St Modwen reviews work pipeline as profit falls

St Modwen new chief executive Mark Allan has opened a review of the firm’s development pipeline after reporting a fall in trading profits for the year.

He said the past twelve months have been unsettled, and said the outlook for both 2017 and 2018 looked similarly uncertain.

The firm said it planned to expand the housing business and press ahead with several industrial schemes while the business review was underway.

St Modwen said PRS projects would offer potential to accelerate residential development and gain exposure to a market with good structural growth prospects looking ahead.

“We see some potential to develop assets for the emerging private rented sector and we will assess the scale of this opportunity during 2017,” said Allan

He said the firm’s medium term commercial pipeline offered good value creation opportunities and bringing several schemes forward would be a focus this year.

This includes schemes at Chippenham Gateway (over 900,000 sq ft of potential industrial/ logistics space) and Stanton Cross (1.5m sq ft of industrial accommodation), as well as town centre regeneration projects at Kirkby and Great Homer Street, Liverpool.

On the commercial side, St Modwen plans to start construction at several speculative warehouse schemes in 2017 amid continuing demand.

Commercial starts 2017

·     Tamworth East, Tamworth, Staffordshire – Planning consent secured for 700,000 sq ft of industrial and logistics space. 

·     Burton Gateway, Burton-upon-Trent – Planning approval granted for two industrial and logistics units totalling 328,000 sq ft in the next phase of this 64 acre business park which has outline consent for up to 1m sq ft of industrial space. 

·     Thurleigh Airfield Business Park – Planning consent secured for the development of a new 40,000 sq ft workshop and office facility for SMH Fleet Solutions, an existing tenant at the business park. Works started last month and will complete later in the year.

On the growing residential side, St Modwen said that subject to planning, eight new sites will commence works this year. 

Residential start 2017

·     Littlecombe, Dursley, Gloucestershire – The third phase of 200 homes at this long-term regeneration project which is the site of the former Lister Petter factory. When complete it will comprise 200,000 sq ft of commercial space and 600 homes.

·     Egstow Park, Derbyshire – The first phase of approximately 160 homes at this new community in Derbyshire which, when complete, will provide approximately 820 new homes and 80,000 sq ft of commercial space, with a local centre and public house.

·     Glan Llyn, Newport, South Wales – The fourth phase of approximately 160 homes at this major regeneration scheme in South Wales which is transforming the former Llanwern Steelworks site. When complete it will provide 4,000 homes, two primary schools, a retail centre and a 500,000 sq ft business park.

Pre-tax profit fell from £235m to £67m for the year to November, due largely to a combination of external market factors and significant valuation gains booked in 2015.

from Construction Enquirer http://www.constructionenquirer.com/2017/02/07/st-modwen-reviews-work-pipeline-as-profit-falls/

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