Solid performance at property group despite subdued residential market
Rotherham-headquartered property group, Harworth, says it managed a resilient performance against a tough economic backdrop in its half year results for the six months ended 30 June 2023.
It reports group revenues of £18.2m (H1 2022: £62.6m) and pre-tax profits of £4.5m (H1 2022: £98.8m). The group had available liquidity of £163.5m as of 30 June 2023 (31 December 2022: £175.6m), with no major refinancing requirements until 2027.
During the period, the group completed 110,000 sq ft of Grade A space at Gateway 36 in Barnsley, which is now 35% let, with good interest for remaining units.
And it is currently on-site with 166,000 sq ft of space at the Advanced Manufacturing Park in Rotherham, which is so far 44% pre-let.
Acquisitions added 1.1m sq ft of industrial & logistics space and 700 residential plots to Harworth’s pipeline. And it secured planning consent for 397 residential units and 0.3m sq ft of industrial & logistics space.
Lynda Shillaw, chief executive, said: “Harworth’s first half performance reflected good progress against strategic objectives, coupled with a strong operational delivery, which highlights the resilience of our through-the-cycle model, and sustained demand for our serviced residential land and industrial & logistics assets.
“In particular, the combination of sales of more mature industrial & logistics sites and our development of new high-specification space has accelerated the transition of our Investment Portfolio towards our goal of 100% Grade A.
“The industrial & logistics market has stabilised over the period, albeit transactions are taking longer to complete, and the residential Build-to-Rent market is experiencing sustained demand.
“However, interest rate rises, cost inflation and planning delays are all impacting the housebuilders. House prices have remained reasonably resilient supported by reduced volumes of new build.”
Harworth notes consumer demand remains subdued in the residential sector, due to higher mortgage rates, challenging affordability and lower consumer confidence.
It warns housebuilders are indicating reduced construction volumes over the coming year and a more selective approach to land acquisitions.
But despite this, the group says it has still seen seen good levels of demand from a range of housebuilders.
