MMC Podcast series ep2: Yorkshire-based manufacturer ilke Homes calls for government to reserve land "exclusively" for factory-built homes
Offsite manufacturers are ready to deliver the homes the country needs as soon as they get the green light, but the land must be made available to them.
Public land should be reserved exclusively for factory-built homes in a bid to create jobs across the North and to stoke new investment into tech and innovation, the boss of leading modular housing manufacturer ilke Homes has said.
Dave Sheridan, executive chairman at ilke Homes, called on ministers to be "proactive in bringing forward land and designating land exclusively for factory-built homes" to help accelerate the pace of housing procurement and delivery in the UK, which will be pivotal to any post-Covid-19 recovery plans. Sheridan said that Homes England should be applauded for the way it has supported partners across the centre and called on ministers to accelerate the use of MMC to build better quality homes more quickly.
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PropCast: The Property Podcast · MMC Series: Dave Sheridan, executive chairman of ilke Homes
Sheridan said that housing associations have a key role to play in using their own funds and their own land and should be encouraged to collaborate closely with Homes England and other stakeholders.
Housing secretary Robert Jenrick and housing minister Christopher Pincher have a once-in-a-generation opportunity to spearhead not just a housing revolution, but a skills revolution that could see Britain create a host of globally exportable businesses using technology and world-class engineering to manufacture homes.
Homes England recently revealed in its end of year report that it had acquired 19 sites across the country with capacity to build 5,000 new homes. The former Keepmoat Group CEO wants to see some of this land earmarked for modular housing developments.
The government has previously introduced policies to support the uptake of the modern methods of construction (MMC). The Accelerated Construction programme provides investment to help organisations and businesses build homes on former public sector land, with the government stating they were "focusing on MMC" to help build an additional 32,000 homes.
The appetite for modular housing developments is there, Sheridan believes, saying that Homes England has stated its intention for offsite manufacturers such as ilke Homes to be at the forefront of post-recovery housing delivery.
Homes England has been an advocate for MMC, having invested £30m into ilke Homes in November 2019 and working with Urban Splash and Japanese housebuilder Sekisui House in a joint venture in May 2019.
"Because we can build a home at twice the speed of traditional construction, the cashflow can be generated in half the time and the delivery of the homes the country needs can be faster," he said.
He also suggested policy-makers need to "work with banks and mortgage lenders to ensure they are supportive of buyers during this period," following concerns from developers over the availability of mortgages.
The uncertainty in the market is hitting consumer confidence, so developers must work with potential home buyers to signal their confidence that the economy is going to recover, Sheridan said; "we've all got a part to play."
Collaboration between offsite manufacturers will also be crucial to getting Britain building again in the recovery, with Sheridan saying that the sector must work together in sharing ideas and technology to immediately kickstart housing delivery.
He pointed to car manufacturing and aerospace manufacturing as examples of industries sharing technology, arguing that it is "more cost effective" to be collaborative on technological advancements.
But Sheridan believes that for offsite manufacturing to ramp up delivery, the supply chain must be more accommodating to this modern method of construction, and diversify the types of products on offer.
At present, modular housing accounts for roughly five percent of total new builds in the UK, according to a report by law firm Pinsent Masons.
But following a string of major investments in the UK modular market last year that saw Britain's largest housing association Places for People sign a £100m deal with ilke Homes for 750 homes, Homes England invest £30m in the offsite manufacturer, and Goldman Sachs bet £75m on TopHat, offsite manufacturers are well-capitalised and have the expertise to be leading the house building efforts.
With the factories, sites and a workforce in place, offsite manufacturers are well positioned to restart delivery.
Dave Sheridan is executive chairman at ilke Homes
You can listen to this podcast via Apple Podcasts or Spotify or SoundCloud or through the player above. This podcast was produced by Blackstock Consulting founder Andrew Teacher and you can Tweet your views @andrewjteacher
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LISTEN TO PREVIOUS EPISODES:
Episode 1: Modular construction has an important role to play in UK's housebuilding rebound
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