Britain's largest residential home is planning to expand its specialist services to north London in a merger with another leading care home.

The union means that Hammerson House, based in Hampstead Garden Suburb, north-west London, and in part funded by the Hammerson family, will undergo a major refurbishment to bring it in line with Nightingale's expert nursing and dementia services.

Nightingale, based in Clapham, south London, and home to 200 residents, will open its state-of-the-art £6.5 million dementia unit next month.

Leon Smith, chief executive of Nightingale, said: "We came to the realisation that there was significant synergy between the two organisations.

"Nightingale is in a different position to Hammerson because our client group has been getting much older and we do masses of nursing and dementia care. Hammerson are a bit behind us on that pathway. Only now are they being faced with similar problems.

"They will benefit from our expertise and experience in relation to nursing and dementia because that is the future of residential care."

Mr Smith said the two homes would remain on their own sites and Hammerson would maintain its name.

"We have been perceived as being a south London organisation so this may change that perception," he added.

"People in north London will be able to benefit from the Nightingale brand.There are difficult times ahead for voluntary sector homes because of the pressure on local authority funding and in the private sector too. I feel that together we will become a stronger organisation and be equipped to weather that storm."

Tony Michaels, co-chairman of Hammerson House, which has 96 residents, said: "The board of Hammerson are delighted at the possibility of the merger of Hammerson and Nightingale. Both of us have a shared vision of providing residents with the highest standards of care.

"A merger will not only mean that both Hammerson and Nightingale are stronger but older Jewish people throughout our community will also be better served."