GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
GLOBAL                          RATED AS EXCELLENT

CHILDCARE
PROPERTY
REPORT
UK EDITION
2019

THE COMPLETE CHILDCARE BROKER
GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
GLOBAL CHILDCARE PROPERTY REPORT UK EDITION - 2019

UK OVERVIEW
        by PAUL J MILLER
        Chief Executive Officer
                                                            2019 CHILDCARE SECTOR UPDATE

UK Childcare Market: A Golden                               2018 was a year in which the UK Childcare         As we look ahead to 2019 our confidence
                                                            property market continued to excel despite        is buoyed by record levels of pipeline
Window of Opportunity for those                             the backdrop of an uncertain economy.             transactions which are expected to
wishing to sell their childcare                             The Redwoods Dowling Kerr Childcare               complete in 2019. Our KPI levels are strong
                                                            team achieved a significant milestone,            with high quality UK and International
businesses.                                                 completing in excess of 100 transactions.         buyers approaching us on a weekly basis
                                                                                                              with a strong appetite to secure new
                                                            In addition to completing over 100                childcare acquisitions.
                                                            childcare deals, the team also set new
                                                            records for the number of settings sold           The Childcare market is buoyant at
                                                            and the total sales transaction values            present and this is impacting positively on
                                                            achieved. One of the significant trends was       multiples and sales values not only in key
                                                            a 10% increase in the mix of the volume of        areas and regions, but also further afield in
                                                            freehold transactions we completed when           less traditional hotspots. The best results
                                                            compared to 2017. This demonstrates a             are being achieved by sellers who follow
                                                            continued desire by acquirers to secure           a tried and tested process with a proven
                                                            freehold assets and illustrates an availability   Childcare sector specialist.
                                                            of liquidity from lenders in securing
                                                            the transactions. In 2018 we witnessed            Whilst several Corporate deals were
                                                            diversification away from the big 6 lenders       mooted in 2018 none were transacted and
                                                            with a number of childcare deals being            regional Group sales took centre stage. We
                                                            funded by “challenger” banks.                     enjoyed our best year ever on the sale of

                                                                                                                                  3
                                                     Freehold sales                       Average places per                  Average time
                                                     now accounted for                    freehold sold settings              taken to sell

                                                     46.25%
                                                                                          has risen from 61                   a freehold
                                                                                          places to                           nursery has

                                                                                          73           places                 reduced by
                                                     in 2018 compared to 36%
                                                     in 2017, 10% increase                                                    months
                                                                                                                               in the second half of
                                                                                                                               2018
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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
SOLD

                                                                                                                                          Mains Farm House Nursery
                                                                                                                                          County Durham

Groups and congratulations to all parties       2019 has commenced against a backdrop           that those challenges will be met and     A school teacher is looking forward to
on the completion of Little Acorns in Bristol   of political and economic uncertainty as        overcome.                                 running her first children’s day nursery
(Project Portugal). This was truly a win/       a result of the impending Brexit position.                                                after the sale of Mains Farm House
win deal for everyone and a full case study     Whilst we may be only a few short months        We expect demand to continue in 2019      Nursery in County Durham.
of this transaction is included within this     from theoretically leaving the European         with the emergence of more overseas
                                                                                                                                          First-time buyer, Lynsey Roy, beat 10 other
brochure.                                       Union there is a strong possibility that it     buyers. We also expect to see Corporate
                                                                                                                                          interested parties in a bid to acquire the
                                                may take far longer for the position to be      deals as well as regional deals and the   charming children’s day nursery in
However, it was not just regional sales         resolved.                                       emergence of new entrants who will        Chester-le-Street.
that were buoyant but also growing local                                                        quickly become regional and national
operators and single/dual site settings.        Consequently, all UK businesses will            players.                                  Mains Farm House Nursery is a thriving
Demand for Childcare businesses ranged          need to operate within this framework                                                     childcare business with capacity for 34
across the full spectrum of buyers              of uncertainty as well as meeting the           There are undoubtedly challenges          children aged 6 weeks to 5-years-old. It was
(Corporates, Private Equity, Regional           other challenges facing the childcare and       ahead for the Childcare sector, but we    rated as ‘Outstanding’ by Ofsted in October
and Local Groups, Growing Operators,            education sectors.                              are confident that 2019 will be another   2017 and enjoys an excellent reputation for
Experienced First Time Buyers and High                                                          positive year.                            the quality of childcare provided.
Net Worth Investors), with the emergence        Cost pressures, availability of good quality
                                                                                                                                          In a joint testimonial, the owners of Mains
of more overseas buyers from both Europe        staff and trainees, rising employment costs                                               Farm House Nursery, Maureen Sheekey
and Asia. Redwoods Dowling Kerr have            and 30 hours funding will continue to be                                                  and Lianne Dixon said:
been extremely active in encouraging            challenges for the sector in the coming
inward investment into the UK having            year and may well impact margins in                                                       “I would like to thank Karrina Lee at
undertaken a number of initiatives in           certain areas. However due to the resilience                                               Redwoods Dowling Kerr for all her support
2018which we expect to come to fruition         and proactive nature of childcare operators                                                over the past few years, especially during
in 2019.                                        and the quality of early years provision that                                              the last 6 months. We couldn’t have done it
                                                is delivered by the sector we have no doubt                                                without you.”

OVERSEAS INVESTMENT IS BEING DRIVEN
BY A COMBINATION OF THE EXCELLENT
REPUTATION OF THE UK CHILDCARE SECTOR
AND THE GOOD VALUE REPRESENTED BY
THE CURRENT WEAKNESS OF STERLING.

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
GLOBAL CHILDCARE PROPERTY REPORT UK EDITION - 2019

INTERNATIONAL BUYER REACH
        by ANDREW K STEEN
        Sales and Marketing Director

A warm welcome to 2019, a                     At Redwoods Dowling Kerr we have been        Buyer requirements for Childcare              East is reducing as investors seek to realise
                                              preparing for Brexit from the moment         opportunities remain relatively unchanged     additional value from acquiring in the
year which offers a significant               which Article 50 was triggered. Our          in 2019, the one slight variation is that     Northern Powerhouse territory and also
mix of business opportunities                 strategy of promoting UK interests to        corporate operators are now considering       the Bristol/M4 corridor area. Interest is also
                                              domestic and international buyers has        opportunities with an EBITDA in excess        evident for the Scottish central corridor,
and political uncertainty which               paid dividends in 2018 with a number of      of £150k. This is predominately due to the    anchored by Edinburgh and Glasgow.
is predominately driven by the                market leading international transactions    supply/demand effect which exists in the
                                              brokered by Redwoods Dowling Kerr.           childcare brokerage market.                   In 2019 we are seeking to expand our
UK’s current Brexit position. I say
                                                                                                                                         global reach with the addition of a China
“current” as with two months until            In 2018 we launched our international                                                      based seminar where we will reach
                                              buyer seminar program which served
                                                                                           Introducing… International                    out directly to the Chinese investment
the UK is expected to resign its EU
                                              to spread the message that the UK is         Seminar Programs 2019                         community to facilitate the brokerage
membership we are still unaware               fully open for business and is rife with                                                   of our opportunities which suit Chinese
of what a post Brexit UK will look            investment opportunities, particularly in    During 2018 the directors of Redwoods         international investment.
                                              the Healthcare, Childcare & Education        Dowling Kerr conducted International
like.                                         and Leisure markets. As a result of these                                                  Our seminar program is due to take place
                                                                                           Seminars which took place in Dubai. The
                                              seminars we are now in a mandated            seminars took place with the intention of     in March, May, September and October
                                              position to match UK opportunities           promoting our UK sale opportunities and       in 2019. If you are interested in finding out
                                              with international buyers who are            also enabled the directors to deal with any   more then please contact us directly to
                                              located throughout the global business       concerns/objections which the attendees       register your interest.
                                              community. We look forward to 2019           had in relation to investing in the UK.
                                              with excitement as we announce new
                                                                                                                                         TYPICAL BUYER CRITERIA INCLUDES:
                                              international seminars in the Middle East    We are delighted to announce that we
                                              and China. As our global reach expands we    received overwhelming feedback that the       1) Strong, sustainable profit levels
                                              are very excited to work on new projects     UK remains an attractive investment target
                                              which will serve to deliver increased exit   and that appetite exists for profitable       2) Management team ran with strong
                                              values to our clients.                       Childcare opportunities. It was also noted        performance statistics
                                                                                           that the trend towards London & the South
                                                                                                                                         3) Sites with profit levels in excess of
                                                                                                                                            £150k EBITDA

                                                                                                                                         4) Sites with registration levels
                                                                                                                                             in excess of 50

                                                                                                                                         5) Upward profit trend with strong local
                                                                                                                                            demographics

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
Sweden

                Canada                         Germany

                                      France

                                   Spain
                    United
                    States
                                                                                               China

                                                                   Saudi
                                                                   Arabia              India
                                                                             United
                                                                              Arab
                                                                            Emirates
                                                                                                          Philippines

                                                                                                       Australia
Highlighted countries                                     South
                                                          Africa
demonstrate markets of
significant buyer interest

Source: www.BusinessBuyers.co.uk

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
GLOBAL CHILDCARE PROPERTY REPORT UK EDITION - 2019

OFFER ACCEPTED? – NOW IT’S TIME TO DELIVER
        by JENNA CALDWELL
        Director of Childcare & Education

Many people may think                         At the start of our Corporate Sales Process,      Once an offer has been agreed the                and frustration to all parties within the
                                              we are actively mapping our way to                Due Diligence process will commence.             transaction.
that generating an                            achieve the right results for our clients. This   Thankfully we prepare our clients in
acceptable offer is the                       begins with researching current buyers            advance of what to expect at this stage in       “As part of their preparations for a sale, it is
                                              in the market who we feel would be the            addition to offering examples of standard        very important for sellers to consider the
toughest part of any deal                     perfect buyer. This does not always come          due diligence questionnaires as we               team of advisers they need. Key to this are
and where a broker’s job                      down to who we believe will pay the best          realise it can look very daunting. We work       a good agent, lawyer and accountant. They
                                              price, it depends on what our clients value       alongside our clients in this preparation        should have a successful track record for
ends. For some brokers this                   the most and want to achieve out of the           and will provide all of the data that we         comparable sales and a commercial and
is the case but for us this                   sale.                                             hold to the solicitor’s data room so that our    pragmatic approach. On Project Portugal,
                                                                                                clients are only collating the information       RDK were an integral part of the advisory
is only a small part of our                   In 2018 we brokered in excess of 100              that has not already been provided thus          team. I had regular calls with Jenna who
process.                                      childcare deals and each deal came with           reducing the workload for our clients. In        was instrumental in helping to resolve
                                              its own requirements which were relevant          December 2018 we completed the sale of           some of the commercial issues that arose.
                                              and personal to our clients. In each of           Project Portugal which was a group of 8          She had an impressive knowledge of the
                                              these deals we broker, we set out our             settings. A detailed case study is featured      sector and a great hands-on approach,
                                              ambitions with our clients and set out            later in this report which offers the vendors    often acting as a vital go-between for the
                                              a strategy to try and realise these, some         perspective on the deal process.                 sellers and buyer.”
                                              clients wish to retain family members
                                              working in the settings, others wish to           At this point having the right team of           Georgina Bryant Partner | Barcan+Kirby
                                              continue to receive beneficial fee rates for      advisors is crucial. We will refer our clients   LLP
                                              their close family. This is also the case when    to legal advisors who are specialists in
                                              we take an opportunity to market where            the childcare market and have a proven
                                              our clients own the freehold property             track record in completing childcare
                                              but choose to lease the premises to the           transactions. Each week we conduct
                                              purchaser.                                        deal update conference calls to ensure
                                                                                                that the deal is on the right track and is
                                              We work closely with our clients to match         progressing as agreed. In our experience
                                              them to the buyers who are able to deliver        a solicitor who has not been involved in
                                              on the client’s requirements and have a           childcare transactions will not have the
                                              track record of completing on deals in a          required childcare knowledge to create a
                                              timely manner.                                    smooth transaction and can cause delays

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
SOLD

                                                                                              BAMBINOS, A GROUP OF FOUR NURSERIES
                                                                                              SOLD TO INTERNATIONAL INVESTORS FROM
                                                                                              CHINA
                                                                                              Devon

Accounts                                       “I would highly recommend Redwoods             Redwoods Dowling Kerr is delighted to announce the sale of Bambinos, a group of four nurseries
                                               Dowling Kerr to anyone looking to sell their   based in Plymouth, Devon. The group of nurseries sold to international investors from China,
                                                                                              making it one of the first deals of its kind in the industry.
Accountants are also crucial within the sale   business. They provide a complete end to
process. We will request an introduction       end service which most other brokers do
                                                                                              The vendors, Mr and Mrs Lane were delighted to receive two offers from interested parties.
to our client’s accountant from the outset     not provide.”
                                                                                              After careful consideration, they decided to accept an offer from London Thames Capital,
so that we can work alongside them and
                                                                                              who were working on behalf of an overseas investor from China.
again help them to understand what will        Mr Arjuna – previous owner of
be required of them. This also removes the     Gingerbread Day Nursery
                                                                                              London Thames Capital is a renowned business consulting firm that specialises in the
need for our client to be the go between
                                                                                              education sector based in Mayfair, London. They hold strong relationships with associates
when they have the most important job          “RDK found us several potential buyers that
                                                                                              from China, with a vision to promote business collaboration between the UK and China.
still to do which is to remain running the     they knew would be quality buyers for us
                                                                                              Once communications between Redwoods Dowling Kerr and London Thames Capital
business throughout the sale process.          and although there were some unforeseen
                                                                                              were underway, it became clear that Bambinos Day Nursery was an ideal purchase for
                                               hiccups along the way, they always had our
                                                                                              their clients.
Throughout the sales process we are            best interest at heart and fought hard for
always on hand to drive the transaction        us to achieve the sale we wanted.”
                                                                                              Mr and Mrs Lane were more than happy to pass their legacy on to prestigious overseas
forward and to ensure that our clients
                                                                                              buyers, who in turn were delighted to have a foothold in the UK childcare market in the
needs are met. More often than not this        Mrs Edwards – previous owner of
                                                                                              form of an extremely strong nursery brand.
will mean being available 7 days a week        Childsplay of Liverpool
including evening and weekends but to do
                                                                                              The sellers, Mr and Mrs Lane commented on their experience saying that; “We would
the best by our clients we have to literally
                                                                                              like to thank you for your help along the way Sarah and for introducing us to the Chinese
live and breathe our clients’ experience.
                                                                                              investors. We wish them every success for the future with the Bambinos brand.”

                                                                                              The buyers commented on their experience saying that; “I would like to say a great
                                                                                              thank you for your help and patience during the long process, we would like to purchase
                                                                                              more through Redwoods Dowling Kerr in the future.”
OVERALL, WE DO FAR MORE THAN ADVERTISE A
BUSINESS FOR SALE, WE MAKE IT HAPPEN.

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
CASE STUDY: REDWOODS DOWLING KERR - 2019

PROJECT PORTUGAL LITTLE ACORNS & 100 ACRE
WOOD EIGHT NURSERY SETTINGS
WHEN THE OWNERS                            THE VENDORS’ PERSPECTIVE
OF TWO FLOURISHING
                                           Shaun Woodman was cycling in Portugal           Shaun and Lisa Woodman started with a          “We wanted to sell but didn’t know how to
CHILDCARE BUSINESSES                       in June 2018 when the call came through         single nursery site in 2004 and almost 14       go about it - whether the eight settings
WITH EIGHT NURSERY                         on his mobile - an offer to buy the             years later in partnership with James and       should be broken up and sold individually
SETTINGS DECIDED IT                        childcare group that he and his partners        Jude Evans had built up a portfolio of eight
                                                                                           settings across the South West, caring for
                                                                                                                                           or to sell as a group.
                                           had built up since 2004.
WAS THE RIGHT TIME TO                                                                      487 children with 160 employees.               “So although we weren’t in a fully saleable
SELL THEY CAME TO THE                      And it was more than the asking price.                                                          position with all the t’s crossed and i’s
BIGGEST PLAYERS IN THE                     Shaun remembers the moment vividly. In
                                                                                           Building the business                           dotted, we decided to go for it. We were
                                                                                                                                           confident in RDK - they had the right
MARKETPLACE - RDK.                         his own words, he was ‘dumbfounded’. It         Over the years they built up a successful       experience, the right people and the right
                                           marked the start of a process that would        nursery group offering excellent childcare      background to do the job.”
                                           end just six months later.                      provision and were ready to enjoy early
                                                                                           retirement however, they needed an exit        Saleable position
                                           “From the day we got the offer and for the      strategy. They needed to understand how
                                            next six months I was fixated on it - would    to make the business saleable and what         The initial process started with a detailed
                                            the buyers come back with a lower offer or     the process involved.                          meeting with an Associate Director during
                                            perhaps a counter offer? One day I thought                                                    which the fact-finding process of collating
                                            we’ll never get it completed and at other      In 2018 RDK contacted the owners asking        information and appraising the business
                                            times I felt more positive.                    whether they were interested in selling the    started.
                                                                                           group, especially during the exceptionally
                                           “Despite many twists and turns, it was relief   buoyant market conditions.                     Shaun added: “RDK’s appraisal was higher
                                            and sheer happiness when we completed                                                         than we expected which was a real
                                            on the price that we’d first agreed.           Shaun explained: “We knew that RDK was         surprise and very happy news.
                                            RDK’s help and support were invaluable         the biggest player in the childcare market
                                            throughout the whole process.”                 because we’d come across them before
                                                                                           when we were looking to buy nurseries.

                                           RDK’S HELP AND SUPPORT WERE INVALUABLE
                                           THROUGHOUT THE WHOLE PROCESS.

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
CASE STUDY: REDWOODS DOWLING KERR - 2019

PROJECT PORTUGAL LITTLE ACORNS & 100 ACRE
WOOD EIGHT NURSERY SETTINGS
                                           THE VENDORS’ PERSPECTIVE

                                           “It was clear that we’d undervalued our         “We had to continue to run the nurseries       After a hectic six months the sale of the
                                            businesses even though I thought we             as though they were ours as they still        businesses was completed in December
                                            knew the sector pretty well and what            were but whilst also dealing with the sale    2018.
                                            nurseries were worth!                           process.”
                                                                                                                                          Shaun added: “We feel that both seller and
                                           “Then, just three days after the corporate      RDK helped the owners source a local           buyer got a good deal and everyone was
                                            sales process had commenced, we had            solicitor with the expertise and experience    happy with the outcome.
                                            an offer.                                      to represent them as well as third party
                                                                                           professionals to meet other requirements       “It was tough but now we are sitting back
                                           “Whilst tempting to accept, RDK ensured         that avoided delays and potential risks to a    and deciding what to do next, wondering
                                            that we followed the process and waited        successful completion.                          what our next project will be!”
                                            until the second round of bidding had
                                            finished.                                      Lisa added: “The level of support and
                                                                                           assistance we received from RDK was
                                           “Once the process was complete RDK had          invaluable. They helped us navigate
                                            negotiated an exclusive deal which was         the process from offer accepted until
                                            significantly higher than the asking price -   completion.”
                                            we were dumbfounded!”
                                                                                           “Without them we would have been lost
                                           Running the group while managing                 on many occasions, not knowing which
                                           the sale was not an easy balancing act,          direction to go in. They occupied the
                                           especially given its size and multiple           middle ground to smooth things over and
                                           locations.                                       we could rely on them to sort issues out.

                                           Lisa explained: “RDK advised us that            “RDK was a vital cog that kept everything
                                           getting the sale to completion was a             moving.”
                                           challenging experience, but we knew that
                                           with their support we could make it work.
                                                                                                                                                                         CONTINUED...

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GLOBAL CHILDCARE PROPERTY REPORT UK EDITION 2019 - THE COMPLETE CHILDCARE BROKER
CASE STUDY: REDWOODS DOWLING KERR - 2019

                                                                                                                                         SALE PROFILE

PROJECT PORTUGAL LITTLE ACORNS & 100 ACRE                                                                                                Little Acorns Ltd
WOOD EIGHT NURSERY SETTINGS                                                                                                              100 Acre Wood Ltd
                                                                                                                                         South West

WE ARE HERE TO HELP                                 GETTING THE SALE OVER THE LINE                                                       Timescales
MAXIMISE OUR CLIENT’S                                                                                                                    Sale opportunity launched:
                                           Jenna Caldwell, Director of Childcare &        Jenna added: “During the transaction
SALE PRICE WHILST                          Education for Redwoods Dowling Kerr,           process there can be lots of demands on
                                                                                                                                         June 2018
ALSO ENSURING WE                           supported the owners every step of             the vendor and we act on their behalf to       Heads of Terms signed:
                                                                                                                                         July 2018
DELIVER THE PERFECT                        the way.                                       find reasonable and innovative solutions to
                                                                                          ensure the deal completes.                     Completion:
BUYER AND THE RIGHT                        “We understand that when people sell a                                                        December 2018
DEAL.                                       childcare business that it’s an emotional     “From helping the vendor appoint a lawyer
                                            time. They have invested huge amounts of       with expert knowledge to helping oversee
                                                                                                                                         Buyer
                                            time, effort and money, and the business is    a raft of due diligence requirements
                                            very personal to them.                         around issues such as leases, insurance       Nursery Group, Just Childcare
                                                                                           and planning, we literally live and breathe
                                           “We also understand that they have to run       our clients’ experiences.
                                            the business throughout the sale process,
                                            so they can’t take their eye off the ball.    “It was a complex transaction with multiple
                                                                                           locations but we were all delighted with
                                           “We are here to help maximise our client’s      the outcome.
                                            sale price whilst also ensuring we deliver
                                            the perfect buyer and the right deal. At      “It demonstrates the true value of RDK - we
                                            RDK we work with our clients at every          do far more than advertise a business for
                                            phase of the transaction to assist them        sale, we make it happen and accelerate
                                            with the swiftest possible completion.”        wealth creation for our clients.”

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SOLD                                                SOLD                                                   SOLD                                                    SOLD

 Riverside Rascals                                   Roundabout Day Nursery                                Beach House Day Nursery                                  Cheverell Old School
                                                                                                                                                                    Nursery
 Argyll And Bute                                     Stoke on Trent                                        North Wales                                              Wiltshire

                                                                                                                                      Greater Manchester
A first-time buyer is enjoying his latest            Redwoods Dowling Kerr are delighted to                Redwoods Dowling Kerr are delighted to                   Kids Planet Day Nurseries acquire 25th nursery
business venture after acquiring Riverside           announce the sale of Roundabout Day Nursery           announce the sale of Beach House Day Nursery             via Redwoods Dowling Kerr.
Rascals in Lochgilphead, Argyll And Bute.            in Bucknall, Stoke on Trent.                          in Rhyl, North Wales.

The setting was acquired by Graham Ramsay,          The nursery was acquired by experienced                 Beach House Day Nursery is a family-run                    Redwoods Dowling Kerr is delighted to
who is looking to build on the success of the       operator Mrs Lesley Wagg, who is now looking            children’s day nursery andParkseparate
                                                                                                                                             Avenue out-of-
                                                                                                                                                       Day Nursery inannounce
                                                                                                                                                                        Sale, Greaterthe sale of Childsplay of Liverpool
business by renovating it and introducing a fresh   to build on the success of the business by              school club that has operated     under Mrs
                                                                                                                                      Manchester      wasHelen         Limited in
                                                                                                                                                           sold to Ms Hignett     whoWavertree,
                                                                                                                                                                                        had       Merseyside. The nursery
ethos. His knowledge of the childcare sector        introducing a fresh ethos.                              Thomas for over 10 years.previously purchased a childcare  was sold    to the highly regarded Kids Planet Day
                                                                                                                                                                              business
stems from his wife and daughter, who are both                                                                                        from Redwoods Dowling Kerr.      Nurseries; a family-owned group of 24 nurseries
registered nursery managers.                         Citing the location of the setting as one of the       Beach House Day Nursery has earned a                       in the North West of England. This sale marked a
                                                     factors that persuaded her to purchase, Mrs            truly enviable reputationRedwoods
                                                                                                                                       for the quality   of Kerr contacted
                                                                                                                                                    Dowling            celebratedthe 25th
                                                                                                                                                                                      owner addition to the group.
Citing the location as one of the factors that       Lesley Wagg said:                                      childcare provided, enjoying    historically
                                                                                                                                      of Park  Avenue highDay Nursery, Mrs Mcdowell, who
persuaded him to purchase, Mr Graham                                                                        levels of occupancy and wished
                                                                                                                                      regular toreferrals
                                                                                                                                                   discussand
                                                                                                                                                            the sale ofThe
                                                                                                                                                                        her sellers,
                                                                                                                                                                            nursery Mr so and Mrs Edwards commented
Ramsay commented:                                   “I would definitely recommend Redwoods                  recommendations.          she could pursue opportunities       outside
                                                                                                                                                                       on their       of the
                                                                                                                                                                                  experience     saying that:
                                                      Dowling Kerr, their service has been professional,                              childcare sector.
“Thank you to Natasha Satterthwaite at               prompt and friendly.                                   Commenting on the corporate sales process,                “We have recently completed the sale of our
 Redwoods Dowling Kerr for all her help through                                                             Mrs Helen Thomas said:Experienced buyer, Ms Hignett,       dayhad
                                                                                                                                                                            nursery    with Redwoods Dowling Kerr, who
                                                                                                                                                                                  previously
 the process of purchasing Riverside Rascals. She   “Natasha Satterthwaite has been amazing. She                                      purchased a childcare business   found   us several potential buyers that they knew
                                                                                                                                                                           through
 always responded very quickly to any questions      has been extremely helpful during an extremely        “The service provided by Sarah    EllisonDowling
                                                                                                                                      Redwoods        at      Kerr 2015would
                                                                                                                                                                         and hasbe quality
                                                                                                                                                                                     an      buyers.
 I had and helped with the process of dealing        complex purchase and she has remained                  Redwoods Dowling Kerrestablished
                                                                                                                                       was excellent.    She wasin the childcare sector
                                                                                                                                                     reputation
 with a complex sale. Thank you for all the help     upbeat and has always followed up any of my            professional, helpful andwith
                                                                                                                                       friendly  throughout
                                                                                                                                            numerous      yearsthe     Although
                                                                                                                                                                of experience       there were some unforeseen hiccups
                                                                                                                                                                                 of managing
 Natasha, it’s much appreciated!”                    concerns in an efficient manner. I will miss           sale. Thank you for all your help.”
                                                                                                                                      nurseries.                       along the way, they always had our best interest
                                                     hearing her cheerful voice every week.”                                                                           at heart and fought hard for us to achieve the
                                                                                                                                      Park Avenue Day Nursery offers   salethe
                                                                                                                                                                            wehighest
                                                                                                                                                                                  wanted. We are happy to have passed
                                                                                                                                                                       our reigns
                                                                                                                                      quality of childcare and is situated     in a on   to such a likeminded, quality
                                                                                                                                                                                     densely
                                                                                                                                      populated area with easy access  childcare
                                                                                                                                                                            to and  group
                                                                                                                                                                                      fromKids Planet and we would
                                                                                                                                      main roads and public transport  highly   recommend
                                                                                                                                                                            links.  As a result,Redwoods Dowling Kerr to
                                                                                                                                      the nursery has had long-standingothers.”success,
                                                                                                                                      which looks set to continue.

                                                                                                                                                                                                                       11
GLOBAL CHILDCARE PROPERTY REPORT UK EDITION - 2019

SELECTION OF SOLD CORPORATE SALES

                                     Stoke Bishop Montessori School                                                                           Busy Bees acquires kidsUniverse in
                                     Bristol via RDK                                                                                          London via RDK
                PROJECT                                                                                      Project Sphere
                JOSHUA

Project Joshua - Bishop Montessori School                                                                 Project Sphere - kidsUniverse
South West England                                                                                        London

A first-time buyer is enjoying her new business venture following the sale of Stoke Bishop                Redwoods Dowling Kerr are delighted to announce the sale of kidsUniverse; a chain comprising
Montessori School, via Redwoods Dowling Kerr.                                                             of two Montessori day nurseries in the London Borough of Harrow.

Pegah Esmaili acquired Stoke Bishop Montessori School in Bristol after falling in love with the           kidsUniverse was established by Mr & Mrs Shah in 2010. The business opened its first setting in
business and its location.                                                                                Kenton in 2013 which was then followed by the Harrow setting in 2016.
Situated in leafy Stoke Bishop, the setting is renowned in the locality for the quality of childcare      The nursery settings provide a welcoming home-from-home environment with a light and airy
provided. In 2015 the setting achieved an overall ‘Outstanding’ rating from Ofsted.                       feel throughout. Both properties benefit from good sized classrooms which create a pleasant
                                                                                                          environment to learn and play for all ages.
Stoke Bishop Montessori School is registered for 50+ children aged 2 to 5-years-old and enjoys
historically high levels of occupancy.                                                                    The previous owners spent a great deal on keeping the settings presented in excellent condition
                                                                                                          by way of a constant refurbishment program both inside and out along with fixtures, fittings and
Following the sale, the vendor Sandra Pidgeon, is now looking forward to retirement.                      learning equipment. Both the settings at Marlborough Hill and Preston Hill were converted to
The buyer Pegah Esmaili said:                                                                             nurseries from domestic dwellings but provide a purpose-built feel once inside.

“Thank you so much. I appreciate your patience and everything you did to ensure we got to                  The group has the capacity to provide childcare for 152 children and both settings have been rated as
 completion.”                                                                                             “Good” by Ofsted.

Senior sales negotiator Karrina Lee said:                                                                 The successful bidders were Busy Bees Nurseries Limited, who saw the group as the perfect
                                                                                                          acquisition to add to their ever-expanding group portfolio.
“I’d like to wish Pegah Esmaili every success in her future endeavours. I’m sure she will enjoy running
 the nursery and maintaining its excellent reputation.                                                    Marg Randles, Chief Academic Officer and co-founder of Busy Bees said:

“I’d also like to wish Sandra Pidgeon a happy and peaceful retirement.”                                   “It’s fantastic to be able to welcome kidsUniverse to our growing portfolio. We want to provide the best
                                                                                                           possible outcomes to children in our care and I look forward to working with their talented and like-
                                                                                                           minded teams to continue giving the children the best start in life.”

12
SELECTION OF SOLD CORPORATE SALES

                                     Storal Learning acquire Manchester                                                                           All About Children acquire latest
                                     nursery via RDK                                                                                              setting via RDK

Old Crofts Bank Day Nursery                                                                                Gingerbread House Day Nursery
North West                                                                                                 London

Redwoods Dowling Kerr are delighted to announce the sale of Old Crofts Bank Day Nursery in                 Redwoods Dowling Kerr are delighted to announce the sale of Gingerbread House Day Nursery in
Urmston, Manchester, to corporate buyers Storal Learning.                                                  Croydon to corporate buyers, All About Children.

Storal Learning own and operate several nurseries across England and their acquisition of Old              All About Children are the 12th largest nursery group in the UK, according to Nursery World, and
Crofts Bank Day Nursery is their most recent to be brokered by leading childcare broker, Redwoods          the sale of Gingerbread House Day Nursery marks their latest acquisition through leading childcare
Dowling Kerr.                                                                                              broker Redwoods Dowling Kerr.
Having successfully operated in the Trafford town of Urmston since 1997, the nursery has earned            Commenting on the transaction, the vendor Mr Shandakumar Arjuna said:
a truly enviable reputation for the quality of childcare provided. As a result, Old Crofts Day Nursery
enjoys historically high levels of occupancy and regular recommendations and referrals.                    “I would like to thank Karrina Lee who dealt with the sale of my nursery, the service she provided was
                                                                                                            excellent from start to finish.
A spokesperson from Storal Learning said:
                                                                                                           “We achieved 5 offers, 3 of which were above asking price. Once we had accepted the offer, Karrina
“We are thrilled to now be a part of Old Crofts Bank Nursery and very much look forward to working          Lee was on hand to deal with all aspects of the sale.
 with the nursery’s fantastic team to continue building on its long-standing reputation for high quality
 childcare.”                                                                                               Russell Ford of All About Children commented:

Senior Sales negotiator Sarah Ellison said:                                                                “2018 has been a huge year of progress for All About Children, a year in which we have transformed
                                                                                                            our business. Although we have perhaps ‘flown under the radar’, in the 16 months between August
“It was a massive decision for the sellers to come to market as they have run Old Crofts Bank Day           2017 and November 2018, we have acquired 13 new nurseries – taking our Group from 17 to 30
 Nursery for over 20 years.                                                                                 settings.
“After meeting with Storal Learning, they felt they were the right group to build on the success of the    “The most challenging part of that has been to find flagship nurseries operating in the premium
 business and ensure its excellent reputation prevails.                                                     sector, or nurseries with the potential to be, and we couldn’t have done that without the support of
                                                                                                            brokers such as Redwoods Dowling Kerr.
“I wish Linda Conway and Janet Hazzlewood all the best. It has been a pleasure assisting them with
 their sale, especially knowing how special the nursery, parents and staff are to them.                    “I’m very grateful for Jenna Caldwell and her team, who’ve done a fantastic job for us (and for sellers)
                                                                                                            and who’ve already found additional outstanding nurseries for us to acquire in early 2019.”
“We have worked with Storal Learning on other acquisitions and once again it was great to help them
 purchase another nursery. We wish them all the luck in the future.”

                                                                                                                                                                                                                      13
GLOBAL CHILDCARE PROPERTY REPORT UK EDITION - 2019

SELECTION OF PROJECTS FOR SALE

                                                                                                                                      Project Twilight
      Project Chase                           Project Jacob             Project Anna                     PR OJEC T ALV O N                                                   PROJECT ELIJAH

Project Chase                     Project Jacob                  Project Anna                      Project Alvon                    Project Twilight                Project Elijah
Scotland                          North West England             East of England                   North West England               South West England              South West England

Offers invited in the region of   Offers Invited for the Group   Offers invited in the region of   Offers Invited                   Bids invited                    Offers invited for the Group
£1.2m                             Freehold & Leasehold           £1.2m                             Freehold                         Freehold                        Leasehold
Freehold                          Ref: 46563                     Freehold                          Ref: 46748                       Ref: 46579                      Ref: 46513
Ref: 46539                                                       Ref: 46740
                                                                                                                                                                    Combined income of £1.3m
Turnover of £559k for the         Combined income of £1.3m       Income of £184k for the year      Income of £1.5m for the year     Combined income of £55k         for the year end March 2018
year end May 2018 with an         for the year end March 2018    end November 2017 with an         end June 2018 with an            with an adjusted EBITDA of      with an adjusted EBITDA of
adjusted EBITDA of £188k.         with and adjusted EBITDA       adjusted EBITDA of £53k.          adjusted EBITDA of £260k.        £159k.                          £236k.
                                  of £139k.                      Private term time only            A well-established children’s   Two oustanding children’s
Well-maintained children’s                                                                                                                                          The opportunity to acquire
                                  A group of 3 unique           nursery with a valuable           day nursery, with a separate     day nurseries with a stunning
day nursery with a capacity                                                                                                                                         an award-winning group of
                                  children’s day nurseries       four-bedroom detached             4-bedroom family home. This      4 bedroom cottage included
in excess of 75 children.                                                                                                                                           two children’s nurseries.
                                  with a combined capacity       family home set within 1/3        impressive nursery is set        in the sale.
Robust organisational                                                                                                                                               Combined capacity of 130
                                  for 200 children.              acre of land.                     within 1.5 acres of grounds.     Combined capacity for 95
structure in place with 15                                                                                                                                          children.
                                  2 modern purpose-built                                           Capacity for 134 children.       children.
dedicated staff.                                                 Current capacity for 44
                                                                                                                                                                    Team of highly-qualified
                                  settings and 1 historic        children.                         Rated ‘Good’ by Ofsted           Rated ‘Outstanding’
Rated ‘Very Good’ by Care                                                                                                                                           and long-standing staff.
                                  converted property.                                                                               by Ofsted
Inspectorate                                                     Significant potential to                                                                           Millie’s Mark accredited
                                  Robust organisation            increase capacity, income                                                                          2016/17 at both settings.
                                  structure in place with a      and profitability.
                                                                                                                                                                    Rated ‘Good’ by Ofsted
                                  team of 70+ staff.
                                                                 Rated ‘Good’ by Ofsted
                                  Rated ‘Outstanding’ & ‘Good’
                                  by Ofsted

14
EXIT PLANNING

If you want to discuss your exit
requirements then we would be
delighted to visit you in confidence to
discuss the options available.

Contact Robert Yates on 0844 7011 819
email Robert.Yates@redwoodsdk.com

WE ARE THE
ONLY BROKER TO
OFFER A “WHOLE
OF MARKET
APPROACH” FOR
THE CHILDCARE
SECTOR.

                                          15
Contact us to find out more about our complete        REDWOODS DOWLING KERR
                                                      Redwoods Dowling Kerr are the
Childcare business brokering service.                 complete childcare business broker.

                                                      From large groups to single settings,
To buy: Call Jenna Caldwell, Sarah Ellison,           we sell more childcare businesses
                                                      than any other broker.
Karrina Lee, Natasha Satterthwaite & Sophie Jakeman
or any of the childcare team on 0844 7011 812
or email Childcare@redwoodsdk.com

To sell: Call Robert Yates on 0844 7011 819
or email Robert.Yates@redwoodsdk.com

Or visit the UK’s fastest growing business broker
website www.redwoodsdk.com/childcare

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