The Leicestershire Care Market: What the Data Shows
A Strong Self-Funder Market and Growing Bed Capacity to Serve it
Leicestershire is among the strongest self-funded older-adult care-home markets in the East Midlands. Approximately fifty per cent of all older adult care home beds in Leicestershire have been funded by self-funders; the proportion is much greater than in many similar counties. New entrants to the market (new homes) are deliberately designed to serve self-funders, and the County Council’s latest data show older adult bed stock increasing by thirteen per cent between June 2021 and June 2024. Those increases reflect what builders see: Leicestershire has both the demographic and financial resources to provide quality, affordable, purpose-designed accommodation. New buildings are generally larger and more modern than existing ones, reflecting a UK-wide trend toward larger, purpose-designed facilities for sixty-plus-year-olds.
Pressure Points and Opportunities in Nursing Care
The nursing care situation is more problematic. Since 2014, Leicester City has lost forty per cent of its nursing beds. Six nursing homes have closed; four others were de-registered for nursing care without replacement. This has been identified as a major problem by the City Council’s Market Sustainability Plan. Therefore, nursing placement availability is under considerable pressure. Specifically, there are shortages of nursing beds suitable for individuals who require complex care, dementia nursing, and hospital discharge. Residential care providers with nursing capability fill their beds faster than residential-only care providers. Therefore, whether a new facility should include some level of nursing care will affect the viability assessment of the development.
Occupancy and Available Beds
While average occupancy levels in Leicestershire may be reported as eighty-three per cent, which may suggest the market is relatively full, only approximately 750 beds across the county are currently vacant. This represents about fifteen per cent of the total number of beds available. There are several reasons why so many beds are unavailable. Firstly, many beds are reserved for patients requiring either NHS funding or complex care. Secondly, numerous homes are operating below their registered capacity due to staffing difficulties. Finally, many other operators manage waiting lists. Thus, while occupancy appears high, Leicestershire is essentially a very tight market, especially in nursing care.
Hospital Discharge Pressures and Dementia Shortages
The need to rapidly accept hospital discharge placements is a continuous concern for all parties involved in the Leicester, Leicestershire and Rutland Health Economy. While the County Council works closely with Health Partners to manage hospital discharges, it continues to face significant demand for beds that can accept urgent, high-acuity placements. In general, a new build or an extension with suitable clinical equipment — i.e., Nurse Call Systems, Assisted Bathrooms, etc., that is capable of accommodating rapid hospital discharge placements can generate additional NHS funding to supplement self-funder fees.
Additionally, the County Council has highlighted that there is now a specific shortage of dementia beds, although most care homes are reporting difficulty finding a place for individuals with even low-level dementia needs. As a consequence, many families are having to pay for specialist dementia care, rather than continuing to fund them within less expensive local authority-funded or non-authority-funded (i.e. self-funder) residential care settings. Thus, building a dementia-capable new build or extension would address a genuine gap in the local market.
Development Economics and Location
As previously stated, Leicestershire is centrally located in England, close to major motorways, including the M1 and M69, and connected via the A46. In addition, travel times from Leicester to London St Pancras International Station are under one and a quarter hours, providing access to all parts of the country. Accessibility matters for staff recruitment, visiting relatives/friends and ensuring continuity of supply lines throughout the construction period. Finally, land prices in Leicestershire are considerably lower than in areas such as the South East, thereby reducing overall development costs per unit and improving development viability.
