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12 January 2016 – Expansión
The British real estate company Taylor Wimpey sold 53% more properties in Spain in 2015, thanks to the recovery of the market and the appreciation of the Pound against the Euro, which attracted more British buyers.
Taylor Wimpey, which owns residential developments on the Spanish Mediterranean coast and in the Balearic Islands, sold 251 homes in Spain last year, compared with 164 in 2014. In addition, the average price paid for each property increased from €250,000 to €314,000. As a result, its turnover amounted to around €79 million, up by 92%.
Thanks to increases in the number of operations as well as in their value, the company says that the operating profit of its Spanish subsidiaries in 2015 exceeded the profit of GBP 4.2 million (€5.6 million) recorded a year earlier. The definitive financial data for last year will be announced next month.
Besides the sales that have already been completed, the property developer claims to have signed pre-contracts for the sale of a further 270 homes in Spain.
“We saw a significant improvement in the Spanish market in 2015” explained Taylor Wimpey yesterday in a statement to the London Stock Exchange. However, despite this recovery, the Group’s annual sales have not yet returned to the levels recorded in the Spanish market before the crisis. In 2006, for example, TW sold 379 properties and recorded turnover of around €130 million.
The majority of the homes that Taylor Wimpey promotes in Spain are acquired by British citizens who want to have a second residence in this country. According to data from the Association of Registrars (el Colegio de Registradores), citizens from the UK accounted for a fifth of the acquisitions made by foreigners in the Spanish market in 2015.
Spain is the only country outside of the UK where Taylor Wimpey has a presence. After recognising provisions for around €60 million between 2007 and 2010 to reflect the decrease in the value of its developments and land in Spain, the company started buying land again on the Costa del Sol and in Mallorca, where it forecast future demand from overseas investors. During the crisis, Taylor closed its operations in Gibraltar.
In the British market, Taylor Wimpey sold 13,341 homes in 2015, which represented an increase of 7%. According to Anthony Codling, analyst at Jefferies, “Taylor has had a clear strategy since the outbreak of the financial crisis – it focuses on margin rather than volume and invests in strategic locations (only)”.
The company’s share price rose by 0.62% yesterday, taking its cumulative increase over the last year to 61%. Its market capitalisation amounts to GBP 6,300 million in total.
Original story: Expansión (by R. Casado)
Translation: Carmel Drake