Places for People, one of the UK’s biggest housing associations, has agreed to buy 750 factory-built homes in a £100m deal.
The investment is the largest made by a housing association in the UK in the modular homes sector, which is growing fast as the government seeks alternative avenues to stimulate homebuilding.
David Cowans, chief executive of Places for People, said the deal would accelerate delivery of homes and cut costs. “This is just the start for off-site manufacturing and as placemakers we are going to invest even more in modular,” he added.
The group is set to deliver a further 25,000 homes over the next few years, and has been supported with grant funding by Homes England, a government body responsible for increasing housing delivery.
“It’s no secret that the housing industry has been facing significant productivity and skills challenges in recent years,” said Edward Lister, chair of Homes England, which is “committed to championing modern methods of construction — such as modular homes — to increase the pace of delivery across the country”.
The investment represents a “huge vote of confidence in modular housing”, said Dave Sheridan, executive chairman at ilke Homes.
Modular units are built in factories, rather than on site. Interest in the sector has grown in recent years, as skills shortages and rising materials costs — both exacerbated by Brexit — have hampered traditional housebuilding in the UK.
The government is chasing a target of 300,000 new homes a year by the mid-2020s, against current delivery of roughly 200,000. Homes England plans to invest £27bn to accelerate building in the next few years.
This month, the government body partnered with Japanese developer Sekisui Homes on a £90m scheme to deliver “thousands of new homes”.
Encouraged by clear government support for disrupting traditional housebuilding, major players are seeing modular housing as an “opportunity”, said Mark Farmer, who has advised the government on the future of the construction industry.
The vast majority of housebuilders and developers anticipate that modular construction methods will have a considerable impact on the sector in the next five years, according to a Knight Frank survey of 100 housebuilders and developers, published last year.
Modular has not traditionally been a huge part of the market, in large part because of consumer scepticism around quality and the cost of construction, said Aynsley Lammin, an analyst at Canaccord Genuity. With advances in technology, a reduction in costs and a shortage of labour, the sector was looking more appealing, he added.
Article & image source: Financial Times
Commentaires