David Hayton and David Abbott discuss the impact of high-end investment on the care sector

The UK care home sector attracted almost $2bn of US investment in the first half of 2025, expanding the number of luxury care home options in the process. Writing for Caring Times, David Hayton and David Abbott from BTG discussed the impact on the rest of the market, including the opportunity for revitalisation through renovation.

Investment levels into UK retirement properties have been rising for some time. In the article both David’s noted that the main trigger is a generation with significant wealth tied up in property alongside expectation of a high standard of living entering retirement.

From their experience larger rooms, concierge services, in-house facilities and attached care facilities are all becoming commonplace in modern, new-build complexes. Whilst the improvements in luxury options for the market is well discussed, in their opinion the impact on other areas has been less talked about.

David Hayton, Director and valuations expert at BTG, comments:

“Whilst improving the overall quality of the care home and assisted living facilities stock is clearly a positive move, there is an impact on older care homes. These buildings are starting to look increasingly less attractive to wealthier residents and investors, and that makes valuation and refinance significantly harder.”

Value against the market, EBITDA, demand for services and pace of change within the market are all considered when valuing for a refinance package, highlight both writers. This means that a significant influx of investment and high-end properties to the market adds complexity and it becomes difficult for lenders to feel the asset will maintain its value sufficiently over the next 10-15 years.

David Hayton continues:

“In this fast-moving market there is a risk that the pace of improvement might devalue these homes too much in their current condition, eroding their appeal. In this situation refinancing against an older care home might be more difficult as lenders look towards future values of property.”

However, the article notes that this is creating an opportunity for some care homes or developers to buy and renovate surplus stock from auction. Some auction houses saw more than £25m of care homes sold in the first half of 2025. Buyers ranged from other care home operators and investors to developers looking to convert care homes into non-specialised dwellings like Houses in Multiple Occupation (HMOs).

David Abbott, Managing Partner and financial advisory expert at BTG, comments:

“As part of a restructuring and refinancing solution some larger operators are seeking to sell stock through auction. Many smaller care home operators run by families who are qualified carers or healthcare professionals are growing quickly. 

“These operators are powered by a wide range of lenders – seeing the stability of these companies – that are willing to lend funds through asset finance to invest in acquisitions, growth or improvements to current stock. And renovation of old care homes is a real opportunity for owners of these businesses as they continue to grow.”

Billions of pounds of investment poured into the UK care home sector last year driving the expansion of the luxury market. Nonetheless, both writers suggest that if other operators have the capital or the support, then they can acquire surplus stock as the market moves. By renovating and revitalising ageing, yet established care homes, they have an opportunity of their own.