow plenty of time for this because of the sheer volume of paperwork and requirements: lift maintenance, clinical waste disposal, risk assessment, hygiene reports – the list goes on and on.

From a selling point of view, any shortcomings in this domain will give buyers a poor impression and may raise suspicions about other areas too. And if you need to get up to speed fast in some areas, do remember the compliance requirements may vary dependent upon whether or not you also offer nursing care.

Make good staffing a priority

The care sector is a ‘people’ business but is known to sometimes be prone to staffing issues. So potential buyers will want to know about staff turnover rates and will also want to learn about qualifications and training. And from a regulatory perspective, they will want to see details of the range of staffing contracts applicable to your workforce. Don’t forget this should also include salary, pension contributions and other contractual benefits as applicable.

Your workforce will also be covered by the TUPE (Transfer of Undertakings (Protection of Employment)) Regulations 2006, which also requires you to consult with employees and/or their representatives about any impending transfer.

Managing the news

Beyond direct staffing issues, residents and their families will understandably have concerns about any change of ownership – as indeed will your employees. So, once you have reached a good understanding about a potential sale, you must also come to an agreement with the new owner about how news of the transfer will be made public.

Assuming you are selling a ‘going concern’ both buyer and seller will have a vested interest in discussing how the practical details and any future plans will be communicated to staff, residents and all other stakeholders – which may include the implications for ongoing care contracts with external agencies.

The Care Quality Commission

Details of your Care Quality Commission (CQC) inspections will form an important part of your reputation for responsive good practice. But in addition, you must inform the CQC immediately when you have agreed to sell the business.

This body has an important responsibility to ensure continuity of care, so get them involved at an early stage, and keep them updated. Note too that the CQC maintains a record of any breaches of standards. So, it is not only wise, but essential, to disclose any such shortcomings to a prospective buyer – who will check such details in any event.

Maintaining care standards

It’s not easy to keep operating to a consistent high standard when change is in the wind. But you must keep things running as before for many reasons – your buyer’s team may insist upon warranties and indemnities covering consistent care standards. Furthermore, any deterioration in the level of care might trigger CQC sanctions, possibly even jeopardising your planned sale.

The COVID-19 crisis

This infection affects some regions more than others, but the whole UK care sector is particularly at risk. You must, therefore, be absolutely clear you can demonstrate not only strict compliance with all preventive measures, but also show you have systems in place to protect the ongoing care of residents, as well as robust arrangements to protect all staff and carers. And it will help your cause if this compliance, plus any local measures, are well documented.

Despite this somewhat daunting list of challenges, well planned and well documented preparation should ensure your care home for sale stands out from the rest. This should help deliver a sale which safeguards your interests, and keeps your residents and staff properly protected too.

Tags : Best practicecare home sale

The author Lee Peart

Leave a Response