7th Apr 2022 11:47
(Alliance News) - FTSE-250 housebuilders Bellway PLC and Vistry PLC are the latest to have signed the UK government's Building Safety Pledge, the companies announced on Thursday.
The Building Safety pledge was established following the Grenfell Tower fire in 2017 to ensure the safety of highrise buildings, by removing combustible materials such as cladding. Housebuilders who sign are committed to following new guidelines for work on potentially dangerous cladding on high-rise buildings between 36 feet and 59ft.
Newcastle Upon Tyne-based Bellway estimated the cost of remediation to be a further GBP300 million, in addition to the GBP186.8 million set aside since 2017, of which GBP128.3 million was left as of January 31.
The additional cost will be recorded as an adjusting item for its year ending July 31.
"We have always taken the issue of building safety very seriously and agree with the government's principle that residents should not have to fund life-critical fire safety remedial works," said Bellway Chief Executive Jason Honeyman.
Kings Hill, England-based Vistry said its estimate for the cost of fire safety work was unchanged from its projection last month. It still predicts a range between GBP35 million and GBP50 million, and now budgets a further amount of around GBP1.5 million to GBP3.0 million a year in administrative costs.
This is in addition to the fire safety provision of GBP25.2 million as of December 31, Vistry noted.
Shares in Vistry were up 0.7% to 930.00 pence each in London on Thursday morning, as Bellway shares fell 1.0% to 2,529.00p each.
The firms join Barratt Developments PLC, Redrow PLC, MJ Gleeson PLC, Persimmon PLC and Crest Nicholson Holdings PLC who also signed the pledge this week, with total cladding remediation bills for UK-listed housebuilders now exceeding GBP1.2 billion.
By Elizabeth Winter; [email protected]
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