Innovating key worker accommodation is not just a moral imperative – it’s a strategic one

5th December 2023

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Innovating key worker accommodation is not just a moral imperative – it’s a strategic one
  • The recruitment and retention of vital health and care staff is strained by a severe lack of key worker housing amid a cost-of-living crisis.
  • Reducing commute times and living costs helps to enhance job satisfaction, strengthen retention rates and attract a more diverse workforce.
  • Prime’s innovative key worker accommodation solution is unlocking the recruitment and retention challenge for NHS trusts at pace.

In today’s economic climate, finding affordable, quality housing close to work is becoming an acute challenge for key workers – one that is stifling the recruitment and retention strategies of the NHS. The solution to building a sustainable pipeline of critical talent? The delivery and certainty of new key worker accommodation.

The backbone of any robust healthcare system is its workforce. However, sustaining a health and care workforce is becoming an increasing challenge, complicated partly by a severe lack of affordable, quality housing near key workers’ places of work. A survey at one trust found that 68 per cent of staff said a lack of affordable housing would be a key driver in deciding to leave their current employment within the next two years.[1]

In a post-pandemic world, the stress on healthcare systems has never been more apparent, bringing the value of key workers into sharper focus. Health and care workforces have been under immense strain, and ensuring they have a safe, comfortable and convenient place to live can significantly impact their wellbeing and, by extension, the quality of patient care. Investment in key worker accommodation is not just a moral imperative; it’s a strategic one.

Reducing commute times and living costs can enhance job satisfaction, strengthen retention rates and attract a more diverse workforce. With NHS trusts reporting a staff shortfall of 150,000 set to rise to 360,000 by 2036 without significant action,[2] the urgency of this challenge becomes evident.

However, a lack of investment in key worker accommodation over previous decades alludes to the complexity of solving this challenge. Changes to NHS accounting rules have further complicated the issue and proved prohibitive to progress on this issue.

The NHS has long been impacted by a lack of capital investment, as evidenced by an increasing backlog maintenance requirement. It is understandable that constrained capital is focused on improvements to clinical spaces to support direct patient care, however, NHS staff also deserve quality accommodation. The offer from Prime can benefit both NHS staff and NHS trusts, supporting staff wellbeing, recruitment and retention.

Michelle Robinson, Associate Director, Prime plc

Innovating for today’s needs and tomorrow’s demands

Unlocking the key worker accommodation challenge and, in turn, supporting the NHS recruitment and retention challenge hinges on an innovative approach to a complex problem. Innovation to not only the design of high-quality, flexible spaces but innovation and commitment that bring projects to fruition.

Prime’s experience in helping NHS trusts unlock complex estate challenges has given us first-hand knowledge of the significant financing and human capital hurdles leaders must overcome. It’s what has motivated us to devise unique design and funding solutions that make the development of key worker accommodation a reality within the reach of embattled NHS and health and care organisations.

Prime has spent the last few years leveraging our expertise to develop, test and action a proprietary key worker accommodation model that addresses this increasing urgency. We have an innovative and transformative solution that develops, funds and builds high-quality, affordable and furnished key worker accommodation at pace.

Our management company Hyve by Prime operates as a not-for-profit business, addressing the high demand for desirable, affordable and bespoke key worker accommodation close to hospital sites. Benefitting from flexible tenancy lengths that meet the changing lives of residents, Hyve developments are all built with sustainable, energy-efficient and functional building designs to create comfortable and safe spaces for health and care professionals to call home.

Commercial innovation

Prime’s proprietary model is a viable solution that can deliver affordable key worker accommodation at pace, meeting the needs of NHS trusts, ICBs and local authorities while also adhering to the changing regulatory landscape.

Hyve by Prime works by redeveloping existing NHS buildings or land or acquiring a suitable plot or building close to a hospital site to create new accommodation developments. By partnering with an institutional investor, Prime secures the capital for the project, and because Hyve by Prime directly manages rental agreements and residents, it removes all the demand risk for NHS trusts, offering an off-balance sheet solution.

Commercial factors of Prime’s key worker accommodation model – Hyve by Prime:

  • NHS trusts are not procuring any works or services under Prime’s model, negating the need for a formal public procurement process.
  • There is no requirement for NHSE approval because the trust is not seeking any capital or committing CDEL.
  • The Prime contract structure is not a service concession, so it does not need DHSC approval.
  • Investor market testing assures that any long-lease granted of NHS land has been market-tested.
  • NHS trusts provide facilities management (FM) services at a fixed price (subject to annual indexation) to support the operator in keeping staff lettings affordable.

Design innovation

The way people live and work is continually evolving, as are the needs of NHS trusts. To provide accommodation solutions that work for today, but can also adapt to tomorrow’s challenges, Prime embeds flexibility and sustainability into every Hyve by Prime development.

With flexible designs and structures, Prime’s model allows providers to adapt to the changing needs of residents while meeting their long-term strategic ambitions. For example, today’s medical students may expand their own families in the future and require accommodation that meets their changing dynamics. Likewise, trust priorities also evolve, so the ability to flex accommodation, such as four two-bed units into eight-bed accommodation, gives hospitals the agility they need to meet future demands, for example, when staff numbers fluctuate.

From a sustainability perspective, tearing down existing buildings and starting from scratch is incredibly costly and could also conflict with the NHS’s sustainability ambitions.[3] As a B Corp, Prime understands these challenges, so, where possible, we are devising innovative solutions that can convert existing buildings into flexible new units.

Design features of Prime’s key worker accommodation model – Hyve by Prime:

  • Purpose-built, furnished apartments close to places of work to reduce commuting time.
  • Flexible tenancy lengths designed to meet the changing lives of residents.
  • Functional design that considers how residents live and what will enhance their home environment.
  • Sustainable, flexible construction that enables buildings to be adapted to meet changing needs.

“Alexandra House in Dorchester is a great example of Hyve by Prime and its impact. Our tenants have personally told me they feel an increased sense of security living there. It has significantly improved their mental health and wellbeing. They’re also feeling happier in their job as being part of a community made up of their colleagues has really improved their home life. It’s a delight knowing that Alexandra House has provided them with so much comfort and, essentially, improved their way of life.”

Sara Leonard, Hyve House Manager, Prime plc

Process innovation

In response to the whitepaper A People-Driven Approach: Delivering NHS Homes, the government has talked about a cross-departmental NHS and private sector taskforce led by Lord Markham to explore avenues towards developing affordable key worker housing. While this is an essential step towards tackling the issues, the timescales will be too long for some NHS trusts.

The benefit of Prime’s solution is that it can deliver at pace. Within a few weeks of establishing a trust’s recruitment and retention priorities, Prime can produce a key worker accommodation viability model, proposing early site options, initial diligence assessment, feasibility designs and typical rental levels for staff.

Process features of Prime’s key worker accommodation model – Hyve by Prime:

  • Prime puts in place a legal planning agreement to guarantee the key worker accommodation delivers rent at or below market value, ensuring the best outcomes for residents and the trust’s long-term recruitment and retention strategies.
  • The availability of land, planning constraints and outcome of a demand and supply study will determine the number and typology of accommodation.
  • An embedded cascade system can be periodically reviewed, meaning the type of tenant can change.

Fortified futures

The healthcare sector stands at a crossroads, with the opportunity to redefine what it means to support its key workers. By investing in high-quality, flexible accommodation, the lives of these vital community members will be enriched and the foundations of our healthcare systems fortified.

Prime has worked solely in health and care for close to thirty years, meaning we are committed to delivering meaningful change on this issue and helping NHS trusts proactively address the recruitment and retention challenges straining services. That’s why we’ve chosen to operate Hyve by Prime as a not-for-profit business.

Success hinges on NHS trusts working with organisations like Prime who adopt a genuine partnership approach to challenges such as key worker accommodation. Only by working in tandem with the public sector to utilise innovative creative and capital solutions will quality and affordable accommodation be delivered while also safeguarding capital budgets. By convening around these issues and forging a path forward together, we can deliver a future where our healthcare services thrive because the people working within them feel supported, secure and hopeful.

[1] Government forms taskforce to push NHS housebuilding

[2] NHS Long Term Workforce Plan

[3] Greener NHS

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