Care Home Operators Looking for Properties - A Guide for UK Landlords

Learn what care home operators looking for properties typically require, including location, property size, planning, CQC requirements, refurbishment, lease terms and how Fraser Bond can support landlords.

Landlords with larger houses, former care homes, bungalows and other suitable buildings may find opportunities when care home operators looking for properties need premises for new or expanding services.

Care home operators can require properties for residential care, nursing care or specialist services for particular groups of residents. The building itself is therefore only one part of the assessment. Operators also need to consider planning, CQC registration, property standards, accessibility, staffing requirements and the financial viability of the proposed service.

For landlords, understanding what care home operators need can make it easier to prepare a property and approach suitable operators.

Why Are Care Home Operators Looking for Properties?

Care home operators may search for new properties for several reasons.

An operator may want to:

• Open a new care home

• Expand an existing care business

• Relocate an existing service

• Develop a specialist care service

• Acquire or lease a former care home

• Convert a suitable property

• Increase capacity in a particular area

• Establish a new residential care service

The requirements can vary considerably depending on whether the proposed home will provide residential care, nursing care, dementia care, learning disability services or another specialist service.

What Properties Are Care Home Operators Looking For?

A suitable care home property normally needs to work both physically and operationally.

Operators may assess:

• Number of bedrooms

• Bedroom sizes

• Number of bathrooms

• Communal areas

• Dining facilities

• Kitchen facilities

• Garden and outdoor space

• Parking

• Accessibility

• Fire safety

• Location

• Property condition

• Potential for refurbishment

• Potential for future adaptations

A property does not necessarily have to be an existing care home to attract an operator. Some operators may consider residential or commercial properties that can potentially be adapted, subject to planning and other requirements.

Location Is a Major Consideration

Care home operators may look for properties in areas that provide suitable access to local services and a practical environment for residents and staff.

Potentially important factors include:

• Access to healthcare

• GP surgeries

• Hospitals

• Pharmacies

• Shops

• Public transport

• Parks

• Local amenities

• Residential surroundings

• Staff accessibility

• Parking

The appropriate location will depend on the type of residents the operator intends to support.

A specialist dementia care service, for example, may have different location and property requirements from a care home supporting younger adults with learning disabilities.

Former Care Homes Can Be Attractive

A former care home may be of particular interest to an operator because the property may already have features associated with residential care.

These could include:

• Multiple bedrooms

• Communal areas

• Accessible bathrooms

• Commercial kitchen facilities

• Passenger lift

• Fire safety infrastructure

• Staff areas

• Parking

• Existing care-related layout

However, landlords should not assume that previous care use automatically means the property can immediately operate as a care home again.

The proposed operator must establish the current planning position and satisfy CQC requirements applicable to its service.

Planning Use Needs to Be Checked

Planning should be considered before agreeing a lease or spending significant money on conversion works.

A property previously used as a care home may have a different lawful use from an ordinary residential house. A recent government planning appeal, for example, refers to a care home operating under Class C2 before proposed conversion to residential dwellings.

The precise planning position depends on the property and proposed use.

Landlords and operators should consider:

• Existing lawful use

• Planning history

• Planning conditions

• Proposed number of residents

• Proposed care model

• Required alterations

• Local planning policies

• Building regulations

• Accessibility

• Fire safety requirements

Where there is uncertainty, obtain professional planning advice before committing to a transaction.

CQC Registration Is the Operator's Responsibility

Care home operators providing regulated activities in England generally need to register with the Care Quality Commission before operating those activities. CQC states that carrying on a regulated activity without registration is an offence.

CQC's current location guidance also specifically identifies care homes as locations where people live as their main or sole residence and receive care or treatment there.

For landlords, this means a property should not simply be advertised as "CQC approved" because it was previously used as a care home.

CQC registration relates to the provider, regulated activities and relevant location. A new operator needs to establish its own registration requirements.

What Does CQC Look at?

CQC's registration process considers whether a provider is able to deliver regulated services safely and effectively.

CQC states that providers need to have the appropriate locations and staff ready before applying, and that premises must be suitable for the intended service.

The regulator can consider factors including:

• Service model

• Staffing

• Qualifications and experience

• Policies and procedures

• Management arrangements

• Size and layout of the premises

• Design of the property

• Safety arrangements

This means landlords should work with the prospective operator to understand what the building needs before agreeing substantial refurbishment or a long-term lease.

What Makes a Property Suitable for a Care Home?

Although every operator has different requirements, certain features can make a property worth investigating.

Bedrooms

The number, size and layout of bedrooms need to work for the intended residents and service model.

Communal Areas

Care homes generally need appropriate areas for residents to eat, socialise and spend time together.

Bathrooms

The number and accessibility of bathrooms should be assessed against the proposed occupancy and residents' needs.

Accessibility

Depending on the service, the property may require:

• Level access

• Accessible bathrooms

• Lifts

• Handrails

• Wider doorways

• Suitable corridors

• Accessible parking

Outdoor Space

Gardens and outdoor areas can be important for residents' wellbeing and may be particularly relevant for specialist care services.

Specialist Care Homes Have Additional Requirements

A care home operator may be looking for a property for a specific group of residents.

Potential services include:

• Older people's care

• Dementia care

• Nursing care

• Learning disability care

• Mental health support

• Physical disability care

• Younger adult care

• Specialist residential care

The property should therefore be evaluated against the intended service rather than simply described as a generic care home.

For services involving autistic people or people with learning disabilities, CQC requires providers applying for relevant residential services to demonstrate that their service meets the Right support, right care, right culture standards.

How Much Refurbishment Might Be Needed?

Some care home operators looking for properties will consider buildings that require refurbishment.

Potential works can include:

• Bedroom refurbishment

• Bathroom upgrades

• Wet rooms

• Kitchen improvements

• Fire safety works

• Electrical upgrades

• Heating improvements

• Accessibility alterations

• Flooring

• Decoration

• Door alterations

• Security improvements

• Garden improvements

Before agreeing who will fund the works, obtain detailed specifications and realistic contractor quotations.

Fraser Bond can support landlords with refurbishment planning, building works, contractor coordination, repairs and property maintenance where required.

Who Pays for Care Home Refurbishment?

This should be agreed before the lease is signed.

Possible arrangements include:

• Landlord-funded refurbishment

• Operator-funded works

• Shared costs

• Rent-free periods

• Contribution towards specified improvements

• A negotiated combination of these arrangements

The lease should clearly establish:

• Who pays

• Who manages the works

• Who owns improvements

• Who maintains them

• Whether landlord consent is required

• What happens when the lease ends

• Whether the property must be reinstated

A solicitor should review the arrangement before significant expenditure is committed.

What Lease Terms Might a Care Home Operator Want?

Care home operators may seek longer leases because establishing or converting a care home can involve considerable investment.

A lease may need to cover:

• Lease length

• Rent

• Rent reviews

• Deposit

• Guarantor

• Break clauses

• Permitted use

• Repairs

• Maintenance

• Insurance

• Alterations

• Adaptations

• Assignment

• Subletting

• Reinstatement

• Compliance responsibilities

A landlord should assess the operator's financial strength alongside the proposed rent and lease length.

A long lease is not automatically beneficial if the tenant's covenant strength or contractual obligations are unclear.

How Landlords Can Check a Care Home Operator

Before signing a lease, carry out appropriate due diligence on the operator.

Consider reviewing:

• Companies House records

• Trading history

• Financial information

• Existing care homes

• Landlord references

• CQC registration

• CQC inspection history

• Registered manager information

• Insurance

• Proposed service model

• Funding arrangements

• Experience in the relevant care sector

CQC publishes information about registered providers and locations, including regulated activities, service types, specialisms and ratings information.

This can help form part of a landlord's due diligence, although CQC information should not replace independent financial and legal checks.

What Should Landlords Ask Care Home Operators?

Before progressing with a potential lease, ask the operator:

1. What type of care home will operate from the property?

2. How many residents are expected?

3. Will nursing care be provided?

4. What resident group will the home support?

5. What CQC registration is required?

6. Does the operator already run registered care homes?

7. What planning use is required?

8. What alterations are necessary?

9. Who will fund the refurbishment?

10. Who will be responsible for repairs?

11. How long is the proposed lease?

12. What rent can the operator pay?

13. Is a guarantor available?

14. What insurance will be maintained?

15. What happens if the operator stops using the property?

These questions can help establish whether the operator and property are a realistic match.

Prepare a Care Home Property Information Pack

Landlords can make their properties easier for operators to assess by preparing detailed information.

Include:

• Property address

• Floor plans

• Number of bedrooms

• Room dimensions

• Number of bathrooms

• Communal areas

• Kitchen details

• Garden information

• Parking

• Accessibility features

• EPC

• Planning history

• Existing use information

• Fire safety information

• Property condition

• Recent refurbishment

• Available certificates

• Availability date

• Proposed rent

• Lease expectations

The more accurate the information, the easier it is for an operator to determine whether the building is worth investigating.

What Rent Can a Care Home Operator Pay?

There is no standard rent for a care home property.

The commercial value depends on factors such as:

• Location

• Property size

• Number of bedrooms

• Existing use

• Condition

• Accessibility

• Required refurbishment

• Lease length

• Local demand

• Operator finances

• Intended care model

Landlords should assess the proposed rent alongside all other financial commitments.

For example, a seemingly attractive rent may need to be weighed against substantial refurbishment obligations or ongoing maintenance costs.

Consider the Operator's Business Model

A care home's ability to pay rent depends partly on the viability of its underlying service.

Landlords should understand:

• Who funds the care

• Whether residents are privately funded

• Whether the operator works with local authorities

• Whether NHS-related commissioning is involved

• How many residents the business expects to accommodate

• Whether the operator has experience running similar homes

The landlord does not need to run the operator's business, but understanding the proposed commercial structure can help with tenant due diligence.

What Happens If the Care Home Closes?

This should be addressed before the lease is signed.

The lease should establish what happens if:

• The operator loses its registration

• The service closes

• The operator wants to surrender the lease

• The property requires reinstatement

• Repairs are outstanding

• Adaptations remain

• Rent is unpaid

• The operator wants to assign the lease

These provisions can be particularly important where the property has been extensively adapted for care use.

How Fraser Bond Can Help Landlords

If you own a property and are searching for care home operators looking for properties, Fraser Bond can support the wider property process.

Depending on the project, Fraser Bond can assist with:

• Property sourcing

• Landlord advisory

• Property acquisition

• Lettings

• Property management

• Investment advisory

• Development consultancy

• Refurbishment planning

• Building works

• Contractor coordination

• Repairs

• Maintenance

• Compliance support

Fraser Bond can also help landlords assess the condition of a property and identify refurbishment or improvement requirements before approaching potential care home operators.

Specialist legal, planning, tax and regulatory advice should be obtained where required.

How to Prepare Your Property for Care Home Operators

A practical process can help landlords present a property effectively.

1. Assess the Building

Review the property's size, layout, condition, accessibility and location.

2. Establish the Planning Position

Check the existing lawful use and identify any potential planning requirements.

3. Identify the Right Operator

Target care home operators whose service model matches the property's characteristics.

4. Prepare Property Information

Create a detailed property pack with floor plans, photographs, measurements and relevant documents.

5. Identify Refurbishment Requirements

Obtain realistic quotations for any major work likely to be required.

6. Discuss the Proposed Lease

Agree rent, lease length, repairs, insurance, alterations and other responsibilities.

7. Complete Operator Due Diligence

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