Drop in development ambition no longer temporary, social landlord confirms
L&Q has dropped its long-held target of building 100,000 homes altogether in the latest downgrade of its development ambition.
The housing association giant had previously announced plans to slow down its development plans over five years to 3,000 homes a year, as it focused on investing in existing stock and meeting building safety costs.
However, it said in March that its longer term ambition beyond the five years remained the same, implying a return to its planned rate of development, of around 10,000 homes a year. New chief executive Fiona Fletcher Smith in January said the group’s ambition to build 100,000 homes remained but with a “short term” slower pace of development.
The 100,000-home target has now been removed. A spokesperson for L&Q confirmed this week that no further targets have been set beyond building out its 32,000-home development pipeline. The group’s financial statement for 2020/21 said it aspires to build these homes at a rate of around 3,000 homes per year over the next 10 years.
Despite the reduced ambition, this rate of development would still be higher than the number of homes completed by L&Q, or any other housing association, over the last three years.
The spokesperson said: “Our ambition to build homes at scale to tackle the housing crisis has never gone away. But it’s right that we prioritise the safety of our existing homes, and delivering consistent, reliable services for our residents and customers across the country.
“We’ll continue to work with partners to explore opportunities for medium to long term growth, whilst placing more focus on delivering better, environmentally sustainable homes, but won’t be setting targets beyond our 32,000-home development pipeline at this moment in time.”
L&Q’s accounts for 2020/21 published this week showed a 43% drop in spending on new homes as it conserved cash in the pandemic.
The group completed 2,699 homes, which was 11% higher than the previous year but below the 4,209 target it set for the year pre-pandemic.
An L&Q trading update published to the stock market this morning shows the group completed 1,003 homes in the first quarter of 2020/21.
The group also announced an overhaul of its development and sales division this week as it seeks to build out its 32,000-home pipeline.
Timeline: L&Q’s shifting development ambition
December 2016: L&Q, following its merger with East Thames, declares an ambition to build 100,000 new homes
September 2019: L&Q announces a temporary pause to new development projects, citing building safety costs and uncertainty over Brexit
February 2020: Despite the pause, group development director Fiona-Fletcher-Smith recommits L&Q to building 100,000 homes in 10 years, saying the group can be ‘bigger than Barratt”
January 2021: Fletcher-Smith, now chief executive of L&Q, said the group’s ambition of building 100,000 homes over a decade remains, but the pace of delivery will slow in the short-term
March 2021: L&Q slashes its five-year build targets from 10,000 to 3,000 homes a year. A spokesperson says however its longer-term development ambition its unchanged.
August 2021: L&Q confirms there is now no targets set beyond building out its 32,000-home pipeline over 10 years.