Telford Homes plunges to £193m loss
1/11/23
London private rental flats developer Telford Homes booked a £193m loss for last year after taking stock of potential remedial building safety works.
The losses are a significant setback for global real estate investor CBRE, which bought the London housing developer/builder four years ago for £267m.
Before the take-over Telford Homes espoused the merits of its shift to a lower risk build to rent model, delivering projects for housing associations and specialist rental property investors to order.
Since being acquired by CBRE, Telford has only returned a pre-tax profit once in 2020 of just £1.7m.
In 2021, it tumbled £14m into the red, mainly down to delays and exceptional costs following a subcontractor failure on the refurbishment of architect Erno Goldfinger's listed 27-storey Balfron Tower in East London.
Refurbishment of Balfron Tower in East London proved a costly job
The latest hit in newly published accounts to December 2022 comes mainly from signing the Government's Building Safety Pledge in May 2022.
Telford now estimates it will need to spend £143m on building fire safety remedial works in coming years.
This big write-down was further compounded with losses from onerous build to rent contracts and further losses incurred on the Balfron Tower block job, which finally finished this summer.
Even before these exceptional losses, Telford Homes said it will still ran up a pre-tax loss of £18m from turnover up 5% to £296m.
CBRE, which is a leading build to rent developer in the USA, bought Telford with hopes of achieving similar success in the UK.
In recent years, Telford, which employs 280 staff has tried to expand its geography outside of London to commuter belt towns around the capital.
Source; Construction Enquirer