Sunday 18 November 2018

Collen boss Drumm warns land price hitting housing

Housing projects are unviable due to soaring land prices with signs of a new bubble, Collen Construction boss Tommy Drumm has warned. Stock Image: Bloomberg
Housing projects are unviable due to soaring land prices with signs of a new bubble, Collen Construction boss Tommy Drumm has warned. Stock Image: Bloomberg

Fearghal O'Connor

Housing projects are unviable due to soaring land prices with signs of a new bubble, Collen Construction boss Tommy Drumm has warned. The former All-Ireland winning Dublin captain declared that Government efforts to increase housing supply may not succeed.

"Some of the things you saw pre-recession are returning," he said, adding that under current circumstances the building sector will struggle to build enough houses to solve the crisis.

"We are watching the residential sector carefully. It is going to need companies like us getting involved to help turn around the supply."

Drumm was head of housebuilding for PLC McInerney pre-recession and was responsible for delivering 2,200 homes a year.

"It's very difficult to get up to those sort of numbers now. I don't see any one entity being able to deliver anything over maybe 500 units but huge increases are needed," he said.

Collen's turnover will hit €200m this year thanks to major data centre, retail, commercial and industrial contracts. It is bidding for housing jobs with major property firms and can deliver 250 houses.

Companies like Kennedy Wilson and Hines that bought land at distressed prices "now have ability to deliver product to the market that works", said Drumm.

For those who have had to buy land since then, it's proving a challenge, he added.

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