Good Progress in 2015

2015 started with a period of pre-election uncertainty but, once concluded, our house builder customers once again made land purchases. As the year progressed, we found house builders becoming more selective as they replenished their land banks towards the required level. However, high quality consented sites in good locations continue to be highly sought after and to command good price levels.
During the year we sold sites at Cranbrook (Exeter), Nuneaton, Chellaston (Derby), Haddington, Biddenham (Bedford), Frome, Repton, Pontefract and Edinburgh. In total, our interests in 1,763 plots were sold, a 59% increase on 2014’s 1,107 plots.

The new Government confirmed its commitment to housebuilding, most notably by enforcing National Planning Policy Framework guidance on a five year land supply. We won a number of appeals during the year, including one at Warton, Fylde, where we secured permission for 360 dwellings in advance of an emerging Neighbourhood Plan. During the course of the year we achieved planning consent (or consent subject to a Section106 legal agreement) on our sites in Aldingbourne, Aslockton, Chesterfield, Coxhoe, Haddington, Langho, Launceston, Lutterworth, Market Harborough, Marston Moretaine, Prestonpans, Woodville, Selby and Handcross. At the end of 2015 we had increased our total land interests to over 11,000 acres, 1,982 acres of which has planning consent for over 12,000 plots, and 1,160 acres is allocated in a plan for residential development.

We see the current balanced marketplace continuing through 2016. We will continue to invest in our land portfolio, having careful regard to ensuring our investments are focussed where house builders wish to build, whilst carefully managing our overall investment in the sector. Selectively, the business will seek to secure agreements which benefit our commercial development activity companies, in particular, Stonebridge Projects and Henry Boot Developments.

Cranbrook, the new 3,500 unit community at Exeter; Kingsdown, our urban extension at Bridgwater, and New Lubbesthorpe, a 4,500 unit urban extension west of Leicester, all had a very good year. Cranbrook saw residential occupancies exceed 1,150 (in the two and a half years since residential sales commenced), the opening of a railway station (on the London Waterloo line) and both a secondary school and a second primary school were completed and opened. Development at Kingsdown, Bridgwater, continued with further residential sales anticipated in 2016. Henry Boot Developments are also close to securing a commercial development on the main A38 road frontage. New Lubbesthorpe, a scheme of 4,500 dwellings (where we have an interest in 1,593) commenced development and our investment in this major urban extension will create returns over the longer term.

We successfully sold part of our long-term investment at Biddenham, Bedford, during the year and we forecast further parts will also be sold in 2016 and 2017.

Significant new investments were made during the year at Grazeley, south of the M4 at Reading, and Coventry. Other key strategic sites within our portfolio progressed well during the year; Market Harborough (450 plots) secured a minded to grant planning consent; the first phase of Kettering East (438 plots) was conditionally exchanged to a national house builder; and Phase 2 of Marston Moretaine (365 plots) was granted planning consent in December 2015, the first phase having been sold successfully in 2013 to Bovis Homes, and we expect to market part of this scheme in 2016.

Outlook for 2016 and beyond.

2016 has started well with two site sales already concluded and a number of others progressing well for completion later in the year; 180 plots were sold in Alton, Hampshire, and seven acres of employment land were unconditionally exchanged in Lutterworth.

We expect the house builders to remain selective when purchasing land in 2016 but we have a strong land portfolio with a supportive planning regime, a substantial number of sites available to the market and, at this stage, we anticipate that 2016 will be yet another year of good progress.