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Regeneration Company Not Going Anywhere.

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REGENERATION firm St Modwen Properties yesterday posted half-year losses of £20m as it said the industry faced its toughest period since 1990.

The group, which holds a portfolio of around 5,000 developable acres and 18 town centre schemes, said current conditions meant it would not to attempt to sell any of its residential land until the market stabilised.

Among its major projects are three regeneration schemes in Wales. including the 1,000-acre former BP oil refinery at Llandarcy, of which 320 acres is developable.

The site is due to be transformed into the Coed Darcy urban village with 4,000 homes to be built over the anticipated 20-year development period.

It is also behind a scheme at Connah’s Quay in Flintshire where planning consent has been obtained for the redevelopment of the Deeside district centre, including a 52,000 sq ft foodstore, which has been pre-let to Morrisons and 20,000 sq ft of further retail space.

St Modwen is also behind the £1bn transformation of 600 acres of disused land at Llanwern, which was last year given the go ahead by Newport Council..

More than 6,000 jobs will be created in the scheme, which will see housing, offices and public open spaces created on an area which was once part of the vast Llanwern steelworks.

However, the recent downturn in the construction sector has seen St Modwen write off £37.7m from the book value of its residential sites, alongside £16.9m from its commercial portfolio.

This resulted in pre-tax losses of £20m in the six months to May 31, compared with profits of £65.1m a year earlier.

The company said: “We are reporting on what has been the most difficult period for the property industry since 1990.”

It admitted the “pace and severity” of the decline in the residential market had taken the company and the market as a whole by surprise.

St Modwen added: “This means that, for residential land, there is currently no genuine market, as the major housebuilders are unwilling to invest in land until they can see the way ahead more clearly.”

The company has 1,365 acres for residential development, but of these some 946 acres are carried on its books before the benefit of planning permission.

In Sunderland it has acquired the 9.3 acre former ARC International glassworks, while the 4.5 acre former RWE power station at Letchworth should lead to an 80,000 sq ft jobs scheme.

Meanwhile, four separate planning applications – representing £750m of mixed-use development – have been submitted to Birmingham City Council and Bromsgrove District Council for the regeneration of the 468-acre former MG Rover Works at Longbridge. The proposals include 1.8 million sq ft of employment space, as well as 1,980 new homes.


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  • 399 Brexit, House prices and Summer 2020

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      • down 5% +
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