Providing 50,000 homes annually will be next government’s ‘biggest challenge’, says Glenveagh CEO

Providing 50,000 homes a year will be the biggest challenge facing the next government, Stephen Garvey chief executive of leading housebuilder, Glenveagh Properties, warned on Wednesday.

Mr Garvey, whose company boosted 2023 profits by 4 per cent to €112.7 million, said he agreed with calculations that the Republic needs 50,000 new homes a year to house its growing population.

“The biggest challenge facing whoever makes up the next Government is how do you go to 50,000 from 30,000 or 32,000?” he said, answering questions on the impact on housing of an administration possibly including Sinn Féin.

Mr Garvey stressed that he had no views on who should be in power following the next election, but cautioned that they would all face the same problems: providing enough homes while ensuring they are affordable.

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Leading opposition party Sinn Féin’s alternative 2024 budget for housing argued for the construction of 21,000 social and affordable homes this year, 7,300 more than the Government’s target.

Glenveagh built around 700 social, cost rental and affordable homes last year and earned €17 million revenue from working on housing developments with public bodies.

The company is also working with the State’s Land Development Agency on possible projects to provide more housing.

In a statement published with its results on Wednesday, Mr Garvey noted that Glenveagh’s partnerships with public organisations were “delivering thousands of new homes in conjunction with local authorities and approved housing bodies”.

Speaking to reporters later, Mr Garvey noted that the current Government had done a lot for home ownership through affordability schemes and tackling the planning backlog.

He cautioned that the Government should continue to put resources into the Republic’s planning system to ensure that backlogs do not recur.

Mr Garvey argued that allowing the system to work first would be a better approach to tackling its problems than embarking immediately on the overhaul proposed in the Government’s Planning and Development Bill.

He said the Government should “resource the system fully” to clear the backlogs. “Then let it work and figure out what the problems are,” he added.

Government hopes the Oireachtas will pass the planning Bill into law this year and has made it a key part of its strategy for tackling a system hampered by backlogs and legal challenges.

Glenveagh’s revenues dipped 4 per cent last year to almost €608 million. However, turnover actually rose modestly when the company excluded the €63 million sale of a site on Dublin’s East Road in 2022.

The company is building homes on sites in Dublin and its surrounding counties, as well as in Kilkenny, Offaly and Cork. It sold 1,328 new suburban houses last year, according to its accounts.

Earnings per share of 8 cent were at the top of the company’s guided range, a 5.3 per cent advance in the year. It returned around €63 million, to shareholders in 2023, for a total of €300 million over three years.

Glenveagh’s investment in its off-site manufacturing business Nua aided it in controlling supplies and costs, said Mr Garvey.

Looking ahead, the group said it had “increased confidence” with current consensus earnings per share expectations for the 2024 financial year of approximately 17 cent.

Glenveagh said the long-term demand outlook in the Irish market was very positive, supported by a resilient domestic economy and a fast-growing population, with State initiatives also supporting the market.

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