Jump to content

Barratt Redrow

From Wikipedia, the free encyclopedia
(Redirected fromBarratt Homes)

Barratt Redrow plc
FormerlyBarratt Developments Limited (1958–1981)[1]
Company typePublic limited company
LSE:BTRW
FTSE 100 Component
IndustryHousebuilding
FoundedMay 14, 1958;66 years ago(1958-05-14)
HeadquartersCoalville,England, UK
Key people
RevenueDecrease£4,168.2 million (2024)[3]
Decrease£174.7 million (2024)[3]
Decrease£114.1 million (2024)[3]
Number of employees
6,451 (2024)[3]
Websitewww.barrattredrow.co.uk
1970s Barratt housing inWetherby,West Yorkshire.
A Barratt development nearReading
A David Wilson Homes branded house of Barratt Developments nearLongford, Gloucestershire

Barratt Redrow plcis one of the largestresidential property developmentcompanies in the United Kingdom operating across England, Wales and Scotland. It is a constituent of theFTSE 100 Index.It was originally based inNewcastle upon Tyne,England, but is presently located at David Wilson's former offices inCoalville,England.

Barratt was originally founded in 1958 by Lewis Greensitt andSir Lawrie BarrattasGreensitt Bros.to build houses. During 1968, the company, which had by then been renamedGreensitt & Barratt,wasfloatedon theLondon Stock Exchange.Following Lewis Greensitt's departure, the company was rebranded as Barratt Developments. It grew rapidly during the 1970s, largely due to a spree of acquisitions. By June 1983, Barratt was the largest housebuilder in the country, selling a record 16,500 houses over the prior 12 months.[4]Sales more than halved during the mid 1980s, a trend that was partly attributed to public criticism of Barratt's practices in two successive ITVWorld in Actionprogrammes. In response, Barratt was heavily restructured, abandoned timber-framed construction in favour of a new product range, and de-emphasised its starter homes activities.

While Barratt Developments has almost exclusively focused on the British market, the overseas subsidiaryBarratt Americanwas established in the 1980s; it was eventually sold on via amanagement buyoutin 2004. Barratt Developments was heavily impacted by theearly 1990s recession,compelling Lawrie Barratt to return to active management and house production to be increased. During 2007, Barratt made its first acquisition in almost 30 years, purchasingWilson Bowdenfor £2.7 billion, which enabled Barrett to become the biggest homebuilder in Britain once again. Amid the economic effects of theGreat Recession,the firm had towrite-offnearly £600 million along with 700 job losses and restructure its finances. During 2012,Barratt Residential Asset Managementwas established to provideproperty managementservices on a non-profit basis across Barratt London developments; it was acquired byFirstPortseven years later. On 7 February 2024, the company made an agreed offer to acquire rival homebuilderRedrowfor £2.5 billion; the deal was concluded in October 2024, when the firm became known asBarratt Redrow.

History

[edit]

In 1953,Lawrie Barratt,an accountant who was frustrated at the high purchase prices of houses for first-time buyers, bought five acres of land atDarras Hall,near Newcastle upon Tyne and built his own home on the site.[5]Following this experience, he joined forces with Lewis Greensitt, a Newcastle builder, to establish a house building business, which was initially known asGreensitt Brothers,in 1958.[6]

During 1968, the company wasfloatedon theLondon Stock ExchangeasGreensitt & Barratt,by which time the company was building 500 homes per year and the growth plan had been "fully achieved".[7]Lewis Greensitt left shortly after the flotation and in 1973 the company was renamed Barratt Developments.[8]Throughout the 1970s, Barratt completed a series of acquisitions, transforming the company from a local housebuilder to a national firm building around 10,000 houses per year, and rivallingGeorge Wimpeyin size. The largest of these acquisitions were the Manchester-based firmArthur Wardle[9]and the Luton-basedJanes.[10]

Central to Barratt's expansion was its high-profile marketing, with national advertising, featuringPatrick Allenand a helicopter.[11][12]Barratt provided starter homes for the first-time buyer and offeredpart-exchangeto those trading up. In the year to June 1983, Barratt sold a record 16,500 houses, making it by far the largest housebuilder in the country.[4]In 1983 and 1984, Barratt was subject to two successive ITVWorld in Actionprogrammes, the first criticising timber-framed housing and the latter, starter homes. Within two years, unit sales had more than halved. Lawrie Barratt led a total restructuring of the company, abandoning timber-framed construction, launching a new product range, and concentrating on the more profitable trade-up market.[8]In the late 1980s,Margaret Thatcherfamously purchased a house on one of Barratt's most upmarket estates, inDulwich,London.[13][14]

During the 1980s, the company established theCalifornian-based businessBarratt American,which expanded outside of the state after positive performance during the early 1990s.[15]In 2004, the company sold Barratt American via amanagement buyoutin exchange for £91 million; at the time, it was Barratt's only overseas unit and management opted to focus on the UK market instead.[16][17]

The company was heavily impacted by theearly 1990s recession.[18][19]Barratt's fiscal circumstances led to Lawrie Barratt being recalled from retirement.[20]The company promptly reoriented towards first time buyers and increased production.[21][22]Lawrie retired for good in 1997 and remained life president of the firm until his death in December 2012.[4][23]

There was a lengthy housing boom in the late 1990s and early 2000s, which saw a number of Barratt's largest rivals, such asPersimmon,George WimpeyandTaylor Woodrowall acquire rivals to increase in size.[24][25][26]Likewise, in 2007, Barratt broke its tradition of 30 years and acquiredWilson Bowden,best known for its David Wilson Homes brand, in exchange for £2.7 billion; the move made Barrett the biggest homebuilder in Britain, employing roughly 7,500 people at the time of the acquisition.[27][28]thus bringing the David Wilson, Ward Homes and Wilson Bowden Developments brands to the group; Barrett decided to retain the Wilson Bowden name for some activities.[29][30]

In August 2008, amid the economic effects of theGreat Recessionand reports that Barrett was in jeopardy of breaking its banking covenants, the firm successfully restructured its arrangements.[31][32]During early 2009, it reported awrite-offof nearly £600 million a long with 700 job losses.[33][34]In November 2019, Barrett announced that it had completed its refinancing and was actively seeking to open new sites once again.[35]

During the early 2010s, the firm entered into numerous partnerships with other companies.[36][37][38]During 2012, theBarratt Residential Asset Managementdivision was established to provideproperty managementservices on a non-profit basis across Barratt London developments.[39]In March 2019, it was announced that Barratt Residential Asset Management had been acquired byFirstPort;as a result of the deal, the 11,000 Barratt London homes that it managed were transferred over to FirstPort.[40][41]

In late 2017, Barratt withdrew from a development deal withEnfield Councilvalued at £6 billion after the local authority had dismissed its terms.[42]During June 2019, Barratt acquired Oregon Timber Frame, one of the UK’s largest timber frame manufacturers and a key supplier to Barratt.[43]

During 2020, Barratt Developments set science-based carbon reduction targets as well as making a commitment to build zero carbon homes from 2030 and become anet zerobusiness by 2040.[44]Examples of sustainable developments include the Green House[45]at the BRE Innovation Park, Hanham Hall near Bristol,[46]Derwenthorpe, near York[47]and Kingsbrook, near Aylesbury.[48]Another goal of the firm's emphasis on the adoption of modern methods of construction was to reduce the need for skilled labour.[49]

As of 2022, Barratt Developments had achieved a 5 star rating in theHome Builders Federationnew home Customer Satisfaction Survey for 14 consecutive years.[50]In the 2022 NHBC Pride in the Job awards for site managers, Barratt site managers won 98 Quality Awards, five Regional Awards and Midlands-based site manager Kirk Raine won the Supreme Award in the large builder category for the third time.[51]

Barratt Redrow

[edit]

On 7 February 2024, the company made an agreed offer to acquireRedrowfor £2.5 billion.[52]On the same date, both firms had confirmed reduced revenue and profit.[53]The merged businesses would create a house builder, Barratt Redrow, turning over £7.45 billion and delivering over 22,600 homes a year.[54]Subject to regulatory and shareholder approval, the deal was expected to be completed in the second quarter of 2024.[54]The deal would see around 800 jobs lost and nine offices close.[55]In March 2024, theCompetition and Markets Authority(CMA) opened an investigation into the proposed acquisition, assessing if it might "result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services."[56]In May 2024, the proposed merger was approved by shareholders, but the deal remained subject to CMA clearance.[57]In August 2024, the CMA said the proposed deal raised competition concerns only in one specific part of the country: northShropshire.Barratt and Redrow could make submissions to address the CMA's concerns about that area, to avoid the deal being subject to an in-depth phase two review.[58]On 22 August 2024, Barratt officially took ownership of Redrow shares, but both firms would continue to operate independently until granting of final CMA approval.[59]On 7 October 2024, after the CMA investigation was closed, the company becameBarratt Redrowplc.[60]Following the completion of the takeover, CEODavid Thomasrevealed plans to find £90m in cost savings through consolidation of the supply chain, closure of nine divisional offices, and consolidation of central and support functions.[61]

Also in February 2024, Barratt and Redrow were among eight UK house-builders targeted by the CMA in an investigation into suspected breaches of competition law. The CMA said it had evidence that firms shared commercially sensitive information with competitors, influencing the build-out of sites and the prices of new homes.[62]

In September 2024, prior to final CMA authorisation of Barratt's Redrow acquisition, Barratt was overtaken byVistryas Britain's biggest house-builder, after it forecast it would deliver more than 18,000 homes, surpassing Barratt's 14,000.[63]In October 2024, Barratt Redrow said it expected to complete between 16,600 and 17,200 homes in 2025;[61]CEO David Thomas later said Barratt Redrow expected to build 22,000 homes a year.[64]

Operations

[edit]

UK house building

[edit]

Barratt Developments PLC owns three consumer brands: Barratt Homes, David Wilson Homes and Barratt London.[65]

Commercial construction

[edit]

Barratt owns and operatesWilson Bowden Developments,which develops commercial property in the UK.[66]

Among projects led by Wilson Bowden Developments is Optimus Point, a 74-acre greenfield site at Glenfield, Leicestershire.[67]

Criticisms

[edit]
The Citiscape building in Croydon clad in scaffolding due to the removal of flammable cladding and defects found in the reinforced concrete frame

In 2017, theDaily Telegraphnoted "10 purported crashes in just 48 hours" on what they regard as arguably "Britain’s most dangerous roundabout." Derbyshire County Council removed wrecked vehicles from the roundabout atMickleoverwhich drivers said was poorly lit and badly signed. The council said that Barratts were responsible for the design though it had been checked by their engineers.[68]

In 2019, the CMA launched an investigation into alleged mis-selling of homes on aleaseholdbasis, with Barratt one of four housebuilders targeted in September 2020. In August 2022, after "careful scrutiny of the evidence gathered", and an assessment that a successful legal case was unlikely, the CMA closed its three-year investigation citing lack of evidence, while noting "Barratt’s sales practices have changed, and they no longer sell leasehold houses."[69]

In 2020, during remedial work to replaceflammable claddingat the Citiscape high-rise inCroydon,defects were found in the reinforced concrete frame of the building. A further review found similar defects in seven other developments. Remediation was set to cost £70m in 2020, but had increased a year later to £163m.[70][71]Citiscape residents were rehoused in September 2019, and in May 2021, Barratt reacquired the 95 flats at Citiscape from their leaseholders and was in the process of reacquiring the freehold from aVincent Tchenguizcontrolled company.[72]In addition to remediation work at Citiscape, Barratt later (July 2024) identified two further London developments requiring £130 million in further work to resolve concrete frame issues.[73]

On 27 July 2021, an article byThe TimesEnvironment Correspondent, Ben Webster, highlighted issues over the approach to biodiversity reporting taken by Barratt subsidiary, David Wilson Homes. in relation to a green field development in the Buckinghamshire village ofMaids Moreton.[74]

In September 2023, Barratt submitted plans to demolish 83 new homes on its Darwin Green estate in Cambridge which had been built with faulty foundations.[75]

In October 2023, The Comet newspaper carried a report of David Wilson Homes representative Martin Wright being "told off for making threats" at a planning meeting related to the Highover Farm development in Hitchin. Planning Committee member, Councillor Daniel Allen commented "Threatening us is not a great way to make friends during a statement" after Mr Wright advised a Planning Inspector could "strike out" some of the developer contributions.[76]

In July 2024,The Guardianreported a home inIvybridge,Devon,built by Barratt subsidiary David Wilson Homes and sold for £274,995, had been independently valued in 2023 at £1 due to a catalogue of major defects.[77]Owners of other houses on the same Ivybridge estate had also reported problems, and were engaged in legal action seeking redress from Barratt.[77]

References

[edit]
  1. ^"Barratt Developments p l c overview - Find and update company information - GOV.UK".Companies House.Retrieved15 February2024.
  2. ^"Housebuilder CEO gets £890,000 pay rise as Help to Buy boom continues".Yahoo. 17 September 2019.Retrieved2 August2021.
  3. ^abcd"Annual Report 2024"(PDF).Barratt Developments.Retrieved27 September2024.
  4. ^abc"Sir Lawrie Barratt".The Telegraph.20 December 2012.Retrieved19 March2016.
  5. ^"Regal Founder had a humble start".U-T San Diego. 19 June 2005. Archived fromthe originalon 27 May 2006.Retrieved1 March2021.
  6. ^"Sir Lawrie Barratt".Daily Telegraph.20 December 2012.Retrieved1 March2021.
  7. ^Company prospectus.November 1968.
  8. ^abWellings, Fred (2006).Dictionary of British Housebuilders.Troubador.ISBN978-0-9552965-0-5.
  9. ^Greensitt & Barratt offer document April 1972
  10. ^Barratt offer document January 1976
  11. ^"Classic Ads: Barratts with Patrick Allen".YouTube.14 May 2012.Archivedfrom the original on 21 December 2021.Retrieved18 April2019.
  12. ^Barker, Dennis (9 August 2006)."Obituary: Patrick Allen".The Guardian.
  13. ^Arnot, Chris (30 January 2002)."Laager toffs".The Guardian.London, UK.Archivedfrom the original on 30 October 2008.Retrieved8 October2008.
  14. ^"The industry comments on the Thatcher years".constructionmanagement.co.uk.12 April 2013.
  15. ^"06Apr90 USA: BARRATT DEVELOPMENTS PLANS TO EXPAND OUTSIDE CALIFORNIA AFTER RECORD YEAR".constructionnews.co.uk.5 April 1990.
  16. ^Haddad, Annette (31 August 2004)."Builder Bought Out by Insiders".Los Angeles Times.
  17. ^"Barratt sells US arm to fund expansion in UK".building.co.uk.5 August 2004.
  18. ^"28Sep90 UK: FIRST BARRATT CUT IN DIVIDEND AS PRETAX PROFIT FALLS FROM £77.5M TO £30.2M – CITY WARNS OF MORE".constructionnews.co.uk.27 September 1990.
  19. ^"30Aug91 UK: BARRATT DEVELOPMENTS SHUTS SALFORD AND LUTON REGIONAL OFFICES".constructionnews.co.uk.29 August 1991.
  20. ^Gardiner, Joey (21 November 2012)."'I'll be back' - Why Boss es return to run their companies ".Building.co.uk.
  21. ^"01Apr93 UK: BARRATT PLOTS A BOOST IN HOUSE SALES".constructionnews.co.uk.1 April 1993.
  22. ^"Barratt bounds into spring with sales rise and expansion plans".constructionnews.co.uk.9 March 1995.
  23. ^Gardiner, By Joey (19 December 2012)."Barratt founder dies aged 85".Building.co.uk.
  24. ^"Wimpey moves in on Laing Homes".The Guardian.17 October 2002.
  25. ^Stevenson, Rachel (2 September 2003)."Taylor Woodrow to buy Wilson Connolly".The Independent.
  26. ^"Business - UK housebuilders announce tie-up".BBC News.Retrieved21 March2015.
  27. ^Noel, Andrew; Kernon, Sophie (6 February 2007)."Barratt Developments to buy Wilson Bowden".Bloomberg. Archived fromthe originalon 8 February 2007 – via International Herald Tribune.
  28. ^Kollewe, Julia (6 February 2007)."Wilson Bowden takeover makes Barratt UK's largest housebuilder".The Guardian.
  29. ^Blackman, David (4 May 2007)."Barratt to close nine divisions and cut 400 jobs".building.co.uk.
  30. ^Gardiner, Joey (11 April 2008)."Barratt puts Wilson Bowden Developments up for sale".building.co.uk.
  31. ^KLETTNER, ANDREA (18 September 2008)."Barratt's financial results under scrutiny".constructionnews.co.uk.
  32. ^"Need to Know".The Times.London, UK. 7 August 2008. Archived fromthe originalon 12 June 2011.Retrieved8 October2008.
  33. ^WHITTEN, NICK (25 February 2009)."Barratt cuts a further 700 jobs".constructionnews.co.uk.
  34. ^WHITTEN, NICK (5 March 2009)."Barratt shares up after £600m loss on landbank writedowns".constructionnews.co.uk.
  35. ^WHITTEN, NICK (17 November 2009)."Barratt to open new sites after successful refinancing".constructionnews.co.uk.
  36. ^FITZPATRICK, TOM (20 July 2011)."Barratt and Peel ink £200m deal for 1,000 homes".constructionnews.co.uk.
  37. ^WILSON, ROBYN (19 October 2015)."Barratt partners with Galliard for West Ham Utd redevelopment".constructionnews.co.uk.
  38. ^BERKIN, CHRIS (24 July 2013)."Barratt and British Land win £250m Aldgate approval".constructionnews.co.uk.
  39. ^"Welcome to BRAM".barratthomes.co.uk.Retrieved27 August2015.
  40. ^Rosser, Emma (19 March 2019)."FirstPort acquires Barratt Residential Asset Management".Estates Gazette.
  41. ^"FirstPort acquires Barratt London's property management arm".propertyweek.20 March 2019.
  42. ^GARNER-PURKIS, ZAK (26 October 2017)."Barratt's £6bn Enfield residential deal collapses".constructionnews.co.uk.
  43. ^Blundell, Steph (28 June 2019)."Barratt Development acquires timber frame manufacturers".Planning, BIM & Construction Today.Retrieved1 March2021.
  44. ^"UK's largest housebuilder sets 1.5C-aligned emissions targets".edie.net.Retrieved1 March2021.
  45. ^"Barratt Green House – BRE Innovation Parks".Retrieved1 March2021.
  46. ^"Barratt contracted to build UK's first eco-village".The Guardian.14 December 2007.Retrieved1 March2021.
  47. ^"Derwenthorpe, York".JRHT.14 May 2015.Retrieved1 March2021.
  48. ^"Kingsbrook: New Standards in Wildlife-Friendly Housing".The RSPB.Retrieved1 March2021.
  49. ^PRICE, DAVID (2 September 2021)."Barratt turns to MMC amid rising labour costs".constructionnews.co.uk.
  50. ^"Barratt Developments awarded 5 stars by its customers for a record 14 years in a row".Barratt Developments.
  51. ^"Pride in the Job 2022 | NHBC".nhbc.co.uk.
  52. ^"UK's biggest housebuilder Barratt to buy rival Redrow for £2.5bn".The Guardian.7 February 2024.Retrieved7 February2024.
  53. ^Gayne, Daniel (7 February 2024)."Barratt and Redrow profits down on day merger between pair announced".Building.Retrieved8 February2024.
  54. ^abMorby, Aaron (7 February 2024)."Barratt strikes deal to buy Redrow for £2.5bn".Construction Enquirer.Retrieved8 February2024.
  55. ^Prior, Grant (8 February 2024)."Barratt Redrow deal could see 800 jobs lost".Construction Enquirer.Retrieved8 February2024.
  56. ^Prior, Grant (15 March 2024)."Competition watchdog probes Barratt Redrow merger".Construction Enquirer.Retrieved15 March2024.
  57. ^Morby, Aaron (16 May 2024)."Shareholders approve £2.5bn Barratt and Redrow merger".Construction Enquirer.Retrieved16 May2024.
  58. ^"Barratt-Redrow merger competition concerns limited to Shropshire".The Construction Index.8 August 2024.Retrieved8 August2024.
  59. ^Gayne, Daniel (22 August 2024)."Barratt officially takes ownership of Redrow shares".Housing Today.Retrieved24 August2024.
  60. ^"Barratt's Redrow acquisition clears final hurdle".The Construction Index.7 October 2024.Retrieved7 October2024.
  61. ^abMorby, Aaron (23 October 2024)."Barratt Redrow starts hunt for supply chain savings".Construction Enquirer.Retrieved23 October2024.
  62. ^Morby, Aaron (26 February 2024)."Competition probe launched into 8 major house builders".Construction Enquirer.Retrieved26 February2024.
  63. ^Morby, Aaron (5 September 2024)."Vistry unseats Barratt as Britain's biggest house builder".Construction Enquirer.Retrieved5 September2024.
  64. ^Thomas, David (2 November 2024)."Why we as Barratt Redrow expect to build 22,000 homes a year".Building.Retrieved2 November2024.
  65. ^"Our Brands".barratthomes.co.uk.Retrieved27 November2017.
  66. ^"Wilson Bowden Developments in a Potential Sale".business-sale.Retrieved15 March2015.
  67. ^"Optimus Point".optimuspoint.Retrieved1 March2021.
  68. ^Ward, Victoria; Horton, Helena (31 July 2017)."Worst roundabout in Britain? Multiple crashes at 'lethal' roundabout cause concern".The Daily Telegraph.Retrieved4 August2017.
  69. ^Gardiner, Joey (16 August 2021)."Regulator drops 'leasehold' investigation into Barratt without taking action".Building.Retrieved16 August2022.
  70. ^Morby, Aaron (6 July 2020)."Barratt uncovers weak concrete frames at seven high rises".Construction Enquirer.Retrieved6 July2020.
  71. ^Grant Prior (6 May 2021)."Barratt problem concrete frames and cladding bill hits £163m".Construction Enquirer.Retrieved18 June2021.
  72. ^Clarence-Smith, Louisa; Lees, Martina (22 May 2021)."Barratt breaks new ground buying back flats after cladding scandal".The Times.Retrieved18 June2021.
  73. ^Prior, Grant (10 July 2024)."Concrete frame problems cost Barratt another £130m".Construction Enquirer.Retrieved10 July2024.
  74. ^"Wildlife rules 'too easy to manipulate' by builders".The Times.27 July 2022.Retrieved13 June2022.
  75. ^Prior, Grant (27 September 2023)."Barratt to demolish more homes with faulty foundations".Construction Enquirer.Retrieved27 September2023.
  76. ^"Highover Farm developer told off for 'making threats'".The Comet.16 October 2023.
  77. ^abTaylor, Diane (13 July 2024)."'I feel sick': couple say new-build home turned into disaster valued at £1 ".Guardian.Retrieved18 July2024.
[edit]
Wikimedia Commons has media related toBarratt Developments.
Retrieved from "https://en.wikipedia.org/w/index.php?title=Barratt_Redrow&oldid=1255021823"