Multiple practice ownership grows by 50% in the last four years
The number of multiple practice owners in dentistry has grown by 50% since 2015, according to Christie & Co.
In its review of 2019 so far, the specialist business property adviser estimates around 400 practice owners with two+ sites.
The report claims continued market consolidation is creating a ‘mid-market’ as companies reach the 50-site mark.
‘With an unabated appetite from all lending institutions, the dental market remains buoyant,’ Chris Vowles, head of valuation services – medical at Christie & Co, comments.
‘This is helping drive the continued demand from potential operators from both an acquisition and refinance prospective.
‘With the continued emergence of private equity platforms and demand, prices achieved will continue to grow.’
Shift towards private
Christie & Co is also reporting a shift towards the private sector, to counterbalance risks currently associated with the NHS.
However, NHS dentistry is still considered highly attractive for many entering the sector.
Many of these are independent buyers who are less sensitive to current recruitment challenges, as they will be an owner-principal and directly involved in the performance of the NHS contract.
‘Despite the ongoing challenges of associate recruitment, particularly in the NHS sector, and an uncertain political climate,’ Simon Hughes, managing director – medical at Christie & Co, comments.
‘The dental sector continues to perform very well with significant transactional activity across all price ranges.’
Recruitment and retention of associates is directly impacting the performance of NHS contracts, its review says.
Christie & Co reports a two-tier market emerging in the NHS sector.
Well located and/or run practices demonstrating consistent UDA performances are selling for a significant premium.
‘The crisis in NHS dentistry is now hitting communities from Cornwall to Cumbria,’ the BDA says about the recruitment crisis.
‘Underfunding and a failed contract have left dental practices without dentists, and our patients are seeing the result.
‘The official line is recruitment problems are just anecdotal.
‘Even though the government’s own surveys show over a million new patients tried and failed to access care last year.
‘Aren’t a million anecdotes enough to make ministers wake up to this problem?’