Paragon Development Finance has provided funding to MACC Care Properties for the acquisition and development of a 71-bed care home in Birmingham. The brownfield site on Shaftmoor Lane in Hall Green will be developed into a 44,132 sq ft purpose-built facility, with an anticipated mature trading value exceeding £25 million upon completion.
The scheme will become MACC Care’s 21st care home. Steve Mountain, senior relationship director at Paragon, led the transaction alongside senior portfolio manager Darren Ellis and portfolio manager Olly Das.
Sector diversification strategy
The transaction forms part of Paragon Development Finance’s strategy to expand beyond residential development into sectors including build-to-rent, later living, purpose-built student accommodation, and care homes. This approach comes as property company insolvencies reach decade highs in the UK, prompting lenders to reassess sector exposure.
Demand for care home capacity is projected to increase as the UK’s population ages. According to ONS data, the number of people aged 65 and over is expected to rise significantly in coming decades, with the 85-and-above demographic growing at the fastest rate. Independent research indicates approximately 500,000 people currently reside in care homes across the UK.
Operator expansion plans
Dr Naz Nathani, chief executive of MACC Care Group, said the scheme reflects the operator’s delivery track record across development and operations. He noted the funding solution was structured to recognise the specific requirements of specialist care assets.
Mountain stated the deal required careful structuring over an extended period, working collaboratively with the borrower to deliver a facility aligned with the care home sector’s long-term fundamentals. The approach mirrors broader shifts in property financing, where estate agents reassess portal dependency amid rising costs and lenders seek sustainable sector opportunities.
The development adds to Birmingham’s growing care home infrastructure as providers respond to demographic pressures and increasing care complexity across the UK market.