Redrow PLC Building Safety Pledge (3863H)
April 06 2022 - 1:00AM
UK Regulatory
TIDMRDW
RNS Number : 3863H
Redrow PLC
06 April 2022
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JURISDICTION.
FOR IMMEDIATE RELEASE
6 April 2022
REDROW plc
Commitment to the Government's Building Safety Pledge
As reported in our Interim Results we believe the housebuilding
industry should play its part in resolving the issue of legacy fire
safety in high rise buildings and that the financial burden should
not be borne by leaseholders.
In January of this year the Rt Hon Michael Gove (Secretary of
State for Levelling Up, Housing & Communities and Minister for
Intergovernmental Relations) announced his intention to approach
developers to fund the remediation of life critical fire safety
issues on buildings over 11m with which they had any involvement in
the development, going back 30 years. Since then the Home Builders
Federation and the Company, along with many others in the industry,
have been engaged with Government with regard to this matter. The
individual companies within the industry, including ourselves, have
now received from Government a proposed voluntary pledge by
developers regarding the remediation of life critical fire safety
issues on these buildings. Redrow has signed up to this pledge and
a copy will be made available on our website, www.redrowplc.co.uk,
in due course.
Historically Redrow has not been a major constructor of high
rise apartments. The majority of our high rise apartment schemes
were built between 2000 and 2010 as a response to the Governments
Planning Policy Guidance 3 which encouraged high density living.
Due to our limited expertise in the design and building of such
schemes, we outsourced the design and construction of the vast
majority of these developments to principal contractors. To date
Redrow has provided for estimated remediation costs of the small
number of such buildings we constructed ourselves.
In signing up to the pledge we will be remediating all the
buildings in which we were involved, whether or not we constructed
them, going back 30 years. This is a highly complex matter and the
exact remediation work required and for the exact number of
buildings will take time to determine. Our existing provision for
fire safety in high rise buildings is GBP36m. Based on the latest
information we have and the work done by our internal teams we
believe an additional provision of GBP164m is required as a result
of the pledge. This will be treated as an exceptional item in the
results for the 2022 Financial Year. We will work with leaseholders
to remediate their buildings and, where possible, pursue recoveries
from main contractors, warranty providers and other third parties.
As these recoveries are not certain, they have not been recognised
in estimating the provision. These remediation works are expected
to take a number of years to complete.
This pledge is in addition to the Residential Property Developer
Tax of 4% of pre-tax profit which came in to effect on 1 April
2022.
The person responsible for making this notification is Graham
Cope, Group Company Secretary.
For further information contact:
Redrow plc
Matthew Pratt, Group Chief Executive 01244 527411
Barbara Richmond, Group Finance
Director 01244 527411
Instinctif Partners 0207 457 2020
Tim McCall, Head of Capital Markets 07753 561862
Bryn Woodward, Associate Partner 07500 027181
LEI Number:
2138008WJZBBA7EYEL28
Announcement Classification:
2.2 Inside information
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