...UK Operator Margins Squeezed: Since 2011, the UK's leveraged care-home sector has suffered from a reduction in local-authority fee rates in real terms. These revenue pressures are exacerbated by increasing costs and a nursing shortage in the UK. The funding gap may be further impaired by the introduction of a national living wage from April 2016. Position on the Acuity Care Spectrum: UK care-home operators are differentiated by their positioning on the dependency spectrum. Care homes at the higher end of the dependency spectrum like Voyage (`B' stable), with significant exposure to disability care, are relatively resistant to the funding cuts of local authorities. Care homes more at risk will be those catering for residents with less complex needs like Elli (Four Seasons Health Care, `CCC') and Care UK. Sponsors Appetite for UK Care Homes: Financial sponsor and leveraged-credit investor interest in the UK care-homes sector has traditionally been anchored by confidence in the sector's asset...
