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Private investors pledge £3.3bn to build ‘hundreds’ of primary care premises

Three private companies have said they are investing £3.3bn into primary care premises, claiming they could build 750 state of the art buildings to ‘kick-start the next generation’ of primary care premises over the next five years.

The consortium of premises investors – Assura plc, Primary Health Properties, and Octopus Healthcare (which advises investor MedicX Fund) – says it would fund this by charging rent of ‘less than £200m a year’ to NHS bodies, which is says would unlock savings of £270m through reducing secondary care activity.

But BMA leaders were sceptical about where the private sector would find returns from such a sizeable investment and whether the NHS would be able to pay the recurring costs.

The consortium said investment would focus on ‘Sustainability and Transformation Partnership’ (STP) areas where NHS bodies and councils are collaborating to move care out of hospitals and into the community.

The British Property Federation – which includes Assura and PHP – estimated that the NHS could save £270m through the use of ‘modern, multi-functional premises’ by reducing non-urgent demand at A&Es, relieving pressure on walk-in centres and improved outcomes by increasing access for the elderly.

It adds: ‘This investment would require less than £200m of rent per annum from the NHS – rent which would be set for the NHS independently, at market rate, by District Valuer Services’.

A spokesperson for the consortium told Pulse that it would also be up to the NHS to decide if this would be in addition to any existing premises, or if it would replace those no longer fit for purpose.

Talks between the consortium and the NHS and regional STPs are underway, but the government estates tsar Sir Robert Naylor welcomed the pledge saying: ‘It is encouraging to see the private sector step forward to play their part in meeting the recommendations set out in my review published earlier this year – with a credible plan and offer on the table for the NHS and Government to respond to.’

Jonathan Murphy, CEO of Assura plc, said: ‘There’s enormous potential to help STPs move forward on their considerable estates challenges… It is going to take significant funding, expertise and experience to support GPs with the premises on which transformation can be built, and we’re ready to help.’

However,  Dr David Wrigley, BMA deputy president and a co-author of the book NHS for Sale, warned that these investors will expect a return on their investment. He said: ‘They seem to say they will use the £200mn of cost rent that the buildings attract but this must mean other premises will close down.

‘Private firms would never invest so much money if there wasn’t a big chunk of profit to be made.’

A spokesperson for the group told Pulse that it would manage maintenance on the buildings and everything else would be up to the tenants, but the rental and charging would be decided in negotiations with the NHS.