That’s the conclusion to be drawn from Berkeley Group’s latest interim statement this morning. For the four months to 28 February, the housing developer said that “excess capacity in the construction sector” was ample compensating for rising cost of fuel and commodities to keep build costs “benign”.
Berkeley added that overall sales reservations for the quarter were 25% up on the same period last year. Visitor numbers had not gone up, but the company had more active sites and cancellations were at an historically low level. Forward sales currently exceed £800m.
Over the quarter, Berkeley has acquired a further 1,000 plots across eight new sites bringing the total number of plots acquired in the year to 3,500 across 21 sites. These include: a site in the City with an existing planning consent for some 750 new homes, a 337-bed hotel, 601 student bedrooms and 100,000 sqft of commercial space; a site in Kensington acquired by St Edward (a joint venture with Prudential) near the existing 375 Kensington High Street development; and a number of sites in the Southern Home Counties and Oxfordshire for up to 20 homes each.
Berkeley has also obtained planning on two of its key London development. A planning consent for 752 homes and 140,000 sqft of recreational and commercial space which will include a hotel, gym, spa, bars and restaurants has been received at Tideway Wharf in the Nine Elms Regeneration Area between Vauxhall and Battersea. Planning consent has also been secured for One Tower Bridge, a site jointly owned with the London Borough of Southwark, where 400 homes will be built, along with 90,000 sqft of cultural and retail space.
Berkeley’s board expects to report earnings at the high end of its expectations for the year ended 30 April 2011 and further profit growth in 2011/12 is also currently expected.
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