Friday 18 October 2019

'We may be living in an era where housing will never outstrip demand' - Glenveagh COO warns as company reports loss of €3.5m

Glenveagh Properties chief executive Justin Bickle
Glenveagh Properties chief executive Justin Bickle

Gavin McLoughlin Ellie Donnelly

Ireland's housebuilders may never reach the 35,000 unit a year mark that analysts believe is necessary, according to Glenveagh Properties chief operating officer Stephen Garvey.

Mr Garvey told reporters that we "may be living in an era where housing will never outstrip demand".

"You'd question whether the market will ever get there. Maybe the market only gets to 26,000 or 27,000. If you look at the UK, they always said they needed 300,000 but the market never could produce it."

He said he it would be "a push" for the industry to build 20,000 units this year.

Mr Garvey was speaking as Glenveagh published results, reporting a loss of €3.5m for 2018.

During the period the group generated revenues of €84m including the sale of 275 units totalling €79m, and land sales of €5m.

However, administrative expenses at the company topped €17m, according to annual results from the group.

Meanwhile costs of sales were €69m.

Since the group’s IPO in 2017 it has invested €615m on the acquisition of development sites. This includes a €50m investment in two sites in Leixlip and Newbridge Co. Kildare announced today.

The sites currently have full planning permission for 793 units.

Glenveagh said it was actively constructing on 14 sites during 2018, with over 1,100 units under construction during the period.

The group is currently selling from eleven sites, with 451 units sold, signed or reserved (excluding Herbert Hill, Dundrum) at 5 March 2019.

Glenveagh added that “significant progress” had been made towards obtaining planning and de-risking the group’s large scale 1,850+ unit private rental sector portfolio, in addition to developing its long term mixed-tenure capabilities.

Glenveagh’s co-founder and CEO Justin Bickle commented: “2018 was a very strong execution year at Glenveagh.

We were delighted to exceed our key targets, selling 275 homes in our first full year’s trading, against our 250 goal, and continued to add new sites to our attractive and flexible land portfolio.”

Looking forward Mr Bickle said he remained “confident” about the residential market backdrop in Ireland.

“We remain on track to deploy the remaining €90m share placing proceeds,” he added.

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