Gleeson gears-up for post pandemic work push

Grant Prior 2 months ago
Share

MJ Gleeson is planning to raise £16.4m from a share placing to allow the house builder to accelerate construction work after the Covid-19 crisis.

Gleeson suspended building work on all of its sites last month and furloughed three quarters of its workforce.

Gleeson is now preparing for the post-pandemic world and an acceleration in build rates.

Key to boosting work rates will be protecting the supply chain and Gleeson has set aside £4m of the new cash for its subcontractors.

The share placing will :

  • Ensure subcontractors and key trades are ready to re-commence building. The Company will work closely with its supply chain, mindful of their own financial positions, honouring commitments and bringing them back to site. This is expected to cost c.£4m
  • Secure materials including the supply of bricks, block timber, kitchens and other materials ensuring availability on resumption of building. This is expected to cost c.£2m
  • Purchase and open new sites under contract. This is expected to cost c.£10m

Gleeson currently has 1,046 plots built to slab level across its 67 active sites.

It anticipates that, in addition to the resumption of building on its current sites and completion of its current order book, there “will be a significant opportunity to convert the company’s current pipeline of new sites owned or under contract to help satisfy demand for the company’s homes.”

Gleeson has 22 new sites owned or in planning of which management had, prior to the current lock-down, planned to phase the openings of 17 sites during the remainder of the first half of 2020.

It is now “targeting a compression of these new site openings into a smaller window once COVID-19 restrictions are lifted.”

Gleeson said: “The company believes that once COVID-19 restrictions are lifted, low cost homes and those sold to first-time buyers will be the segment of the housing market that will recover the fastest.

“A precursor to home ownership is the saving of a deposit of as little as £5,000. A significant proportion of the company’s customers are the Key and Critical Workers who will be working overtime during the current health crisis and may emerge from this period having saved such amounts.

“To be able to meet the demand for its homes, building on current sites and opening of new sites will be concertinaed into a much shorter time scale, which will be more capital intensive than usual.

“The Company is therefore proposing to raise additional capital by way of the Placing to provide additional liquidity.”

Latest news

SIG management blunders rack-up £112.7m loss

New boss promises growth strategy after PwC called in to investigate divisional forecasts
6 hours ago

Union calls for construction workers to wear masks

Unite demands revisions to Construction Leadership Council guidelines
1 day ago

Robertson approved to start major Blackpool hotel

Site clearance to start next week on phase 2 of £100m Talbot Gateway regeneration
6 hours ago

Failed NHS Nightingale joinery firm sold in pre-pack deal

J&P Carpentry and Joinery went into administration after working on Birmingham NEC hospital
1 day ago

Steel erection starts on first HS2 bridges

Cleveland Bridge starts erecting 65m bridge to span M42
6 hours ago

Scotland’s builders begin return to work preparations

Firms hope to be cleared to return to work from mid-June
7 hours ago

£61m infra loan to pave way for 6,500-home scheme

Local contractors to sign first deals this summer to transform Cambridgeshire site
7 hours ago

Keep the industry updated by joining the Enquirer Directory

Membership lets construction know you are open for business now or in the future
2 years ago

Vistry asks subcontractors to cut rates

House builder warns trade packages could be retendered
1 day ago

TClarke rides out lockdown and eyes £2m half-year profit

M&E boss says swift cost savings helped firm breakeven in April and May
1 day ago

Kier confirmed for £97m Heartlands Hospital job

Work to start this summer on Ambulatory Care and Diagnostics Centre
1 day ago

Costain completes £100m fund raise

Dubai contractor takes 15% stake in Costain
1 day ago

Tycoon’s £1bn flats scheme consent quashed in Whitehall U-turn

Housing secretary accused of bias in backing Richard Desmond's 1,500-flat Isle of Dogs scheme
2 days ago

First pictures of giant HS2 tunnelling machines

TBMs being manufactured in Germany before launch on site later this year
1 day ago

M&E contractors hoping to ‘hold on’ through covid crisis

Engineering services leaders urge whole supply chain to work together to survive
1 day ago

Griffiths to start £25m historic Welsh viaduct upgrade

Restoration work to start next month on 150-year-old wooden viaduct
1 day ago

Barratt subcontractor rate cut letters “sent in error”

Specialists assured that 15% rate reductions are "not company policy"
2 days ago

NHS Nightingale joinery firm goes under

J & P Carpentry and Joinery collapses weeks after fast-track NEC conversion
2 days ago

EDF seeks consent for £18bn Sizewell C nuclear plant

Project will employ 25,000 construction workers, delivering a big post-covid 19 stimulus
2 days ago

Covid-19 compliance officers keep Ballymore sites safe

Contractors can draft in virus-protection help from new specialist supplier
2 days ago

ISG secures £17m Dudley leisure centre

Work to start on delayed Flood Street area leisure centre and swimming pool
2 days ago

Construction output to plunge 25% this year

Despite a strong rebound 2021 forecast to be down 6% from last year
3 days ago

£1bn building safety cladding fund open to applicants

Residential building owners can apply for funding for remedial work on non-ACM cladding systems
3 days ago

Roads contractors told to halve accident rates

Highways England aims to build on improved site safety performance seen during covid-19
3 days ago

Keepmoat to restart work on sites across England

House builder employs 1,150 staff and supports 10,000 supply chain jobs
3 days ago

A66 TransPennine £1bn upgrade route picked

Amey/Arup JV wins £45m design contract
6 days ago

Plan in for station on £40m revived Birmingham rail line

Plan lodged for new Moseley station on Camp Hill railway re-opening project
3 days ago

Highways firm trials social distancing tags on sites

Lightweight system can be clipped on belts, lanyards or hard hats
3 days ago

Ferrovial drops Agroman name

Ferrovial Construction become major project brand
3 days ago

Button pressed on race for £25m lift framework

Specialists wanted for four-year deal across north of England
3 days ago

Contractor services