Sisk chief executive Steve Bowcott: Housing crisis to last longer than expected

By Geoff Percival

Ireland is unlikely to reach a housing supply balance, of 30,000-40,000 new builds per year, by 2021, according to one of the country’s largest construction firms.

Earlier this month, estate agent Savills said supply should balance out by 2021, with economic think-tank the ESRI suggesting the same timeframe.

However, speaking on the back of a decent set of annual results, Sisk chief executive Steve Bowcott said he doesn’t see supply meeting demand by the early 2020s unless there is a quick and widespread freeing up of public land by the Government.

Sisk returned to the housebuilding space in 2016 after nearly a decade of focusing entirely on commercial and industrial projects, which still make up its core business. On the residential side, it acts in the affordable housing space and claims it can build houses and sell to local authorities at around €160,000-€170,000 per unit; roughly half the price quoted by mainstream housing developers.

It has recently picked up three Dublin-based housing development projects which will see 750 homes built across them.

It is also bidding for a 500-home project, which would be developed on a public-private partnership basis.

Mr Bowcott said Sisk is providing options for the housing market, including a building mechanism which can cool house price growth, but said more public land needs to be made available.

Last week, the ESRI said it expected house prices to continue growing over the next three years. On the back of recently revised house completion data from the CSO, the think-tank predicted around 18,700 new houses would be built this year and 23,200 next year. That compares to previous estimates of 25,000 and 31,000, respectively, for the two years.

Sisk also has operations in the UK, Scandinavia, and mainland Europe. It reported pre-tax profits of €24.7m for 2017, up by 73% on the previous year and boosted by an €11.4m exceptional gain through the award of owed monies from its former Polish road-building projects.

Turnover, however, fell by 5% to €792.2m after a number of projects were postponed.

Mr Bowcott said regional projects, rather than Dublin-based work, will generate more revenue for Sisk’s core Irish business this year. Last year saw Sisk hand over the €70m redevelopment of Páirc Uí Chaoimh to the GAA and complete the N17 Gort-to-Tuam motorway.

Its redevelopment of the Curragh racecourse has recently started and Sisk will be in charge of the major expansion planned for Cork’s Bons Secours hospital. The company will also play a major role in the €23m construction of international holiday park company Center Parcs first Irish resort, in Longford, which is due to open next year

at a cost of €23m

.

In Dublin, on the commercial front, Sisk is currently bidding for a couple of office block developments, and a number of data centres including one planned by the Texas-headquartered cloud services company CyrusOne.

“We continue to be selective about the projects we undertake. Sisk has the financial platform and skilled people to compete for business across key sectors based on high quality, timely, cost-efficient, and safe project delivery,” said Mr Bowcott.

“There is a strong order book for 2018 and... the business looks to the future with confidence.”


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