Tonkiss, the FTSE 250 group’s chief executive, thinks there are positives to
come out of the pandemic.
He tells Property Week why
he thinks now is the time for the sector to capitalise on the new found
political importance and what he thinks government and industry need to do to
drive the recovery not just of the senior living sector but the whole housing
has McCarthy & Stone responded to Covid-19 in its retirement communities?
really quite concerned at the beginning of March that people over 65 would be
locked down and the rest of the population would carry on.
quite relieved when the prime minister put the entire country into lockdown on
23 March, but we had already put plans in place in early March: a provisional
lockdown and new control measures.
incredibly impressed by, and am proud of, how the business has responded to the
outbreak. Since I took over as chief executive, I’ve been reminding everybody
that while we are the UK’s leading retirement housebuilder, we’re much more
than a bricks-and-mortar housebuilder, which has been my narrative for the past
18 months to two years. We have 1,600 staff looking after 20,000 customers,
with all the retirement living and extra care services that we provide.
has the pandemic impacted you operationally?
obviously done all the work to provide care and PPE equipment. There were some
early weeks where that was challenging, around late March/early April, but we
got an entire procurement team out in the field to buy PPE. We had five to
six people working full-time on it.
down and furloughed all our production and sales staff, but more than 500 of
our employees have provided a buddying service, including my sons here at home.
There are new opportunities and there is a
significant unmet demand
vulnerable out of 3,000 customers, about 1,700 specifically, asked for extra
support, so we delivered meal services, home delivery from shops and also
medical supplies. We’ve learnt and developed a whole new set of service
standards and models off the back of this.
has your current financial position been?
the government has provided some really important short-term liquidity
responses. The Covid Corporate Financing Facility (CCFF) [from the Bank of
England], which we qualified for formally on Monday [1 June], has allowed us to
invest confidently in restocking our building permits again.
do you think the government should do post-Covid-19?
government first and foremost needs to do is intervene and stimulate the
general housing market, not just senior housing. The easiest way to
do that is through stamp duty relief. I think that needs to be on the
table for the government in July.
like stamp duty reform for retirees downsizing, and the housing minister has
acknowledged that this would be a really smart thing to do to benefit the
housing market. When customers move out of their homes to one of ours, it
allows two-and-a-half further moves in the ageing chain.
Later living: The Wickets in Settle, Yorkshire, is one
of McCarthy & Stone’s retirement schemes
longer term, we need planning policy here and specific planning requirements
for older people and retirement communities. We and the Associated Retirement
Community Operators (ARCO) talk positively about the need to build more and to
facilitate that through planning requirements and planning policy.
spent a lot of time over the past 18 months or so talking to care ministers
about the social care system to provide this third way, which we call
independent retirement living. You have your own front door, your own
independence, with the care and support you need. We cover an important gap,
but it’s reliant on the adult social care system working effectively.
can the senior living sector move forward following the pandemic?
new opportunities and there is a significant unmet demand that we can
facilitate, if we’ve got the right government policy and supply-side support
around planning in particular.
streets are going to change immeasurably in the next three to five years. They
were going to change anyway, and Covid-19 is going to accelerate that.
this kind of change looks like in 2025, we need to invest in and develop
communities. Not the big cities such as Manchester and Birmingham – I’m talking
about the small towns that will struggle if we don’t bring in investment to the
that is going to be our biggest opportunity, quite frankly. There’s a role that
retirement villages in the out-of-town setting can play.
has your strategy as a business evolved?
back to 18 months ago when I took over as chief executive, we did some really
important things in terms of how to reset the strategy of the business.
them was providing new forms of tenure – to allow customers to either buy
outright, rent and/or do a shared ownership scheme. That went really well over
the past 12 to 15 months. We launched it this time last year.
I think we are still going to have a tough few months
and quarters ahead
was to set up investment vehicles for those rental-like assets, and we were
right on the cusp of securing that deal before Covid-19 hit. We still will do
that, but we may need to think again about how we do it.
are your expectations for the sector in the next 12 months?
we are still going to have a tough few months and quarters ahead. While we’re
all getting back to some degree of relative normality, from going out in the
garden to talking with friends and family and so on, we’re a long way from
being out of this pandemic.
urge caution to policymakers and business leaders, so that we don’t forget the
things we’ve gone through in the past three months and say: “OK, it’s all