M&G Real Estate partners with Durkan to provide 206 new homes for rent in East London
Durkan has released a strong set of results for the financial year to 30 November 2016, thanks to a strong performance in its core markets, delivering new homes across London and the Home Counties.
The results reflect more steady progress made by the company’s contracting and development divisions during 2016. This can be attributed to a significant contribution from its private development pipeline and the conclusion of legacy projects from its construction division. This has allowed Durkan to focus on larger projects with improved margins and on growing its presence in the Build to Rent / Private Rented Sector (PRS).
During the financial year, Durkan completed its first partnership transaction with the London Borough of Wandsworth in Putney (pictured) and started a development of residential units, restaurants and a new public square with Aylesbury Vale District Council.
In March 2017, Durkan signed a £77m deal with M&G Real Estate, one of the UK’s largest property investors to finance and build 206 new private rental houses on the Britannia Music Site, Ilford. Given the Group’s strength in land acquisition, development and construction, they will seek to undertake more partnership deals in the PRS sector in the coming year.
Consolidated turnover of the Group for the period was reported at £141m with profit after tax of £7.4m.
Net worth increased by 16% to £52m while the business held a healthy cash balance of £13m at that date.
The construction division ended the period with a strong order book of £350m and appointments to selected frameworks for potential work opportunities, with a combined value of £4bn.
The Group’s private development pipeline value is in excess of £300m with projects across London and the Home Counties.
In response to the financial results Executive Chairman, Danny Durkan, said:
“I am pleased to report a strong financial position for the Group. Our previous set of results were exceptional due to us completing an unusual number of high value contracts in the period, so the fact we’ve followed this with another strong year is extremely encouraging.
Our future strategy is to continue working with local authorities and housing associations through equity partnerships and joint ventures. We will look to deliver more partnerships in the PRS sector in the coming year and progress the transactions we’ve already agreed. Our forecast for the next five years indicates a steady increase in turnover, with a greater emphasis on land acquisition, joint ventures and partnerships. This will see our development division representing more than half of our overall turnover by 2022. In the short term, we have a good balance sheet, strong cash reserves, a healthy order book and a significant development pipeline. We are therefore confident in our ability to continue growing the business.”
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