Smaller builders will be crucial to hitting the Government’s ambitious target of 300,000 new homes a year, claims the construction industry.
The comments follow Homes England’s announcement this week of a £150m joint venture with Barratt and Lloyds bank to develop large-scale brownfield sites and create ‘garden villages’.
The National Federation of Builders, NFB, said it understood that such partnerships were logical for accessing finance and large-scale residential schemes but sounded a note of caution.
NFB policy and market insight head Rico Wojtulewicz said: “We are particularly concerned that the government is wedded to the larger developers.
“It’s increasingly worrying that they only see them as the solution. You are going to have to have SMEs in part of the delivery of 1.5m new homes.”
He said smaller firms delivered training and retain staff, unlike large developers who typically employ people on a contract basis to do a particular job.
“SMEs will use a consistent supply chain in the local area and directly employ people.”
Mr Wojtulewicz said that according to government data we had as many carpentry and joiner students in the year 1987 to 1988 as we have construction apprentices today.
New partnership dedicated to creating attractive and sustainable homes
Barratt Developments, Homes England, and Lloyds launched Made Partnership this week to act as a master developer for residential-led schemes of between 1,000 to 10,000 homes.
Barratt said Made would oversee the installation of the primary and community infrastructure and would then sell serviced land to housebuilders.
Head of PR Derek Harris explained: “This will include all types of developers, from majors to SME homebuilders.
“This is one of the strengths of a master developer, in that it helps prepare land for builders that may not ordinarily look at such big sites – meaning SMEs can then get involved.
“It also de-risks development for them as they have access to de-risked land from a planning and infrastructure perspective.”
Barratt’s chief executive David Thomas said the company, whose pre-tax profits for the end of June 2024 nearly halved, was committed to delivering the homes the UK needs over the next ten to 20 years.
Housing and Planning Minister Matthew Pennycook said: “This landmark new partnership will support our commitment to ramp up housing supply and boost economic growth by developing more large-scale, attractive, and sustainable places across the country with the homes, jobs, and infrastructure that communities need to thrive.”
“Through the partnership, we are creating a master developer which can manage the infrastructure and placemaking that is needed to deliver at scale, whilst consistently achieving high quality and sustainability standards.”
Homes England chief executive Peter Denton said the partnership would have the expertise for a cohesive approach to develop brownfield sites, extend an existing town or create a new village.
Brokers Hank Zarihs Associates said development finance lenders were positive about a collaborative role in delivering large-scale housing projects.