A year to be proud of!
Nick Brown Valuations Director at Amberglobe, offers his views, thoughts and comments on the last 12 months activity in the childcare market from the perspective of sellers, buyers and as one of the most experienced and successful brokers in the childcare sector.
2011 has undoubtedly been a very interesting and testing year, it seems that everyone, in one way or another has been affected by the economic circumstances which we now find ourselves in. But once again the childcare sector has shown strong signs of resilience to factors beyond its control and activity from both buyers and sellers throughout 2011 has been very positive. In fact amberglobe has just reported that 2011 has been its best year to date in the total number of nursery transactions completed.
Why has this been a good year for completed sales of Nurseries
The answer to this lies in several contributory factors which start from the outset of selling. Correct, honest advice from day one is crucial. “We have numerous clients who have taken over a year before they feel they are ready to commit to the selling process, in this time we have helped them present their nursery in the best possible light and also have had time to prepare them for the oncoming process”.
Managing expectations is very important, often i speak with owners who have been advised values for their businesses which seem extremely high! this is not a new scenario but owners ‘beware’ it’s very easy to for agents and advisors to over promise and under deliver. Our view at amberglobe is simple when we advise we use methods similar to those of which will be used by anyone looking for funding.
As we all have come to realise the numbers of out and out cash buyers who require no funding or valuation have more or less become extinct. This is why we work closely with all the major valuation companies so we can provide evidence of transactions on a regular basis, this in the short and long term sets the bar for how they view values in different areas of the country.
My advice to owners would be, be very wary of anyone who seems to pluck a figure or value out of the air! Be sure to look and ask for comparable evidence, trends and even speak with former owners who have sold or used the services of that particular agent. At amberglobe we often tell sellers to see other agents as we are confident that after doing this and taking several opinions they will come back to the agent that has given the most sound, honest advice.
Who is actually buying?
The answer to this question varies to which part of the market your nursery positions itself. The demand for smaller leasehold and freehold nurseries is exceptionally strong, we believe this has been and is still being driven by first time buyers entering the market via redundancy from previous jobs etc or families looking to invest into their children, setting them up their first business in an industry which continues to do well.
Existing operators seem to be consolidating their current operations by acquiring competitors which add location and operational sense to nurseries which they already successfully run. Having an additional setting can help in the sharing of staff, cutting costs and give monopoly of sought after areas, which is crucial when trying to maximise the profitability of your current business. In addition to these buyers we are dealing with straight out investors who are looking for somewhere to put their money! Well run managed nurseries are a perfect solution. An example of this was earlier in the year we were approached by an investor returning to the country from sometime abroad, unsure where to put his money for the best return we helped he take his first steps into the childcare sector where he acquired a small group of 4 day nurseries and has subsequently gone on to add 2 more. So the good news is that there has been and still is, plenty of active purchasers looking at both small and large leasehold and freehold settings.
Fighting your corner!
It’s imperative that as a seller you look to get advice from a respected broker, you need to be confident that they will see your sale through, it could be said that getting an instruction to sell a nursery is the easy bit! Marketing in a highly confidential manner, liaising with bank valuers, finding finance for buyers and recommending good solicitors is all part of the package that any good broker should be looking to offer. http://www.amberglobe.co.uk/press.aspx
Thursday 29 March 2012
Amberglobe sells Petit Enfant Group of Day Nurseries in Oxfordshire
Amberglobe are pleased to announce that they have recently completed on the sale of the Petit Enfants Group of Day Nurseries which were based in Oxfordshire, Northamptonshire and Gloucestershire.
The group had a combined growing annual fee income of £1.9m and offered in total 387 registered places. This sale forms part of an initial relationship with both owners of the business, where several years ago we were able to introduce an investor into the business who then helped fund the acquisition of further day nurseries which has then culminated in this recent sale to the COOP childcare division.
The sale of the group had an asking price of £1.25m on a leasehold basis for the sale of the limited company on a cash free debt free basis. http://www.amberglobe.co.uk/basic_details.aspx?ref=2499
The group had a combined growing annual fee income of £1.9m and offered in total 387 registered places. This sale forms part of an initial relationship with both owners of the business, where several years ago we were able to introduce an investor into the business who then helped fund the acquisition of further day nurseries which has then culminated in this recent sale to the COOP childcare division.
The sale of the group had an asking price of £1.25m on a leasehold basis for the sale of the limited company on a cash free debt free basis. http://www.amberglobe.co.uk/basic_details.aspx?ref=2499
Children's Day Nursery for Sale in Wales
I have recently been instructed to sell an impressive Leasehold Children's Day Nursery which has a healthy annual fee income and would be a perfect opportunity for first time buyers. The setting is in North Wales and registered for 73 children. Please apply for additional information. http://www.amberglobe.co.uk/basic_details.aspx?ref=2542
Wednesday 21 March 2012
Children's Day Nursery Instructions
Been a flurry of high quality Children's Day Nurseries coming to the market. I have just been instructed on 2 extensive Freehold nurseries and 1 high turnover Leasehold setting all in the central belt of the country. www.amberglobe.co.uk
Thursday 15 March 2012
Signs of the Market Hotting Up
Today we did our fastest deal for many months. http://www.amberglobe.co.uk/sales.aspx Within only 3 weeks of listing a children's nursery for sale http://www.amberglobe.co.uk/search.aspx?T=Childcare we now have an accepted offer from a fully funded cash buyer.
I must say that we have noticed a major increase in enquiries for day nurseries. Four weeks ago we listed a nursery for sale in Surrey. Within the first week we had 25 viewing requests!! It then went to sealed bids and we now have an accepted offer above the asking price.
There's no question that day nurseries as a general sector have stood up very well over the last two years of recession conditions. Banks have continued to lend to buyers of nurseries and provided the quality of care is top notch, nurseries have continued to be very profitable businesses to own.
Check out all our other businesses for sale on http://www.amberglobe.co.uk/
I must say that we have noticed a major increase in enquiries for day nurseries. Four weeks ago we listed a nursery for sale in Surrey. Within the first week we had 25 viewing requests!! It then went to sealed bids and we now have an accepted offer above the asking price.
There's no question that day nurseries as a general sector have stood up very well over the last two years of recession conditions. Banks have continued to lend to buyers of nurseries and provided the quality of care is top notch, nurseries have continued to be very profitable businesses to own.
Check out all our other businesses for sale on http://www.amberglobe.co.uk/
Wednesday 14 March 2012
Weathering the Storm
In Utopian terms it’s better to be safe than sorry, however in the current financial climate it may not be possible to be 100% prepared for all eventualities.
However some practical steps are outlined below which will assist you in being pro-active rather than reactive:-
• Always have a plan B – the worst can happen
• The liquidity preference theory - manage your cash flow.
• Make the bank manager your new best friend - keep them abreast of your current situation.
• Get up to speed with tax - question what can be done to improve tax cash flow and ease payments
• Price correctly - don't have a knee-jerk reaction to the market.
• Review your terms and conditions - What happens if you deliver products to a customer who closes down before paying you? What terms do you have in place to limit your liability if there are problems? On what grounds can the contract be terminated?
• Manage your Debt Collection
• Your people - Your people are your biggest asset, but also during times of downturn unfortunately also often your biggest area of cost. Have you complied with legislation in respects of contracts for your employees? Do you know their key terms of employment? If you have to deal with redundancy, do you understand the process?
If you are looking for sound, practical, commercial legal advice at excellent prices then please contact us at ://www.amberglobelegal.com/
However some practical steps are outlined below which will assist you in being pro-active rather than reactive:-
• Always have a plan B – the worst can happen
• The liquidity preference theory - manage your cash flow.
• Make the bank manager your new best friend - keep them abreast of your current situation.
• Get up to speed with tax - question what can be done to improve tax cash flow and ease payments
• Price correctly - don't have a knee-jerk reaction to the market.
• Review your terms and conditions - What happens if you deliver products to a customer who closes down before paying you? What terms do you have in place to limit your liability if there are problems? On what grounds can the contract be terminated?
• Manage your Debt Collection
• Your people - Your people are your biggest asset, but also during times of downturn unfortunately also often your biggest area of cost. Have you complied with legislation in respects of contracts for your employees? Do you know their key terms of employment? If you have to deal with redundancy, do you understand the process?
If you are looking for sound, practical, commercial legal advice at excellent prices then please contact us at ://www.amberglobelegal.com/
Friday 2 March 2012
FEBRUARY MARKET REPORT
We are seeing definite signs of improvement in the market and last month we had the highest number of viewings of our businesses that we have had for two years. Maybe it’s the spring weather but I am also feeling there’s more optimism about and certainly there seems to be more activity on the high street.
http://www.amberglobe.co.uk/search.aspx?REF=-1&K=-1&L=-1&C=-1&T=-1
Because we see any change in activity so long before it is turned into a statistic and a recorded sale http://www.amberglobe.co.uk/sales.aspx I would expect to see the announcement in April of Government statistics of activity in the services and property sectors to record signs of improvement. That will hopefully have a snowballing effect. We are not however seeing activity equal price increases but rather a reflection of vendor expectations and buyer offers becoming more aligned.
Please check out all our businesses for sale at http://www.amberglobe.co.uk/
Without wishing to bang on, I would again remind you of the necessity to have an Energy Performance Certificate if you are selling a freehold or leasehold property. We have heard nothing further from the Department for Communities & Local Government and can only assume that the changes to the scheme are still happening on the 6th April. Do please call us 0800 707 6370 if you want to discuss it or need more information.
Finally, I am also delighted to announce the establishment of http://www.amberglobelegal.com/ which is a law firm that can provide buyers and sellers of businesses with a commercial conveyancing service at very significantly lower costs than other solicitors. Not only will we better any competitor's written quote but we also operate on a No Sale No Fee basis. Please call us today on 0800 5677147 for a quote http://amberglobelegal.com/quote.php or email quotes@amberglobelegal.com
http://www.amberglobe.co.uk/search.aspx?REF=-1&K=-1&L=-1&C=-1&T=-1
Because we see any change in activity so long before it is turned into a statistic and a recorded sale http://www.amberglobe.co.uk/sales.aspx I would expect to see the announcement in April of Government statistics of activity in the services and property sectors to record signs of improvement. That will hopefully have a snowballing effect. We are not however seeing activity equal price increases but rather a reflection of vendor expectations and buyer offers becoming more aligned.
Please check out all our businesses for sale at http://www.amberglobe.co.uk/
Without wishing to bang on, I would again remind you of the necessity to have an Energy Performance Certificate if you are selling a freehold or leasehold property. We have heard nothing further from the Department for Communities & Local Government and can only assume that the changes to the scheme are still happening on the 6th April. Do please call us 0800 707 6370 if you want to discuss it or need more information.
Finally, I am also delighted to announce the establishment of http://www.amberglobelegal.com/ which is a law firm that can provide buyers and sellers of businesses with a commercial conveyancing service at very significantly lower costs than other solicitors. Not only will we better any competitor's written quote but we also operate on a No Sale No Fee basis. Please call us today on 0800 5677147 for a quote http://amberglobelegal.com/quote.php or email quotes@amberglobelegal.com
CHANGES TO REGULATIONS FOR COMMERCIAL EPCs
Please find below the text of a Guidance Note issued on 25.1.12 by the Department of Communities & Local Government:
CHANGES TO THE ENERGY PERFORMANCE OF BUILDINGS (CERTIFICATES AND INSPECTIONS) (ENGLAND AND WALES) REGULATIONS 2007 (THE EPB REGULATIONS)
1. Summary of the changes to the EPB Regulations
The changes to the EPB Regulations can be summarised as follows:
the changes will extend the current requirements to commission an EPC that apply to residential buildings to all residential and non residential buildings when sold or rented out;
the requirements for the provision of an EPC with written particulars will be extended to all buildings sold or rented out and the option to attach the asset rating will be removed. The requirement will only extend to the first page of the EPC (the EPC consists of two pages, accompanied by four pages of recommendations); and
the requirement for the statutory lodgement of air conditioning inspection reports onto the central EPC Register.
The following summary details the main changes that will be made in relation to EPCs.
2. Commissioning an EPC before marketing
A number of changes will be made to regulation 5A of the EPB Regulations. In general, the onus remains on the ‘relevant person’ (i.e. the seller or landlord) to commission an EPC before marketing. The main changes are as follows:
the duty to commission an EPC before marketing will be extended to the sale and rent of residential and non-residential buildings;
the current 28 day period within which an EPC is to be secured using ‘reasonable efforts’ will be reduced to 7 days;
if after that 7 day period the EPC has not been secured the relevant person will have a further 21 days in which to do so.
3. Power to Require the Production of Documents
Trading Standards Officers (TSOs) currently have the power to require the ’relevant person’ (i.e. the seller or landlord) to produce copies of the EPC for inspection and to take copies if necessary. The power to require the production of documents will be extended to include persons acting on behalf of the seller or landlord - e.g. estate agents and letting agents. This means, for example, that TSOs will be authorised to require estate agents to produce evidence showing that an EPC has been commissioned where they are marketing a building without one.
4 Clarifying when an EPC is required
This technical amendment to Regulation 5 is intended to remove the erroneous belief that the provision of the EPC can be delayed until shortly before the parties enter into a contract for sale or rent. This will be achieved by deleting the words “before entering into a contract to sell or rent the building or, if sooner” in Regulation 5(2)(b) of the EPB Regulations.
5. Consequential changes
A number of consequential changes will be made to enable TSOs to enforce the new duties.
6. EPC Information in Written Particulars
Currently, for residential sales only, the relevant person or his agent is under a duty to either attach the EPC to written particulars or include the asset rating on those particulars. The amendments will require the EPC to be attached to written particulars in relation to buildings sold or rented out. The option to include the asset rating will no longer apply.
The existing definition of ‘written particulars’ will be expanded to ensure that particulars produced for rented out buildings and commercial properties are captured by the new requirements.
As an exception to this requirement, provision is made to allow the person subject to the duty to provide the written particulars to omit the address of the building from a copy of the EPC where the address has been omitted from those particulars.
7. Statutory lodgement of air conditioning inspection reports
The requirement to lodge air conditioning inspection reports on the central Non Domestic EPC Register will become a statutory requirement, replacing the current voluntary approach.
8. Commencement
The amended Regulations will come into force on 6 April 2012. Further information will be issued shortly.
DCLG
25 January 2012
http://www.amberglobe.co.uk/
CHANGES TO THE ENERGY PERFORMANCE OF BUILDINGS (CERTIFICATES AND INSPECTIONS) (ENGLAND AND WALES) REGULATIONS 2007 (THE EPB REGULATIONS)
1. Summary of the changes to the EPB Regulations
The changes to the EPB Regulations can be summarised as follows:
the changes will extend the current requirements to commission an EPC that apply to residential buildings to all residential and non residential buildings when sold or rented out;
the requirements for the provision of an EPC with written particulars will be extended to all buildings sold or rented out and the option to attach the asset rating will be removed. The requirement will only extend to the first page of the EPC (the EPC consists of two pages, accompanied by four pages of recommendations); and
the requirement for the statutory lodgement of air conditioning inspection reports onto the central EPC Register.
The following summary details the main changes that will be made in relation to EPCs.
2. Commissioning an EPC before marketing
A number of changes will be made to regulation 5A of the EPB Regulations. In general, the onus remains on the ‘relevant person’ (i.e. the seller or landlord) to commission an EPC before marketing. The main changes are as follows:
the duty to commission an EPC before marketing will be extended to the sale and rent of residential and non-residential buildings;
the current 28 day period within which an EPC is to be secured using ‘reasonable efforts’ will be reduced to 7 days;
if after that 7 day period the EPC has not been secured the relevant person will have a further 21 days in which to do so.
3. Power to Require the Production of Documents
Trading Standards Officers (TSOs) currently have the power to require the ’relevant person’ (i.e. the seller or landlord) to produce copies of the EPC for inspection and to take copies if necessary. The power to require the production of documents will be extended to include persons acting on behalf of the seller or landlord - e.g. estate agents and letting agents. This means, for example, that TSOs will be authorised to require estate agents to produce evidence showing that an EPC has been commissioned where they are marketing a building without one.
4 Clarifying when an EPC is required
This technical amendment to Regulation 5 is intended to remove the erroneous belief that the provision of the EPC can be delayed until shortly before the parties enter into a contract for sale or rent. This will be achieved by deleting the words “before entering into a contract to sell or rent the building or, if sooner” in Regulation 5(2)(b) of the EPB Regulations.
5. Consequential changes
A number of consequential changes will be made to enable TSOs to enforce the new duties.
6. EPC Information in Written Particulars
Currently, for residential sales only, the relevant person or his agent is under a duty to either attach the EPC to written particulars or include the asset rating on those particulars. The amendments will require the EPC to be attached to written particulars in relation to buildings sold or rented out. The option to include the asset rating will no longer apply.
The existing definition of ‘written particulars’ will be expanded to ensure that particulars produced for rented out buildings and commercial properties are captured by the new requirements.
As an exception to this requirement, provision is made to allow the person subject to the duty to provide the written particulars to omit the address of the building from a copy of the EPC where the address has been omitted from those particulars.
7. Statutory lodgement of air conditioning inspection reports
The requirement to lodge air conditioning inspection reports on the central Non Domestic EPC Register will become a statutory requirement, replacing the current voluntary approach.
8. Commencement
The amended Regulations will come into force on 6 April 2012. Further information will be issued shortly.
DCLG
25 January 2012
http://www.amberglobe.co.uk/
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