UK homebuilder Berkeley flags hit to London transaction levels

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imageStock Markets1 hour ago (Jun 23, 2021 11:16)

© Reuters.

By Aby Jose Koilparambil

(Reuters) -High-end British homebuilder Berkeley Group plans to incorporate more green spaces in its developments to cater to rising demand from buyers who prefer to work from home, its CEO said on Wednesday.

UK’s housing sector has outperformed the wider real estate segment, thanks to government incentives and rising interest in spacious properties suited to the remote working trend.

“We will make sure that we have enough community spaces so people can leave their flats and have enough open spaces like parks within the community so they can work from there if they like to do so,” chief Rob Perrins told Reuters on Wednesday.

Berkeley, one of the UK’s largest homebuilders by market value, flagged that transaction levels in London have been impacted by pandemic-related restrictions, although it reported a rise of about 3% in annual pre-tax profit at 503.7 million pounds ($703.67 million).

The FTSE 100 firm, which operates mainly in London, Birmingham and the south of England, said transaction levels in the capital city have been hit by the restrictions on travel and deferral of certain sales launches, among other things, and its shares fell 2.4% in morning trade.

However, it added that enquiry levels in London are now ahead of pre-pandemic levels, which signals the return of confidence to the housing market there.

Unlike its bigger rivals, Berkeley mainly focuses on regeneration of brownfield sites by redeveloping land that was previously used for industrial purposes.

The group said it was on track to deliver a 15% pre-tax return on equity, equating to annual pre-tax profits of roughly 500 million pounds till fiscal 2025 end.

UBS analysts said in a note that the rise in the London enquiry levels “could point towards more robust pricing… and better reservations”.

($1 = 0.7158 pounds)

Work from a park! UK homebuilder Berkeley laps up remote working trend

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