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Inland Homes PLC on Wednesday said it sold its ‘non-core’ greenfield land portfolio, alongside providing a trading update, in which it said outlook for the UK housebuilding industry is worsening.
The Buckinghamshire, England-based brownfield site developer, housebuilder and regeneration specialist said the sale of its non-core greenfield land portfolio was for £9.5 million, resulting in a profit of £3.5 million.
There was no portfolio-associated debt, and so Inland Homes’ cash balances has improved by £9.5 million, it said.
Inland Homes said it decided to dispose of the greenfield ‘strategic land’ option portfolio - consisting of 2,822 potential plots with 81% located in the green belt - in light of recent UK government announcements strengthening green belt restrictions, alongside the backdrop of an ‘already challenging’ planning system.
As part of the sale, Inland Homes has agreed to assist the purchaser with certain planning and management services in consideration for further management fees to be received in due course.
The sale will allow Inland Homes to focus on enhancing its brownfield land value through the planning process, it said.
Inland Homes also provided a trading update for the financial year that ended September 30 last year, in which it said the outlook for the UK housebuilding sector has deteriorated since its last update on September 6, in which it forecast a pretax loss of £37.1 million.
The company now has revised this figure to a £91.0 million loss, as financial 2022 planning consent numbers fell to 1,029 plots from 1,831 a year earlier, alongside plot sales dropping to 237 from 356.
Inland Homes also completed fewer private homes, falling to 180 versus 216 in 2021, although the average selling price grew to £304,000 from £262,000.
Inland Homes said it will release its financial 2022 results at the end of February.
‘With rising interest rates, high inflation rates and the cost of living crisis, which has adversely impacted the ability of first time buyers to buy new homes, the future prospects for the industry have taken a turn for the worse,’ Inland Homes said in a statement on Wednesday.
Sentiment has been hurt in terms of market confidence and property valuations, the company said, but it noted demand for its land assets remains strong ‘in a market where consented land in the south and south east is in extremely limited supply’.
‘The group has experienced an extremely disappointing year,’ said Chair Simon Bennett.
‘However, we continue to see good interest for our new homes and valuable consented land in the south and south east of the UK.’
Inland Homes said the strategic review being led by Lazard & Co Ltd continues, with an announcement expected by the end of March.
Shares in Inland Homes were down 33% to 11.75 pence each in London on Wednesday afternoon.
By Greg Rosenvinge, Alliance News reporter
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