While Storm Eunice may have blown itself out the sector is continuing to experience a high-speed wind of change. Nursery sales and acquisitions have reached a peak of activity in the last year, with transactions hitting a record breaking £500m-plus, according to property company Redwoods Dowling Kerr.
Meanwhile Christie & Co predicts a two tier market emerging in 2022 – which suggests that high value sales will be sustained for quality businesses in the right areas while the predicted growth in ‘distressed’ sales will compound local disparities in provision. Those who are struggling due to a reliance on (under) funded places or a recent downgrade by Ofsted will face an uncertain future.
This picture is supported by research from Leeds University which sampled more than 2000 settings (see analysis on p8). It reports that in 2020, 16 per cent took on debt and 14 per cent permanently cut staff – and a third did nothing. But doing nothing is unlikely to remain an option for much longer.
To gain a sharper focus on the shape of the market and the prospects for its recovery, look no further than our annual Nursery Chains supplement, enclosed with this issue. It pulls together a wealth of information and includes two key tables – a Top 25 of groups by size and by Ofsted rankings. We know that what plays out among the groups ultimately affects everyone in the sector.
Market change has its human dimension as well. We’ve just seen David and Anna Wright, long-standing owners of the award-winning Paint Pots nursery group in Southampton, selling up to a local social enterprise. It’s good to know that they will continue to work as ambassadors to the sector as David explains in his letter on page 50. I suspect we could be saying goodbye to some more familiar faces in the coming months.
