The Treatment Centre Company is an enterprise investment scheme (EIS) that aims to buy and operate treatment centres and temporary accommodation for people with drug and alcohol problems.
The board of directors plan to raise up to £5m to buy the centres and a cluster of surrounding residential properties. Each residential property is expected to house up to six people and the EIS's board of directors will be looking for properties in the North and the Midlands, where prices are more affordable than in the South.
The board of directors point out that the Government is keen to tackle drug and alcohol dependency and has increased its spending in this area over the past few years.
The directors say the existing 130 treatment centres in England and Wales can cope with just 8,700 people, which is inadequate for dealing with the full scale of the problem. This EIS provides a way for investors to make a profit while helping the community.
High-net-worth clients who are looking for the tax breaks that come with EIS investing, but who also want to help people overcome addictions may find this appealing. However, IFA Best Invest says this is a high-risk investment because the entire concept and the projections made in the prospectus depend upon finding suitable and affordable premises, plus the surrounding properties to house people who are receiving treatment.
The EIS might also encounter problems with local authority funding of places at the treatment centres and there is no guarantee that the number of places at the centres will be filled at all times.