The impact of the downturn on privately owned housebuilders has become clear as the end of year results for three of the UK’s largest show revenue falling by up to three-quarters
The Crosby Group is a developer specialising in apartments that was bought by Lend Lease from the Berkeley Group in 2005. Its revenue fell 77% to £29.4m. Its losses for the year to June 2009 grew 60% to £54.6m; this included a £34m land writedown. It has reduced the value of its land holdings by £79m since the start of the recession.
Crosby was hit by a glut of apartment developments in its core cities of Birmingham, Manchester and Leeds. The firm sold just 227 homes in the year, compared with 793 in 2008.
However Richard Cable, head of development for Lend Lease, said in a statement that the corporation was still committed to the company. He said: “The residential platform and in-house expertise Crosby provides is crucial for Lend Lease’s UK pipeline.”
Revenues also dropped dramatically at Gladedale Homes. Its sales fell 49.4% to £316.1m, leading to a loss of £106m. This followed a land writedown of £27.4m.
The firm was effectively taken over by Lloyds bank in September after it breached covenants with lenders. The deal provided the company with £517m of working capital through a loan from the Bank of Scotland.
Bloor Homes posted year end results showing revenue from its housebuilding operation fell by 7% to £310.5m. It made a loss of £1.5m, a significant improvement on the figures for 2008, when it was £35.1m in the red.
Kevin Cammack, a housing analyst at Cenkos, said that despite two tough years for the housebuilding industry, he was still surprised by the extent of Crosby and Gladedale’s fall in turnover. He said: “Unquoted smaller builders are probably more vulnerable to the downturn because they are reliant on specific markets.”
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