High-rise specialist Renaker posted record revenue and profit despite “periods of uncertainty and delays” brought on by gateway two building safety requirements.
The developer-builder, responsible for many of Manchester’s city-centre high-rises, reported its pre-tax profit had grown by 27 per cent to £6.3m in the year ending 31 October 2024.
It posted a £5m profit the previous year.
Turnover also increased by 16 per cent from £229.1m to £265.4m – its highest-ever level – largely driven by the completion of three major projects.
This was Renaker’s fourth consecutive year of higher turnover since 2020/21, when it posted revenue of £130.3m.
Director Daren Whitaker wrote that the firm’s record turnover was partly down to the scale of individual projects it is delivering.
However, he added that new building safety regulations were impacting the design of residential properties and supply chain engagement.
“Since the introduction of the new Building Safety Regulator in October 2023 there have been very few gateway two assessments completed,” Whitaker wrote.
“Developers and contractors might share the commercial risk associated with the time taken for the gateway review, but the consequences of delay resulting from a failed assessment could be significant for all parts of the supply chain.”
The firm, which is preparing to submit its first gateway two application, is managing the risk by “maintaining direct control over design solutions and the supply chain”, Whitaker said in the strategic report within the accounts.
He added: “While the implementation of these measures has introduced periods of uncertainty and delays in some projects, we remain optimistic that these disruptions will be minimised moving forward, and the current challenges are temporary.”
Whitaker also warned that construction costs for residential high-rise buildings remained at an “all-time high” compared with pre-pandemic levels, although he said material and energy costs had calmed.
He expressed hope that the new government would bring stability and the recent base rate cut would stimulate housing demand.
However, he noted that it would take time for new government objectives to be delivered and for planning reforms to translate into increased construction.
During the financial year, Renaker completed its 445-home Three60 residential tower and handed over the first 870-bed phase of its Union co-living scheme for client Vita Property.
It also completed a primary school job last August.
In 2025, the firm expects to complete 1,414 apartments, 576 student beds and 806 co-living units across five developments.
Renaker – which finished 72nd in Construction News’ annual CN100 ranking last year – specialises in developing and constructing high-rise residential schemes both for itself and other clients.
Cash at hand in its latest accounts rose from £15m to £15.8m, but no dividends were paid out.
Manchester-based Renaker, which was founded in 2006, held no short- or long-term repayable bank loans.
Its average monthly staff headcount increased from 365 to 377 employees, leading to a higher annual wage bill of £21.4m compared with £20.1m the previous year.