St. Modwen, the Solihull-based developer said it intends to focus on housebuilding and logistics after reporting a loss for 2020 of £120.8 million, following its profit of £49.5 million in 2019.
The company will pull away from strategic land and regeneration, which now represents less than a quarter of its total portfolio, down from 35 per cent in 2019. The company sold £125 million of non-core assets and surplus land during 2020 and a further £7 million since November. It intends to sell around £180-200 million of assets by 2023, reducing its strategic land and regeneration to less than 10 per cent of overall portfolio, and focus land capability solely on sourcing land for logistics and residential development.
Sarwjit Sambhi, who took over as Chief Executive Officer of St. Modwen last September, said: “Our strategy is focused on two sectors, logistics and housebuilding, where structural demand is growing, acknowledging that the economic outlook is uncertain. These sectors make up 78 per cent of our portfolio today and will represent over 90 per cent within three years. In both, momentum is strong, and we have an attractive pipeline to accelerate growth.
St. Modwen Logistics’ represents 49 per cent of the company’s total portfolio, up from 39 per cent in 2019. Earlier this month the company appointed property industry veteran Polly Troughton as Managing Director of St. Modwen Logistics business. With one of the UK’s largest logistics development pipelines at at around 19 million sq ft, the appointment comes as St. Modwen Logistics plans to deliver a further 1.5 million sq ft of new urban and big box logistics units in 2021, 25 per cent more space than 2020, with 27 per cent of committed pipeline pre-let or under offer
It sees a significant upside in 19 million sq ft long-term pipeline, focused on key logistics corridors and conurbations to grow its portfolio to more than £1 billionn by 2023 through development.
There are plans too, to grow St. Modwen Homes, which current represents 27 per cent of its total portfolio, up slightly from 2019. The company said it has a 5,900-plot pipeline and aims to grow volumes to around 1,500 units by 2023.