Seddon has revealed it abandoned a potential off-site housing tie-up with investor Legal & General after changing tack on the activity.
In a wide-ranging interview with Construction News, chief executive Jonathan Seddon said the firm had spent “a lot of time” looking at off-site manufactured homes with Legal & General, but eventually stepped away from the project.
Legal & General has invested £55m in an off-site factory in Yorkshire, having signed a long-term lease last February with local company Logicor on the 550,000 sq ft warehouse, based in Sherburn-in-Elmet near Leeds.
The factory aimed to supply two initial pilot schemes: one for a third-party developer and one internal L&G scheme.
The two projects were understood to each be 20-50 units in size.
The investor wants the factory to be in full production during 2017 and has set a target of building 3,000 homes a year. These will be a mixture of third-party and internal L&G projects.
Mr Seddon said his firm was ”close to getting 40 houses away with [L&G] in Cheshire” before it stepped away.
Read the full interview
Jonathan Seddon on how to keep a family business profitable in a cutthroat industry – and why he doesn’t like frogs
He added that his firm had changed its approach to off-site manufacturing significantly, with the company now focusing on modularisation of certain components rather than a large-scale investment in its own technology.
“I’ve gone from thinking we need to be involved and owning and operating some sort of off-site Laing O’Rourke-style facility, to actually thinking we need to have full knowledge of all the systems out there,” he said.
Despite describing the L&G model as “fantastic”, Mr Seddon added that off-site housing “doesn’t stack up in terms of cost”.
“In lower prices, the critical path for a traditional housing estate isn’t getting the houses built. It starts with the place-making skills and planning permission.”
L&G has been contacted for comment.