Profits soar at Berkeley despite housing market uncertainty

Grant Prior 5 years ago
Share

Berkeley now holds enough land to build more than 46,000 homes as profits continue to soar at the company.

Chairman Tony Pidgley said the housing market is facing a number of headwinds
Chairman Tony Pidgley said the housing market is facing a number of headwinds

But uncertainty over the London housing market could delay delivery of much needed new homes.

Latest results for the year to April 30 2017 show pre-tax profits up to £812.4m from £530.9m last time on turnover up to £2,723m from £2,047m.

Berkeley accounts for 10% of homes under construction in London and has built 19,000 new homes in the last five years.

Chairman Tony Pidgley sounded a warning about current market conditions in the capital as reservations dipped 25% last year.

He said: “The housing market has stabilised in London and the South East but, while Berkeley is in excellent shape with further additions to our unrivalled land bank in the period, it is an inescapable fact that we are facing a number of headwinds and a period of prolonged uncertainty.

For Berkeley, this leads to greater uncertainty around the timing of delivery of homes from our land bank but will not change our absolute focus on the quality of the homes and places we create.

“Notwithstanding the uncertainty, Berkeley’s strong forward sales position and land bank provide sufficient visibility to reiterate its previous guidance of delivering at least £3.0 billion of pre-tax profit in the five years beginning 1 May 2016, assuming prevailing market conditions persist.”

Berkeley reported that build cost inflation remained stable at around 6%.

It said: “There is a recognised skills gap in the UK construction workforce and it is hard to predict how build costs will be affected by Brexit as approximately half of London’s site labour comes from the EU.

“This needs to be addressed by a combination of continued access to EU labour, skills training and innovation in construction if the industry is to achieve its medium term production aspirations.”

The firm currently has 13,000 people working on 58 live sites across London and the South East.

Latest news

Balfour Beatty UK construction MD to step down

Tom Edgcumbe to depart after just over a year as MD construction services in England and Wales
3 hours ago

Crest Nicholson trebles cladding retrofit provisions to £43m

House builder revises building safety retrofit costs in face of new Government guidance
2 hours ago

BAM bags £110m refurb of iconic Covent Garden tower

Landmark Seifert-designed 15-storey Space House to get two extra floors
16 hours ago

Winvic to start UK’s largest speculative shed

Ellesmere Port warehouse understood to be worth around £80m
3 hours ago

Kier signs deal for £169m Luton hospital revamp

Main construction work to start this month and last until 2024
2 hours ago

Willmott Dixon nabs £30m Kirklees police HQ

Work to start within next few weeks on regional police HQ
10 hours ago

50 firms win £750m decarbonisation framework

Fusion21 framework to target 'whole building' works on homes and schools
3 hours ago

Kier reported to be in talks to buy Tilbury Douglas

Talks reported to be at an advanced stage between both boards
1 day ago

Finance sealed for next-generation London office job

Goldman Sachs takes stake in London Bridge office project
1 day ago

John F Hunt starts giant clean-up on £110m Walsall site

Land remediation work at contaminated site will take two years
1 day ago

Build to rent boom lifts Watkin Jones profit to £52m

Surging build to rent market lifts development pipeline to £1.8 billion
1 day ago

HS2 awards £310m station lifts and escalators deal

TK Elevator signs 160 lifts and 130 escalators deal for four stations
2 days ago

Robot cutter set to revolutionise paving jobs for Eurovia

Automated system will spell end for noisy slab cutting on busy sites
2 days ago

First mass built carbon negative homes get underway

St Modwen first volume developer to build affordable carbon-negative homes
2 days ago

GMI Construction names new CEO

Lee Powell takes helm as CEO at GMI Construction in growth push
2 days ago

514-home London scheme clears final hurdle

Inland Homes declares victory after three-year planning battle over Hillingdon Master Brewer site
2 days ago

Henry Construction wins £30m Clarion housing scheme

Ravensbury estate regeneration in Mitcham is Henry's first project for Clarion
2 days ago

Lovell lands £700m homes deal with Suffolk council

Development joint venture will see at least 2,800 homes built across the county
2 days ago

Ballymore pulls 51-storey tower plan amid fire safety concern

London Fire Brigade raises concern about single staircase and fire strategy
5 days ago

New work surges as materials shortages ease

Mild weather and easing of supply chain bottlenecks lifts new work 5.7%
5 days ago

PDR Construction goes into administration

All staff made redundant as suppliers owed millions
6 days ago

Brick-laying robot gets approval from NHBC

Robot can now be used in construction of new homes covered by NHBC warranty
5 days ago

Temporary visa scheme needed for London sites

Mayor of London demands action over site skills shortages
6 days ago

Construction worker dies after fall from mobile tower

Court hears how tower wasn't configured correctly
6 days ago

Glencar wins £50m Peterborough logistics hub

Works start on trio of sheds at Kingston Park
6 days ago

Green light for £330m Woking high-rise cluster

Work to start on five blocks towards the end of 2022.
6 days ago

Countryside chief executive makes sudden exit

Major shareholder takes seat on board as first quarter trading falls below board expectations
6 days ago

Big names line-up for £2.7bn Birmingham roads deal

Arup, Arcadis, Balfour Beatty, Carnell, Colas, Kier and Tarmac among firms eyeing contract
6 days ago

Galliford Try scoops £56m Milton Keynes PRS job

Building arm will deliver 329 rental flats across four buildings rising up to 11 storeys
7 days ago

Designers shortlisted for £1bn Oxford Innovation district

Oxford Uni and L&G advance £1bn Begbroke science district plan
7 days ago

Contractor services