Keepmoat will move into offsite construction this year as it continues to strengthen the house building arm of its business.
The contractor has partnered with an as yet unnamed manufacturer and will provide land for the development of at least 500 offsite homes per year.
It comes as Keepmoat’s financial statements for 2015/16 show it has boosted its revenue from its new-build homes business 28.3% to £336.6m, with 2,416 completions in the year.
Meanwhile, its revenue from its regeneration business – which includes repairs – has fallen 3.6% to £802.7m due in part to the impact of the social rent cut.
Dave Sheridan, chief executive of Keepmoat, told Inside Housing: “We are seeing the spend profile [of clients] at the moment very much in new build.
“We are certainly looking at an offsite solution. We have partnered with a manufacturer and we are developing a product together. It’s very early stages but we are certainly looking for a minimum of 500 homes per year.”
Offsite construction has long been a goal for the UK housing sector and is set to be expanded with huge pension fund L&G investing in a modular homes factory in Leeds.
As it expands its new build business, Keepmoat also launched a private rented sector partnership with investor Sigma earlier in the year.
Its financial statements, seen exclusively by Inside Housing, show profit for the year up to £62.2m, up from £44.1m last financial year despite the difficulties in its regeneration business.
Overall revenue grew 3.5% to £1.1bn, with the new build growth offsetting the regeneration fall.
Mr Sheridan added: “I think what happened is councils and housing associations took stock and sat on their hands over a few schemes. So felt an impact in the short term where some schemes were cancelled or postponed but we managed our way through that.”
However, he said the situation had now stabilised, despite a continuing “air of uncertainty” around the government’s priorities.
Its statements said the fall in revenue was due to “a combination of project cancellations and deferrals, following the implementation of the rent cap on housing associations and terminating a small number of loss making contracts through the year.”
The financial statements showed a regeneration pipeline of £1.054bn, down from £1.142bn the year before.
Original link - Inside Housing
