Recovering UK Economy sees London Developer Telford Homes Double Profits
The boom in the London housing market and the city’s expanding population has seen property developer Telford Homes more than double its profits in the last financial year.
The demand for homes in the capital boosted Telford’s pre-tax profits for the year to end of March to £19.2m compared to a figure of £9m last year.
The company also expects to double its profits again by 2018. Cumulative pre-tax profits for the next four years are set to exceed £120m.
Domestic buyers were the largest group of purchasers in the year to end of March, accounting for more than a third of Telford’s 515 home sales
Telford will start work in September on a block of flats in Stratford Central after securing forward sales worth £70m, pre-selling 148 of the 157 homes in just four weeks following a UK-exclusive sales launch of the project.
The project, also known as ‘Angel Lane’, is expected to be completed in the year to 31 March 2018, and marks the first time Telford has completed forward sales four financial years in advance.
Telford Homes is focuses on the development of up-and-coming locations in the inner-city, outside of the ever-more expensive market in London’s centre.
As well as the acquisition of two large sites in Stratford, which will see more than 500 homes developed in total, Telford now has sites in Hackney, Tower Hamlets, Camden, Islington, Lambeth, Southwark and Barnet.
Telford is known to sell about a third of its homes to international investors, but said fears of a housing bubble in London were overblown, and that the imbalance between supply and demand inevitably led to increasing.
The share of purchases from foreign investors actually fell from 39 percent to 32 percent year-on-year.
It also make clear that while mortgage finance was more readily available in a recovering economic climate, lenders had learnt from the financial crisis and not returned to the days of handing out high interest mortgages, saying applications are “still carefully policed” and not comparable to 2007.
Jon Di-Stefano, Chief Executive of Telford Homes, said: “I am delighted to be reporting another excellent year for Telford Homes resulting in an enhanced forward sold position, substantially improved margins and pre-tax profits more than doubling. Our development pipeline has increased to £875 million of future revenue, which is more than six times the revenue reported in the year to 31 March 2014”.
The construction industry: Facing a mental health crisis
Data collected by the Office for National Statistics has shown that more than 2,000 construction workers took their own lives in 2017. Other findings from a study conducted by the Glasgow Caledonian University show that the problem is getting worse. From 2017 to 2019, the number of suicides per 100,000 rose from 26 to 29, with people in the construction industry three times more likely to take their own lives in 2019 compared to other industries.
Why is the construction industry experiencing a rise in mental health conditions?
Bill Hill, Chief Executive of the mental health charity Lighthouse Club, says that one reason for the rise in mental health conditions is due to financial pressure. He said that it is a “huge factor” in construction, “causing stress, depression, and anxiety”. He added that several self-employed workers are “brilliant tradespeople but don’t have the education”, which may be helpful in running their business.
“They win a project, someone pays them a big invoice but they don’t put money aside for VAT [and then] the taxman asks for payment so they get finance. It tumbles from there. Sole trader-style business management should be taught at apprenticeship level”, Hill said.
According to Lighthouse Club, the industry is “hugely fragmented” and “difficult to reach over half of the 2.8mn self-employed construction workers. “Some larger companies have done a fantastic job on mental health”, Hill says. “But only apply their programmes and workshops to their own staff. Until you get to the huge mass of very capable tradespeople who are getting no input, one of the biggest problems is awareness”.
How can awareness of mental health be improved in the construction industry?
Chief Executive of the Construction Industry Council, Graham Watts, says that the industry has made positive steps forward on mental wellbeing but that “it is still not doing nearly enough” to support staff in this area.
Looking at how awareness of mental health can be improved in the industry today, Watts said: “Today, I would hope it is easier to be more open about mental health. I’m impressed by the leadership that is being shown by some companies – for example, Tideway, where Chief Executive Andy Mitchell has ‘mental health first aider’ immediately after his email sign-off – but it is still only being exhibited by the best of the best”.
Lighthouse club has also launched a campaign for construction workers to raise more awareness of mental health in the industry. Named “Help Inside the Hard Hat”, the campaign makes all workers aware of the services that Lighthouse Club offers, “regardless of employment status”, the charity says. Lighthouse Club is taking particular care to encourage contractors to put up posters on sites and ensure that they reach all workers, including the self-employed.
The charity also has a free app that allows workers to access mental health information and resources. Lighthouse Club is also improving the availability of information by working with partners such as the Safer Highways charity and Glasgow Caledonian University. But the charity is working on improving the understanding and destigmatisation of mental health in the industry one step at a time. Hill said: “The first thing is suicides,” says Hill. “That is the number one benchmark of all the work we are doing – are we reducing suicides in the industry?”.
If you are a construction worker - or someone you know is and you need support, you can call the Lighthouse Club helpline on 0345 605 1956.