UAE-owned London developer posts £22m pre-tax loss
A London firm recently bought up by a United Arab Emirates-based developer has posted a £22m pre-tax loss.
In its latest accounts for the year ending 31 March 2023, London Square slumped to a pre-tax loss of £22m, down from a profit of more than £11m in the previous year.
The developer also reported revenue of £252m, down from £278m in 2022. Its margin was down to 4.8% from 8.3% in the previous year due to cost inflation, rising interest rates and regulatory changes.
A £10bn developer listed on the stock exchange in the UAE bought out London Square in December.
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Aldar Properties snapped up London Square in a multimillion-pound acquisition that marked the firm’s first deal outside of the Middle East and North Africa (MENA) region.
It is the largest real estate group in Abu Dhabi and one of the largest in MENA.
Aldar, which is listed on the Abu Dhabi Securities Exchange, said the deal is aligned with its strategic vision of “expanding into key and mature international markets”.
It is expected the acquisition will drive a new phase of growth for both firms.
London Square maintains that the business is well positioned to grow despite the reported loss in the last year.
On development, its tenure mix was driven by private sale, followed by affordable and build-to-rent.
The firm completed 390 homes, of which 164 were affordable. Its accounts showed it expects the proportion of affordable units it delivers to increase going forward.
Its forward sales position tops £311m and London Square has a landbank of more than 3,000 units.
In his forward, Andrew Lawrence, chief executive at London Square, said: “The economic background remains uncertain, but the expectation that higher inflation and consequently higher interest rates are likely to remain for the foreseeable future.
“However, for the housing market, the demand supply imbalance also appears to be here to stay and accordingly, the current trading activity of the group has been steady, and the group remains on track for delivery of its planned residential unit sales.”
London Square announced in September the acquisition of a 550-home site in south-east London for a £180m housing scheme.
The firm launched its own affordable housing arm, Square Roots, in January 2021.
Source: Inside Housing
