Fortune favours the brave, so it is said. This is certainly the experience of the Holywood-based Aspen property group. While much of Northern Ireland’s construction sector has been destroyed by the recession, Aspen has thrived – by taking the courageous route.
“We did very well during the recession,” says managing director Gilbert Yates, son of the founder, also called Gilbert. “We took a chance in the downturn and it worked very well for us.”
Until the recession, the main business line for the 36 year old Aspen group was in handling building repairs for insurance companies. But insurers responded to the financial crisis by cutting costs and meeting claims with cash payments, rather than commissioning repair work.
Recognising that the traditional business model was under threat, Gilbert Junior changed direction. “My business would have just failed overnight,” he explains. “So in 2008 I investigated the nursing homes market.”
Land had become cheap, while there was an undersupply of nursing home provision in the private sector – in part because the property boom had made land acquisition for care homes unaffordable. Yates took advantage of the crash to buy land suitable for development.
Initially Aspen undertook design, build and finance contracts for established nursing home providers based in Great Britain that were moving into the Northern Ireland market. It has now completed the construction of its sixth care home.
But the time is right, believes Yates, to go beyond the development and construction of care homes into their management. Accordingly a new group company has been established, Healthcare Ireland. “Rather than build for people we now have our own operating business,” says Gilbert.
The first of these managed homes will be on Belfast’s Crumlin Road, with construction due to begin in the next few weeks. It will have 82 beds and a new management team has been recruited to run the home. Yates praises Ulster Bank for backing the new business, saying it has been “very supportive”.
While this is a change of direction, Yates explains that it has been conducted after careful and detailed consideration. Healthcare Ireland worked closely with a British partner to develop a due diligence package, exclusive to them, that assesses the viability of potential care homes. “This has been a unique element to sourcing the locations and sites,” he explains.
For Aspen and Healthcare Ireland, this is not just an exciting time, but it is already proving a successful new phase. “We are probably the leading nursing home developer in Ireland,” says Yates. The company now intends to move forward by also becoming the leading provider of nursing homes under their own management.
“We are securing land now for future developments. We know exactly where we want to be in the next four years. Healthcare is a growing sector – people are living longer,” explains Yates.
The healthcare business is not the only thriving part of the Aspen group, which has more than a hundred employees, but it is clearly a key part of its growth plan. Aspen has also taken advantage of the difficulties encountered by other parts of the construction sector and has just taken over the site of a medical centre to complete a large building project.
Gilbert is content that he has handled the recession in the right way and changed business focus at the right time. “The main lesson for me,” he says, “has been to have an exit strategy.” Once the signs of decline were clear in the business for insurers, it was important to take decisive, but informed, steps forward he says. “We did due diligence very thoroughly. People who had been buying land [during the bubble] weren’t doing research – it was like Monopoly.”