Springfield secures £18.2m development agreement
Springfield secures £18.2m development agreement for Dalmarnock in partnership with West of Scotland Housing Association
Springfield Properties plc (AIM: SPR), a leading housebuilder in Scotland offering private and affordable housing, is pleased to announce that it has signed an agreement totalling £18.2m with West of Scotland Housing Association (WSHA) for the development of 114 affordable homes and two commercial units in Dalmarnock, Glasgow. This development is part of the Clyde Gateway project – Scotland’s largest regeneration programme – and will be jointly funded by Glasgow City Council and private finance provided by WSHA Lenders.
With planning consent already in place, the Group expects to commence construction in March 2020 and to complete handovers by the end of its 2021/22 financial year. The agreement improves Springfield’s revenue and profit visibility by securing the revenue for this development as well as supporting cashflow with revenue recognised based on monthly valuation over the period of delivery.
Under this agreement, the Group will deliver 114 homes for WSHA, comprising one- to five-bedroom social rented and mid-market rent homes. The plans also include two commercial units and provision of play areas. The homes are designed to be attractive to live in and highly energy efficient, which will reduce running costs for tenants, and solar photovoltaic panels will be installed on the roof of the buildings.
The 2.2-hectare development has planning consent for 237 homes, and the Group is in negotiation for the provision of the second phase of 123 homes with another provider. It is located in the east end of Glasgow on a brownfield site that has been empty for approximately 60 years. The Clyde Gateway regeneration programme, which is a partnership between Glasgow City Council, South Lanarkshire Council and Scottish Enterprise, is backed by the Scottish Government and aims to achieve social, economic and physical change for communities over an area of 840 hectares. Over a 20-year period to 2028, the programme intends to deliver the construction of 10,000 new homes and creation of 21,000 jobs.
Innes Smith, CEO of Springfield Properties, said: “This is another great contract for Springfield that strengthens our revenue visibility over the next two years. We are also proud to be contributing to the Clyde Gateway regeneration, which is an important programme to stimulate growth in this area in the West of Scotland as well as provide much needed additional housing in Glasgow.
“At Springfield, we believe everyone deserves a good place to live. We know we can build more homes, for more people, by working with strong partners who have the same vision. We are pleased to be partnering with West of Scotland Housing Association for the first time and look forward to delivering well-designed, attractive, highly energy efficient homes that will have a positive impact on the area.”
Andrew Kubski, Director of Development and Asset Management of West of Scotland Housing Association, commented: “West of Scotland Housing Association is excited to be working with Springfield Properties on our first joint Glasgow project. We have been supported both by our own funders and funding provided by Glasgow City Council that allows us to deliver these 114 homes that will form an integral part of WSHA’s development programme and growth strategy to create high quality energy efficient homes for our tenants and customers.’’
Councillor Kenny McLean, City Convener for Neighbourhoods, Housing and Public Realm at Glasgow City Council, said: “It is pleasing to see the signing of this agreement, paving the way for the building of 114 affordable homes in Dalmarnock and continuing the area’s regeneration. The council is delighted to support this project, which will see new quality homes built to the highest environmental standards. These flats are of various sizes to suit different household needs. This is another example of the many developments that are now bringing affordable and energy-efficient new homes to Glasgow.”