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C&M to beef up its house building work

FINANCE - Firm puts in motion plan to sell off its £14 million commercial property portfolio

COUNTRY & Metropolitan is off-loading its £14 million portfolio of commercial property over the next two years to invest in more land and concentrate on house building.

The firm, which lifted pre-tax profits to £10.4 million in the year to June 2004, is already in tentative negotiations with a privately-owned house builder in northern England.

Finance director Nish Malde said: 'If a slowdown happens there will be several distressed house builders, particularly in the south-east, and we want to be able to take advantage of that.'

C&M moved into low-cost housing in northern England but is returning with similar initiatives in the south, where it has 300 homes under construction, compared with just 64 a year ago. The group's northern low-cost housing operation NCH is expanding into Lancashire. It recently set up a new subsidiary, Chorley Homes, to achieve this and is looking elsewhere.

Land director David Foster said: 'South Wales has the right demographics for us in terms of low-cost homes.We should look at Bristol and Bath, but both depend on the opportunities.'

The company has a consented land bank of 2,800 units and sold 759 homes in the last financial year at an average price of £121,000.These sales generated turnover of £81.4 million - up from £60.5 million in the preceding 10 months.

Chief executive Stephen Wicks expects the firm to sell around 900 homes this year and 1,000 units homes by the end of the next financial year but does not want sales to get any larger than 2,000 a year. He added: 'If we don't keep growing eventually someone will look at us for an acquisition but not just yet, I hope.'