Government pumps £30m into house building factory

Homes England has agreed a £30m investment into North Yorkshire-based modular homes builder ilke Homes.

It is part of the UK Government’s drive to help build more homes faster, while creating additional capacity in the construction industry.

The ilke Homes process creates 90% less waste than traditional construction, with its Flaxby Yorkshire factory  recruiting and re-skilling workers from outside the industry.

The £30m deal from Homes England’s Home Building Fund is the first time the agency has ever directly invested to boost an offsite manufacturer’s production capacity.

Over the coming year, ilke Homes will be investing considerably in digitisation and in expanding its facilities, allowing it to manufacture homes across a range of price-points. The funding will allowing it to scale-up production and accelerate manufacturing capacity from two to eight homes per day, bringing manufacturing costs down in the process.

By next year, 2,000 modular homes will roll off ilke Homes’ production line at its 250,000 sq ft factory. This will rise to 5,000 homes a year within the next five years, making ilke Homes a Top 10 housebuilder in the UK.

The precision-engineered homes, manufactured with galvanised steel frames, are designed to beat traditional homes on energy efficiency and durability.

By manufacturing offsite, the homes are delivered twice as fast as traditional methods of construction meaning income streams can be accessed faster by private developers, housing associations and local authorities.

ilke Homes works with private developers and major housing associations, like Places for People and Home Group, as both a joint venture partner and as a supplier of turnkey products that developers can use themselves.

Housing Minister Esther McVey MP said: “The North of England has the potential to lead the world in the modern methods of construction that are transforming home building. An industry that when matured would be worth £40 billion a year and provide up to 80,000 jobs. We need to fully embrace this.

“This £30 million investment in ilke Homes is a significant step forwards in the development of the ‘Construction Corridor’ – a new hub in the North that is front and centre of building the homes we need.

“It’s vital we invest in new technology to get Britain building. Homes built using modern methods can be of higher quality, greener and built to last.”

Dave Sheridan, executive chairman at ilke Homes, said: “This deal is testament to the dynamic approach Homes England is taking to address structural issues within our housing and construction industries.

“The funding will bring in further private capital, creating hundreds more skilled jobs allowing us to build more homes, more quickly for first-time buyers.

“We want to continue driving efficiency, quality and sustainability within the housebuilding industry and see this as a fantastic signal to others wishing to do the same.”

Nick Walkley, chief executive at Homes England, said: “Our role is to be bold and take steps to speed up the delivery of homes across the country and there is huge, untapped potential to unleash by creating more capacity in offsite manufacturing.

“Modern methods of construction offer enormous benefits to housebuilding and this deal will have a transformational effect on ilke Homes’ production.”

Mark Farmer, a Government advisor who warned in his landmark report that the construction sector must “modernise or die”, said: “Today’s announcement highlights Homes England’s increasing appetite to make direct interventions into the housing market to address some of the challenges we face building high quality homes at pace.

“The ilke Homes product has proven itself to be among the very best and this unequivocal support from Government should further incentivise investment into modern methods of construction.”

Back in May, ilke Homes agreed the UK’s largest ever modular housing deal with Places for People for 750 homes.

Recently, the company launched its on-site academy dedicated to training a new generation of engineers to manufacture modular homes. The academy will enable trainees from all walks of life to learn vital skills in electrical engineering, manufacturing and carpentry.