NHP, the largest landlord to struggling care homes firm Southern Cross, is to set up a new company to take control of 249 of the homes it owns.
It has retained £14m of due interest payments and will make a similar retention in October to use as working capital to continue to run the homes.
NHP will partner with its adviser, turnaround company Court Cavendish, to form a new operating company that will bring the property portfolio to a “firm financial footing”.
The new company is expected to be created in October, four months after Southern Cross and its landlords jointly announced they would begin trying to find ways to tackle the severe financial problems at the business.
The joint venture, of which Court Cavendish will be a stakeholder, will rent and operate out of the properties that NHP currently leases to Southern Cross.
Paul Thompson, NHP director, said: “We recognise the great concern and uncertainty caused by recent events. We are committed to doing all that it takes to ensure continuity of care. Lessons have to be taken on board from what happened at Southern Cross.”
Court Cavendish is chaired by Dr Chai Patel, who has some 20 years’ leadership experience in the health and social care sector.
Patel said: “I am confident that the necessary funding is in place to launch a new company that will not suffer from the same problems of the past.”
Southern Cross, which runs 752 homes, announced its closure earlier this month, after struggling to cope with rising rent payments.
joanna.bourke@estatesgazette.com
