Populo Living has moved away from design and build towards a development manager model
Newham Council’s wholly-owned developer recorded a large profit increase but started no new homes last year after switching its business model.
According to its account for the year to 31 March 2024, Populo Living responded to poor economic conditions by moving “increasingly towards delivering projects as development managers” for Newham Council, rather than working as a design and build company developing homes for itself.
The result of Populo’s strategic shift was that it did not start any new homes during the financial year, although it completed 320 over the period.
It said that last year’s completion of 98 homes at Brickyard, 40 at Town Hall Annex and 182 at Plaistow Hub would be the last to be developed as design and build.
The completions mean the total number of homes under management now stands at 795, a little more than half of the 1,500 it said it would need to cover its operational costs.
Populo expects to start construction on more than 600 new homes over the next year.
The business recorded revenue of £8.83m in the period, down slightly from £9.94m, while pre-tax profit stood at £22.2m, compared with a loss of £9.7m the previous year.
Fair value movements contributed £23.8m to the positive side of the profit and loss sheet.
Newham Council is the sole shareholder of Populo, although it operates largely independently.
The council itself has faced massive financial pressures of late, with the east London local authority warning last summer that it could be in need of a government bailout due to spiralling temporary accommodation costs.
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