These are some of the issues covered in NurseryWorld’s analysis of the market ‘Nursery Chains 2022: Overview – Gaining Ground’ published in March 2022, for which Cairneagle partner Arun Kanwar shared his insights:
Occupancy recovery differs amongst operators
“Group operators are on average doing better than single sites, partly because they’ve focused strategically on catchments where there are dual-income working professionals who’ve weathered the economic challenges of Covid better, and partly because they have invested in recovering their enrolment through CRM and inquiry conversion and can invest in mitigating staff recruitment and retention issues.”
Regional variations in occupancy recovery
“Regional differences are also apparent and we’re seeing more challenges in places like Yorkshire and the Humber and parts of the South West in terms of enrolment.”
Unprecedented deal activity over 2021 …
“The market is more active than we’ve ever seen it. The overall M&A [mergers and acquisitions] market – not just childcare – is incredibly busy, mainly because so much capital has been raised that needs to be deployed, and debt is still cheap. Within the overall market, education and nurseries are proving especially desirable.”
… leading to the growth of multiples
“What’s happened with nursery valuations over the past 15 months or so has confounded our expectations of two years ago.”
Regional hotspots for M&A
“Operators are starting to look outside London and the Home Counties more as prices have heated up there so much. Central London has been slightly less desirable for some investors post-Covid because of changing work patterns and because people have moved to other areas of the UK.”
Continued thesis for buy and build
“There is still a lot of growth left in the marketplace and there are substantial opportunities for consolidation.”
Read the full article on the 
website here.
