THE MEDIESTATES MID-YEAR REVIEW
The year so far has shown plenty of positive trends in the dental market. Lorraine Hunt, Practice Transitions Supervisor, reveals why the future looks so promising for both buyers and sellers of dental practices.
The activity, we at Henry Schein MediEstates have seen on the dental market so far in 2021 demonstrates the sheer determination of our clients to return to normality. As an end to COVID restrictions gradually becomes a reality, this reaction looks set to continue. When we compare this year’s practice valuation and sales activity to those pre-COVID, there seems little doubt the pandemic has influenced dental practitioners across the UK into taking control of their careers. Whether venturing into practice ownership or deciding to exit the business, practitioners are intent on creating a positive future for themselves.
In excess of 30% more new buyer customers are registering with MediEstates every month compared to 2019. Our three buying tiers – Regular, Priority and Premier – have all gained members due to increasing confidence in the market as restrictions ease. Our buyer customers range from entrepreneurial individuals to well-established corporations, meaning sellers of independent practices up to the largest groups can benefit from the growing appeal of practice ownership.
Increasing confidence translates into positive action as viewings, offers and agreed sales have all risen. The number of viewings has increased by “double digits” compared to this time last year which might not be too surprising considering the situation in the first half of 2020. However, the increase has contributed to total offers for dental practices exceeding £200m so far in 2021. This value growth not only surpasses 2020 but also improves on 2019. Similarly, compared to the same period in 2019 and 2020, practice sales agreed subject to contract are over four times higher than last year’s figures and 30% higher than those in 2019, while completed sales have maintained absolute consistency throughout. The attraction of strong lending potential from keen investors in dental offices has significantly contributed to this increased activity.
If the expectation for the first half of 2021 was cautiousness, our figures conversely reveal an encouraging sense of optimism and determination from buyers ready to thrive post-lockdown.
Practice sellers are also acting now and taking important decisions they were contemplating throughout lockdown. The higher numbers of valuations we saw in 2019 and 2020 reflect a period of consideration. Since January 2021, sellers who have used this time for reflection, have proceeded to move away from practice ownership. For some, the pandemic has acted as a catalyst to focus more on dentistry or preferring to exit the industry entirely. On the other hand, the increase of new buyers registering with MediEstates signifies a great time for budding owners embarking on dental practice ownership journey and for current practice owners increasing their exit options.
Opportunities are not limited to certain areas within the UK or even to practice type. Offers received on practices cover 34 counties across the UK and the Republic of Ireland, and new clients registering with MediEstates span the same wide area. Our numbers also indicate an almost level balance between sales of leasehold and freehold practices, and between NHS, private and mixed practices. Sale prices ranging from £225,000 to £21.5m, with practice turnover ranging from £71,000 to £8m, give a good indication of the variety of dental businesses sold.
Market activity in the first half of 2021 has rebounded very well. Adapting to an uncertain future has left practitioners determined to regain control by creating opportunities for themselves. As restrictions ease and excellent lending potential continues, 2021 marks a year for positive action within the dental market.
For more information and to find out more about our buying tiers, please visit our website at www.mediestates.co.uk or call us on 01332 609318
Lorraine Hunt has more than 18 years’ experience within the Dental Sector. She joined MediEstates in 2003 and currently works as the company’s Practice Transitions Supervisor, working closely with the Internal Estates Transitions teams and the Practice Valuation Managers. Lorraine’s expertise ensures buyers and sellers are provided with the wraparound care they need throughout their journeys with MediEstates.