Crest Nicholson expects 10% of its output next year to use an element of offsite manufacturing.
The forecast came as the housebuilder unveiled a 2% fall in pre-tax profit for the half year to 30 April 2018, as compared to the same period a year before. Revenue rose 13% to £473.8m.
In its half-year update, the company said it had started to introduce elements of offsite manufacturing into its house building operations as part of its new core housing range.
The company hopes to offset rising labour costs by manufacturing light gauge steel walls offsite rather than using traditional breeze blocks, with 10% of its homes containing an element of offsite manufacture by next year, according to chief executive Patrick Bergin, quoted in the Daily Telegraph.
Bergin said the company's flat pricing against a back-drop of continuing build cost inflation had had an "adverse impact" on margins, which had led it to take action to offset build cost pressures.
Crest Nicholson built 1,251 houses during the half year, up 18% on the year before.
In May, it closed its central London office and reopened a South East division, based in Kent.
It has four regional businesses around London that will serve the outer London market and will serve the London market where opportunities arise.
It said the move would "provide flexibility to reduce reliance on London volumes where conditions or returns are not attractive".
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