"This product launch is further evidence of our focus on building long-term, strategic partnerships with developers to ensure they have the right finance to deliver and thrive"
- Neal Moy - Paragon Bank
Paragon Development Finance has unveiled a new funding product for the development of care homes, offering finance for SME developers with terms from 20 to 36 months and a minimum loan size of £10 million.
The new facility is designed for experienced care home developers and operators, enabling them to deliver high-quality, specialist accommodation across the UK. The launch comes as demand for modern, purpose-built care facilities continues to rise and Paragon strengthens its support for SME developers in an evolving market.
Recent research highlights the urgency of this need. ONS data released earlier this year revealed that England is projected to see an average increase of 242,000 households per year from 2022 to 2032. The fastest growth will be among households where the oldest person is aged 85 and over, expected to rise by 42.3%, most of which will be single-person households. This demographic shift is set to drive demand for smaller, accessible homes and specialist later living accommodation, including care homes, retirement housing and age-friendly communities.
This announcement follows Paragon's expansion into other new markets, including later living, build-to-rent and purpose-built student accommodation, a sector in which the division has now completed around 20 deals. It also comes shortly after Paragon increased its maximum loan size from £35 million to £60 million, a testament to its confidence in the UK's development sector.
"Our new care home product underlines our commitment to supporting SMEs, experienced operators and the UK's expanding care infrastructure," said Neal Moy, managing director of development finance at Paragon Bank. "Over half of our deals are made with repeat customers, reflecting our customer-centric ethos. This product launch is further evidence of our focus on building long-term, strategic partnerships with developers to ensure they have the right finance to deliver and thrive."
"Care home schemes are complex and capital-intensive, requiring a lender that understands both the construction and operational challenges," said Adrian Reeves, senior relationship director, who leads on Paragon Bank's care home product proposition. "By backing ambitious and skilled developers, we're helping to deliver best-in-class care environments for communities across the country – demand for which will continue to grow for years to come."
