Building safety costs and problem contracts keep Telford Homes in red

Telford Homes has fallen to a £40m pre-tax loss after being hit by building safety costs and problems on its conversion of the Balfron Tower in east London.

Despite the heavy loss in the year ended 31 December 2023, the London-based build-to-rent builder’s performance was much stronger than the year prior, when it fell to a £194m pre-tax loss.

It put its 2023 loss down to “building safety provisions, onerous build to rent contracts and the refurbishment of a listed residential tower” – the same factors it had blamed the previous year.

The residential tower is understood to be the delayed refurbishment of the grade-II* listed Balfron Tower in east London. Telford is understood to have been hit by a subcontractor failure in its work on the Erno Goldfinger-designed, 1960s social housing block.

But Telford admitted that even without these exceptional losses, its pre-tax loss climbed to £24.6m compared with £18.4m.

The firm’s building safety related costs for the year stood at £3.3m, significantly down from the £143m recorded in 2022.

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The company added it had raised its remediation provision by £22m from £115m to £137m.

Revenue for the year, excluding the group’s share of joint ventures, was £165m, down from £296m.

Telford, which was established in 2000 and is owned by CBRE, employed 240 staff at the end of the financial year.

Its current business strategy involves building its reputation as a build-to-rent developer and broadening its geographic focus across London and surrounding commuter towns.