Insurance firm Aviva also among the existing and new shareholders to back the MMC start-up 

tophat factory

What TopHat’s factory in Corby will look like

Listed housebuilder Persimmon and insurance company Aviva have led a £70m investment into modular housebuilder TopHat. 

The investment is designed to help the start-up build on its current output of up to 800 homes a year through building what it says will be Europe’s largest modular housing factory in Corby, Northampton. 

It aims to manufacture up to 4,000 ultra low-carbon homes annually with the new 650,000 square feet facility, which it expects to open next year. 

TopHat, which is majority owned by investment bank Goldman Sachs, said the investment is the first time a FTSE 100-listed housebuilder had invested directly into a modular manufacturer. 

Existing Goldman Sachs Asset Management shareholders also contributed to the £70m investment in TopHat, which recorded a £5m loss in 2021 and a further £19.4m loss last year. Last year it said it would be profit-making within three years. 

Aviva gave the financial backing through its Aviva Capital Partners unit, a newly launched in-house capital unit. TopHat did not say how much each of the funding partners provided to the fundraising.

Jordan Rosenhaus, chief executive and founder at TopHat, said: “Today’s announcement is testament to the innovative approach that TopHat continues to take to house building and marks a step-change for the future of housing.”

Dean Finch, group chief executive at Persimmon, said: “This investment provides Persimmon with guaranteed access to very energy-efficient volumetric modular units as well as TopHat’s innovative brick façade to use with our Space4 timber frame products. 

“This will provide further build efficiencies, manage the growing challenge of labour shortages in key trades and expand our product range for customers.”

John Cummins, chief executive of Aviva Capital Partners, said: “Aviva is using its financial strength to invest in the sustainable infrastructure and real estate which are central to the UK’s net zero transition.” 

Homes England is funding TopHat’s development at Kitchener Barracks in Chatham and is looking at more ways it can support modular housebuilding. 

Harry Swales, chief investment officer at Homes England, said this investment was an “important step” for TopHat but also “really encouraging for the wider sector.”  

“Modern Methods of Construction have the potential to revolutionise the housing sector, driving greater efficiency and productivity, reducing carbon emissions, decreasing disruption caused by construction and increasing consumer choice,” Swales said.  

“As the government’s housing and regeneration agency, we’re committed to increasing the use of MMC, and supporting our partners in the sector to invest in it.”

The quango vowed to continue with “ambitious and innovative partners” after modular housing business House by Urban Splash went into administration last year

A spokesperson for TopHat said the company would still be able to sell to other housebuilders as there was a clear ‘virtual barrier’ set up to stop information being shared about companies that would lead to any ethical or legal violations. 

“Clear Chinese walls have been established to protect the interests of non-shareholder customers,” the spokesperson said. 

TopHat said every home it manufactures is capable of being zero-carbon, which is achieved through the building fabric used and low-carbon technologies, such as solar panels and battery storage. 

The firm was founded in 2016 by Rosenhaus and architect and chief design officer Krishan Pattni and is believed to be one of the UK’s leading 3D modular housebuilders.