L&G delivers ‘landmark’ 5,000 homes as profit increases

Legal and General delivered more than 5,000 homes last year, a figure it describes as a “landmark.”

The insurance giant, in its full year results, said it grew its housing portfolio, which includes housebuilder Cala Homes, for-profit provider Legal & General Affordable Homes, L&G Modular Homes and later living business Inspired Villages, from £1.98bn to £2.3bn in value.

Cala Homes grew its pre-tax profit by 27% to £169m and its turnover by 10% to £1.24bn. L&G also said Cala has “made a good start” to 2023, completing 200 sales with reservations at 41% of its target for the year. It said however this figure was slightly below the figure for the same period last year.

L&G Affordable Homes increased its operating profit from £26m to £37m and now has more than 3,032 homes operational having added 1,365 homes last year. The for-profit provider buys homes, including through section 106 planning deals, and then outsources the management of the homes to other housing association partners.

Its development and operation pipeline now stands at more than 6,500 homes, with a gross asset value of £1.2bn.

It said its later living business Inspired Villages is “on track” to deliver 5,000 homes through its 15-year joint venture with the pension fund of bank Natwest. L&G also said its modular business “continues to work towards profitability”. It made a pre-tax loss of £37m in 2021.

Overall L&G increased its pre-tax profit by 7% to £2.66bn. Its operating profit was £2.52bn, above market expectations.

It said: ”Legal and General Capital continues to scale up in housing and had a landmark year, delivering over 5,000 new homes across our portfolio with a focus on creating sustainable homes.

>> See also: Why Nigel Wilson is persisting with L&G’s huge housing push

>> See also L&G Affordable Homes’ ambitious plans for expansion

“As energy prices increase, our research shows an acceleration in consumer demand for energy efficient homes. Diversified across affordability and life stage, LGC’s Housing investments meet the UK’s long-term social and economic need for quality housing for all demographics while producing long-term dependable shareholder returns.”

2023 is likely to the final full year with Sir Nigel Wilson at the helm. Wilson announced his retirement in January but is staying in post until a replacement is found.